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To: Chip McVickar who wrote (23235)	5/14/1999 1:40:00 PM
From: TimbaBear	Respond to of 44573

Well, since you asked, I think the market believes that the drop in commodity prices brought about by the coming to the forefront of the global financial problems, has bottomed. I think a lot of uncertainty now exists as to what happens next. I don't think the market clearly understood the Fed's apparent and sudden departure from conservative inflation positions in the Fall. Therefore they are uncertain of the Fed's response to OPEC and other inflationary pressures. That uncertainty is being priced in as a premium to bond yields now. Market forces have been greatly tempered during this bull run by the steadying hand of the Fed and I believe the Fed will again show why the market has such confidence. Since I am not experienced in what constitutes effective monetary policy in this situation, I don't know what to expect, except that, in hindsight, the market will believe it to be the obvious thing to do! I believe the Fed will do something, just don't know what. I don't think they will end the meeting saying no change and make the markets wait until the minutes of the meeting are released to show a change in bias. I don't think the uppermost concern will be the welfare of the world's economies. I think the main concern has been and will remain the best interests of the US economy. If the US interests are addressed, the rest will be carried along.