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Politics : Idea Of The Day -- Ignore unavailable to you. Want to Upgrade?

To: James Strauss who wrote (19097)	7/29/1998 10:01:00 PM
From: Lee	Read Replies (1) \| Respond to of 50167

James,..Re:<<So we have a situation where Alan Greenspan fakes concern about possible inflation to cool down the markets and to misdirect our attention from the real need for a FED interest rate cut.. >> Please view the longer term chart of CPI to see that a possible bottom occurred several months ago. dismal.com Apart from the fact we may have seen the bottom in the CPI, the following additional reasons would preclude any rate easing now. - M2 growing at an annual 7.2% rate - Consumer borrowing rising at an 8.2% rate and business borrowing at a 7.8% rate - Median house prices rising at a 6% annual rate - Dow is rising at a 14%+ rate - Unemployment rate at 4.5% - Average hourly earnings rising at a 3.9% rate - Consumption rising at a 6% rate (accounts for 68%of GDP) and retail sales rising at 7.8% rate - CPI has bottomed - see graph above - benefit costs accelerating - Greenspan was one of the Fed members who would wait before raising rates, two would have raised rates already. Even reviewing recent economic data, consumer confidence is still at a very high reading, durable goods ex transportation were up 1.9% in today's report. Now given these facts, why would the central bank ease rates? Also, I don't understand why Mr. Greenspan needs to fake anything. The facts/data are available for all to view. Lee