Posted on 08/13/2002 9:20:48 AM PDT by john bell hood
The idea that action by the Fed is necessary to bail out the economy at this juncture is dangerous. The real federal funds rate is very near zero and the economy grew very well throughout the 1990s with real interest rates much higher than they are today. The real problem for stock markets in recent months has been policy. Trade protectionism, huge growth in government spending, the slow phase-in (and the 10-year phase-out) of the tax cut, and the potential for congressional legislation to over-regulate business, are all culprits. Using the Fed to offset these negatives is a recipe for stagflation. What the economy needs most is a commitment to free markets by the Bush White House.
As for the article itself, the author is more concerned about the stock market than the actual state of our economy. Two different animals.
-------------------------------------
Amen. Two entirely different things. Whether a limited groups of people is making money on their stock portfolio is not the condition of the economy any more than whether people in Holland were making money speculation on tulip bulbs in 1535.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.