You may not ask me but I think there is something wrong with monetary management when an increase in jobs and minor upticks in wages sends the markets DOWN not UP. And this, just one day after CNBC floor interviews indicated the selling was over.What can be expected if jobs and wages went south instead? Utter chaos?I know, I know, we have to be extremely timid when it comes to that nasty inflation threat but, if Greenspan continues to wish for it -- it will happen.I'm concerned that something worse is creeping up on us as we continue to focus on rate hikes that were implemented in '98.H.
I think Mr. Greenspan does a good job for all of us when he rattles his saber. The financial community always gripes about it (it hurts them at bonus time), but what he accomplishes is he shakes the weak money out of the system. That gives a stronger house of cards, less likely to collapse.One of the reasons the expansion has gone on for so long is that the Fed has learned to use its power more subtly than it did even 20 years ago. And the economy and the politicians have given them room to maneuver. But who knows how long it will last.
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