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Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: Ilaine who wrote (218377)	2/14/2007 8:47:53 AM
From: jttmab	Read Replies (1) \| Respond to of 281500

The Fed has the greatest impact both in terms of interest rates and money supply. The Senate of course approves the appointments. Once again it's a cooperative effort. I don't know how one measures what effect the Treasury has on interest rates when it prints money vs. what impact the Fed has by changing what % of reserves are held by financial institutions. The public generally doesn't even know when those events occur. But the Fed once appointed operates independently of the Executive. Bush Sr. wanted Greenspan to lower interest rates but wishing and hoping didn't do Bush Sr. any good. Increasing the money supply is more psychology than anything. Oooh, more money let's spend it. How much did re-fis and equity lines of credit affect the economy vs. a drop in tax rates vs. an increase in the money supply? I don't think it's quantifiable. Economist just have a sense of which one is of larger impact. If you're a politician, you point to the one you like the best and which metrics show good things. I believe that the president does appoint the members of the PPT -- Plunge Protection Team. I'd guess they are appointees as well. Does it affect the economy in the long run. Where would the market be today if the markets weren't shut down for a few days after 9/11. Who knows? jttmab