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To: art slott who wrote (2883)	9/19/1998 6:14:00 PM
From: ahhaha	Read Replies (1) \| Respond to of 4748

What I'm talking about is that the FED has purchased a greater quantity of RPs and direct permanent securities than it has in all history. In spite of all that they still can't get the fed funds rate down. The economy is too strong so there is strong demand for interbank funds. The FED through fear chooses to keep the world pumped up with cash. The problem is that foreign governments will soon be pumping too and our already exploding money supply will then be used to speculate in low price stocks. It is the end of the cycle and the big companies prospects are flat at best, so the hot money goes into the under $5 stocks. When there is plenty of money but no efficiency in investment, the money goes to bid up prices. Then the wage demanders are forced to extract inflationary wage settlements in order to protect themselves and you've got structural inflation which has been masked so far by the strong dollar. Foreign pumping will reverse the dollar and what has been masked will become painfully evident. The last period occurs when the free market raises rates over the protests of pumping central banks. The result: world recession. The only question is: how long before the punchbowl is stolen from the party?