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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: John Pitera who wrote (8217)	9/5/2007 2:37:44 PM
From: Louis V. Lambrecht	Respond to of 33421

Helicopter Ben never made a secret on how he could (and would) get out of a financial crisis. He can talk the market on rate cuts, he even could cut rates and remain the sole rate cutter on Earth. The other CBs (or what takes the place of CBs) are contemplatingrate rises. What we now have are rate cuts in FedFunds and Notes, while LIBOR rises (in my terms, confscation as most collaterals in the futures are 13-wk notes). Primary Dealers receiving drom the Fed a present yo carry trade, not only the LIBOR, but even Eurodollars are inreresting. Primary Dealers lent money at FED rates, pay the collaterals at FED rates (and other US debt as yje 10-yr) , but lend money to other banks (and mortgage institutions) at LIBOR rates. The FED system is rotten and only profits the Primary Dealers, not the people. Typical IMF methods, socialize the debt (pay less interest for gov. devt, ask higher interest for loans), but bail out the government (US system with primary dealers is a ponzi, but still is the US gov way to manage money).