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Non-Tech : Simula (SMU) -- Ignore unavailable to you. Want to Upgrade?

To: Jaime H. Ayalde who wrote (1313)	8/24/1998 2:08:00 AM
From: Noblesse Oblige	Read Replies (1) \| Respond to of 1671

Offthread to Jaime... With the interest rate on ten year paper now below that of overnight money, one would think that the Fed would be considering this reduction sometime soon. An inverted yield curve is pretty strong evidence of an impending recession. Ordinarily, it gets inverted by the Fed increasing short term rates until they exceed the rates on longer term paper. This is truly a unique situation, as it appears that the market is inverting the curve without any help at all from the Fed. I hope someone down there is watching closely. Deflation is more than just a risk now...it appears to be happening already, and depending on what happens to currency values in the far east (and let us see what China actually decides to do if it goes further into recession because of the competitive devaluations in that area), things might actually get pretty wild. Wild....as in uncontrollable. Time will tell, Jaime.