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Strategies & Market Trends : Heinz Blasnik- Views You Can Use -- Ignore unavailable to you. Want to Upgrade?

To: Jim Willie CB who wrote (388)	4/22/2003 11:36:34 AM
From: philv	Read Replies (1) \| Respond to of 4914

As a Canadian, I can definitely state that Americans do not hold a monopoly on stupidity. Phil

To: Jim Willie CB who wrote (388)	4/22/2003 12:31:41 PM
From: GraceZ	Read Replies (1) \| Respond to of 4914

What you are seeing when you look at the increases in the monetary base has a lot to do with the public's desire to hold cash and currency. The Fed can only add to reserves from which loans are made. C&I has been dropping steadily since 2001. They can only make reserves available, in an environment of declining demand for loans the Fed can't add a dime. Here's a chart that puts it in perspective. It is a chart of the adjusted monetary base minus currency held by the non-bank public: mywebpages.comcast.net Notice that you have that huge air drop that the Fed made in anticipation of the crisis that didn't happen on Y2K and you also see the huge influx after 911, both which were backed out a little while later. Reserves minus currency are now lower then they were in 1994. The increases in the monetary aggregates represents the public's desire to hold money, nothing more and nothing less.