Dirk Wright wrote:
> a) lower interest rates, which will result in:
> i) higher inflation
> ii) overheated economy
> iii) stock market downturn
> iv) recession
Hey, wait a minute!
If you lower the interest rates, you will also lower the risk of inflation.
Yes, if you lower the interest rates, you *might* overheat the economy. For
sure it will be a positive effect to the economy to lower the interest
rates.
The stock market will only respond positively to lower interest rates.
There will be the opposite of recession - a boom, or at least a boost.
High interest rates are only to the bad for any economy, and it only appears
when the economy is sick.
High interest rates will increase inflation, recession the economy, make the
stock market go down and higher the unemployment.
--
Regards/
Ingemar Uvhagen
Gislaved, Sweden
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