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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Earlie who wrote (45435)	2/2/1999 4:12:00 PM
From: Peter Singleton	Read Replies (1) \| Respond to of 132070

hey, Earlie, Our friend, the tireless Jim Hopkins from the Kahuna thread, has an interesting speculation. Since October, he's seen a correlation between the Fed injecting overnight reserves and the market's performance the next day (e.g., they didn't today). Henry Volquardsen on the Derivatives thread (another smart guy) has pointed out that juggling with overnight reserves is typically done for temporary, technical adjustments, with the Fed purchasing Treasuries when they want to expand the money supply. Whatever the reason, the Fed has been injecting reserves consistently over the past several months. Some other folks on links too numerous to mention (Mike-and-Will type links) have speculated the Fed is willing to reinflate the bubble, knowing the risks, since they feel the risk to the banking system is too great right now, and they want to give the big banks et al time to unwind some of their leverage. Interesting to speculate, isn't it? Peter