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Strategies & Market Trends : Currencies and the Global Capital Markets -- Ignore unavailable to you. Want to Upgrade?

To: Frodo Baxter who wrote (502)	8/28/1998 11:01:00 PM
From: Robert Douglas	Read Replies (2) \| Respond to of 3536

Lawrence, Inflation is dead. Greenspan for President. Let's cut Fed funds. Now. I'm getting close to agreeing with your post. Inflation is dead. Well dead is not the word I would use. I would say that the US economic body has been vaccinated against inflation. Every once in a while we will be exposed to it and our antibodies (the markets) will automatically destroy it. This will cause a few fevers but they will be short lived. I am still worried about wages, but I think that the odds now favor that the economy will slow sufficiently over the next year to contain inflation. Mostly from an increasingly negative net exports number. I'm beginning to worry that the US is going to have to continue as demand engine to the world for a while longer. This means that we will be running ever larger trade deficits to pull the rest of the world out of recession. This requires strong final sales demand in the United States. Additionally the dollar needs to decline to take pressure off countries that have suffered by linking their currencies to ours. The best way to accomplish both of these goals is to cut short term rates. 50 basis points now and 50 later, sounds good to me. What's Alan's email address? -Robert