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Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: Proud_Infidel who wrote (2763)	8/30/2002 10:33:10 AM
From: Steve Lee	Respond to of 25522

I based it on the cause and effect chain in my post. Interest rate cuts don't make that much difference when people and corporations have lost their life savings on the stock market. In fact, in my opinion, interest rate cuts are making the situation worse. If I am right in my assumption that profits and revs have fallen due to an oversupply situation, then low rates lengthen the correction of the oversupply condition. I am not saying that rates should be made punitive as there is a benefit in a soft landing, but I think that the feds have erred on the soft side, which will make for a harder landing in the end. I believe the federal govt has lowered rates because it is in a lot of debt. By lowering rates, the govt lowers the coupon obligation it incurs when it issues the new debt that it has to issue in order to pay off the existing debt.