Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: MulhollandDrive who wrote (8780)	1/23/2008 11:22:19 AM
From: Augustus Gloop	Read Replies (1) \| Respond to of 33421

Regulation will come from this. It's like the 1934 securities act. After a group of men raped and profited from the system they grouped together to write regulation to keep people from doing what they did LOL.

To: MulhollandDrive who wrote (8780)	1/23/2008 2:43:42 PM
From: John Pitera	Respond to of 33421

Fortunately Dr. Greenspan is almost 80, let's just hope he slows down and fades off into the sunset... now Bill Clinton, on the other hand is still looking to stir every pot he can find. I agree with you that more should be made of Greenspan's consulting to big beneficiaries of AG's perpetual put option on real risk premium pricing. and..... GOOD GRIEF..... wouldn't you know it; a very astute Stephen Roach is over in Davos pointing out that *Al and Ben's Risk-free Adventures,* are possibly creating more bubbles to replace these many current bubbles we have come to know and love so dearly!!! John -------------------------------------------------- Fed Risks Fueling More Bubbles, Davos Economists Say (Update1) By John Fraher and Simon Kennedy Jan. 23 (Bloomberg) -- The Federal Reserve, which yesterday announced its first emergency rate cut since 2001, is ignoring history's lessons and risks re-igniting more asset bubbles, economists at the World Economic Forum annual meeting said. The Fed is saying ``we are there to clean up after bubbles first rather than to prevent the danger,'' Stephen Roach, Morgan Stanley's Asia chairman, said in a panel discussion in Davos, Switzerland. ``It's a dangerous, reckless and irresponsible way to run the world's largest economy.'' The Fed cut its benchmark rate by 75 basis points yesterday after stock markets tumbled from Hong Kong to London amid signs of a U.S. recession. The central bank has drawn fire for paying too much attention to economic growth and not enough to asset prices, fueling unsustainable booms in stocks, property and derivatives. Former Fed Chairman Alan Greenspan was criticized for failing to curb the Internet stock boom of the 1990s and for then fueling further bubbles by cutting rates too much to limit the fallout when equities crashed. ``It's good for a central bank to ease when the risks are of a crash in the global economy, but that means you have to have a more systematic approach to asset bubbles,'' said Nouriel Roubini, founder of New York-based Roubini Global Economics LLC. ``If we have a `Greenspan put' or a `Bernanke put,' then we will create over and over again a distortion of excessive debt and leverage.'' Counter Argument The Fed's cut came a day after the MSCI World Index fell 3 percent, the steepest decline since 2002. Greenspan and Bernanke counter that it's too difficult for central banks to spot bubbles before they emerge and raising rates to curb higher housing or stock prices would risk derailing the rest of the economy. Explaining its decision, the Fed yesterday said ``broader financial market conditions have continued to deteriorate and credit has tightened further for some businesses and households.''