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

To: Oeconomicus who wrote (25126)	8/25/1998 6:14:00 AM
From: robert b furman	Respond to of 94695

The refinancing of government debt took a 180 turn with Mr.clintons's presidency.Short term rates were utilized (by preference) over long term rates because they were simply lower. prior to that relatively lower rates were viewed as a good situation to take advantage of for the longer term.I remember thinking this change in preference was riskier but so far to Clintons' credit - it has worked.So has the first retroactive tax increase I ever experienced(It also was the largest). For that piece of economic engineering Mr. clinton never did and never will receive my one vote. Agreed on credit cards and rates on marginal borrowings.I think we agree.It could be said that where Joe Six Pack is concerned -prime applies except where the beauty of a competitive marketplace breaks thru the bankers false benchmark of prime ie libor rates,commercial paper and mortgages. Larger packages of debt develope more efficiient funding sources.I still think that the market place has led the fed thru every rate reduction of late - the fact that the yield curve is currently inverted simply shows how dogmatic and slow they really are. The global world is in a deflationary spiral (with the exception of some emerging worlds that have devalued their currency by printing money at mach 10 speeds - they have what they've got coming to them IMHO)and our fed is stuck with an old mantra when it becomes more and more apparent that our global economy IS DIFFERENT than the 60's or 70's. 1) it is global and forced to be efficient 2) the many benefits of the digital information age greatly enhance competitive efficiencies and should be encouraged rather than viewed with a jaundice eye JMHO and BWDIK Bob