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To: zonder who wrote (275548)1/29/2004 10:36:23 AM
From: Jim Fleming  Read Replies (1) | Respond to of 436258
 
Z

Higher interest rates are very inflationary to the point where they cannot be passed on and then become deflationary.

Jim



To: zonder who wrote (275548)1/29/2004 10:36:31 AM
From: Bid Buster  Read Replies (3) | Respond to of 436258
 
In theory higher costs of borrowing reduces demand for borrowing, but it didn't stop the borrowing frenzy in '99-'00 with rates at 9.5% did it?



To: zonder who wrote (275548)1/29/2004 10:54:04 AM
From: Tom Smith  Read Replies (1) | Respond to of 436258
 
the fed will wait until they're clearly behind the curve with regard to 'undesirable' inflation (as opposed to it's current policy for the 'desirable' variety) before they raise rates....change in language suggests that they KNOW 'undesirable' inflation is in the pipeline and can't be avoided for long. Perhaps also the dollar requires propping prior to shrub's incursion into Paki-land.