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To: Broken_Clock who wrote (22089)	5/15/1998 11:41:00 AM
From: mph	Read Replies (2) \| Respond to of 95453

<<each person in the USA currently owes over 20k.>> Rather than continuing to pay more than 35% in taxes each year, I'd sure sign up for a one shot chance to pay it off! Merely an observation on an improbable scenario.<g> Even if that occurred, taxes would probably remain high simply because it is the taxing authority that gives Congressmen and women power and helps to keep them in office. The tax structure is a vehicle of social architecture in many respects. mph

To: Broken_Clock who wrote (22089)	5/15/1998 11:55:00 AM
From: SJS	Read Replies (4) \| Respond to of 95453

PK, Any comments on MDCO's fall. Unusually hard, compared with others in the group. Any news?

To: Broken_Clock who wrote (22089)	5/15/1998 1:20:00 PM
From: mc	Read Replies (2) \| Respond to of 95453

PK, You seem to be bouncing around about the dollar - earlier you complained about importing too much. Now you complain about what will happen if other countries start to sell their dollars. Well, the dollar would fall making imports more expensive and domestic goods more attractive. It is interesting to note though that with the Euro coming along the dollar could be partially replaced as the reserve currency of choice meaning the dollar could fall. However, to suggest that the dollar would be replaced in total by "people that don't even like us" is a bit of a stretch. The U.S. markets are the only place where you can go a few billion without liquidity or depreciation worries. The U.S. markets are larger than the second and third place countries' markets combined. That alone will insure continued dependence on the dollar by a good portion of the central banks around the world. Your argument about money supply keeping interest rates down is incorrect - the relationship is the opposite. Low interest rates keep the money supply high. The Fed does not control the money supply directly nor can they do it very accurately. The Fed controls the amount of reserves required at lending institutions and the discount rate (the rate at which the Fed makes loans to banks) which in turn effects other interest rates. These interest rates, if higher, reduce borrowing and thus decrease the money supply. Also, your concern about refinancing the huge national debt(thanks to Laffer, Reagan, and the supply side economics debacle) at a shorter term is noted, however, I think it is incorrect. The government is refinancing longer term debt with shorter term debt and saving money on the interest they are paying now. The assumption is that the savings will be greater than the cost of multiple refinancings later. The risk is that rates could rise. The argument against that is as follows: There is a certain amount of money available at current interest rates to borrow. One of the users of that credit is the government. If the government can continue to decrease the deficits (borrow less) then there is reduced demand for credit (the government doesn't need as much). Reduced demand means entities that loan money must lower their rates if they want to loan out their money. The lower rates save the government money on debt refinancing and at the same time encourages businesses to borrow for projects that may have not been cost effective at higher interest rates but are considered profitable at the lower rate. This increased business activity further improves the governments positions due to higher tax revenues. The trick is to keep the idiots in Washington from spending the savings. What they should do is pay down the debt. Although some people would argue that eventually, if we eliminate annual deficits, that growth will someday make the debt insignificant in terms of the size of the economy...but that's a discussion for another time. Good luck, Gary

To: Broken_Clock who wrote (22089)	5/15/1998 1:58:00 PM
From: waverider	Respond to of 95453

>>You don't base your information solely on the nightly news do you?<< PK, put the gloves back on. Geezzz. We don't watch TV in our family. No cable. No wires hangin' out the side of the house. Rent a few videos though. So with all that free time that I'm not wasting watching network sitcoms I have human interactions with friends and family. One buddy is into that economics stuff...which is interesting to me but is not an area within the arena of my otherwise stellar intellectual talents. We talk. I trust the guy. My general impressions about our country's economic health come from him. Don't got no numbers to back what I say about he economy 'cause I don't remember them. I do get the same information as you do, however, and yes I know the national debt is not pretty. My point was that with the increase in tax revenues BECAUSE of the incredible economic health and growth in this country the concept of a balanced budget is within sight. That is healthy. What the government does with it is anyone's guess. But I think we'll do O.K. I disagree with you about what the market is telling us. A 10 year trend is not something to be cast aside. We have had a raging bull market because the numbers (profits) support the gains. That is a fact. Are you saying (concerning overseas money) that all those dollars have the potential of coming back and that all the governments that hate us are going to cash in their bonds? Not a chance. They know what would happen to the world economy. Our survival is to their benefit. PK, it appears to me that you are a determined doomsayer in regards to the future of our country based on the fall of Rome and other previous historic episodes. Agreed, it will happen. No doubt. But I just don't see the point in going on and on about it now when our nation is stronger than it has ever been. To all that you speak, we have been through it before. We survived. The odds are in our favor that we will survive the doom you are predicting as well. Do you have any other candidates? <H>