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From: sas@leadsv.UUCP (Scott Stewart)
Newsgroups: net.invest,net.misc
Subject: Re: Re: Re: "World Banking Crisis" -- what is it?
Message-ID: <491@leadsv.UUCP>
Date: Thu, 27-Jun-85 15:29:44 EDT
Article-I.D.: leadsv.491
Posted: Thu Jun 27 15:29:44 1985
Date-Received: Mon, 1-Jul-85 07:11:54 EDT
References: <11154@brl-tgr.ARPA> <2287@sun.uucp> <161@idsvax.UUCP> <173@idsvax.UUCP>
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Organization: LMSC-LEADS, Sunnyvale, Ca.
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Xref: watmath net.invest:698 net.misc:8180

In article <173@idsvax.UUCP>, steiny@idsvax.UUCP (Don Steiny) writes:
> >
> > > 	Note that the policies of the current administration
> > > are modern day brinksmanship.  By keeping the interest rates
> > > high in the US, inflation has been subdued.
> > 
> > Not correct.  
> > 
> > Banks are being cautious about lowering their
> > rates too low.  When the prime is lowered too low (and if at
> > some later time it shoots up) the banks could get stuck
> > with too many low interest non-profitable loans.  Thus,
> > the prime will come down slowly, as it has.
> >
> 	The banks have to borrow their money from the Federal
> Reserve.  The interest rates are under the control of the Federal
> Reserve, specifically Paul Volker, they have been for many years.

Isn't the Federal Reserve seperate from any branch of the Federal
Government. I thought Congress and the President may apoint members,
but after that, they had little control of the policies. The 
administration (as mentioned above) I take to mean the Executive Branch
or Reagan. I thought I remember him criticizing Volker and the Federal
reserve for keeping interest rates higher than neccesary and thus keeping
interst rates and unemployment up as well.

					Scott A. Stewart
					LMSC