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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: GROUND ZERO™ who wrote (77614)	11/20/2007 5:26:48 AM
From: Real Man	Read Replies (1) \| Respond to of 94695

Not engage in long-term bail out policies, which created huge moral hazard. Namely, 1) they should not have bailed out lots of crises in the 90-s 2) they should not have lowered rates to 1% and created the housing bubble in 2002 to bail out collapsing stock market bubble. 3) The Bush administration should not have lowered taxes, while increasing spending at the same time. The endgame of all this appears to be a sharply lower value of USD eventually, even though it may take the dollar a few more years to get there. The US standard of living has declined immensely already due to what happened to the dollar between 2002 and 2007. It appears stocks will be "saved" from NOMINAL decline (in dollars).

To: GROUND ZERO™ who wrote (77614)	11/20/2007 5:27:00 AM
From: saveslivesbyday	Read Replies (1) \| Respond to of 94695

"What could the Fed have done from the onset that could have prevented all this?" I'll take a stab at that one GZ; Some suggest they could acknowledge true rate of inflation and raise rates, which would force the markets to crash but ultimately purge the system of the severe excesses in liquidity, risk and speculation that exist. It could have been done 7 years ago, but Greenspan couldn't deal with a recession so he overreacted by flooding the money supply. The USA is like a chronically ill patient who prefers to take antibiotics and pain medicine rather than have a big operation that will temporarily hurt, but ultimately fix the problem. - Saves