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[oneliner] 03/1/2001 20:56

Bush says Fed rate cut 'not enough' to stimulate growth


Date: 03/01/2001 20:33
AUSTIN, TX (AFX) - President-elect George W Bush said the Federal Open
Market Committee's decision to cut the federal funds rate to 6.0 pct from 6.5
pct was "not enough" to stimulate growth.
He said his across-the-board tax cut will also be needed to help the economy
recovery.
After a closed-door economic forum with prominent businessmen, Bush was
asked if the Fed's rate cut would make it harder to gain Congressional support
for his 1.3 trln usd tax cut.
Bush replied, "not in the least."
"I think if you were to talk to business leaders here, they would tell you a
rate reduction of one-half percent is not enough to serve as a stimulus to
encourage capital formation, economic growth, job creation," Bush said.
"It is going to require not only monetary policy reform but also fiscal
policy reform," Bush said.
Bush said his tax cut proposal was "an integral part of economic recovery."
He said the business leaders told him "bad news" about the health of the
economy, "that their sales are slowing, they are having to trim back their
workforce."
Bush said the FOMC rate cut was a "bold step" and said he planned to "take
another bold step to ask Congress to work with us to enact tax reform and tax
reductions."
Jack Welch, the chairman of General Electric Co, said that there has been "a
significant slowdown (in the economy) in the fourth quarter."
"I think the move by Mr Greenspan was welcomed by everybody here," Welch
said.
Separately, Bush named Lawrence Lindsey, his top campaign advisor, as
assistant to the president for economic affairs.
gar/pav/


For more information and to contact AFX: www.afxnews.com and www.afxpress.com

[oneliner] 03/1/2001 20:39

Rally continued after lessening a bit by 7.15pm (momentum driven waves), a resurgence after Bond markets closed at 8pm GMT to see Nasdaq 100 up 370 and Nasdaq Composite up 298 on volume of 2757305 (quite a lot) and DJIA up 298, S&P +63 (8.38pm GMT).

[oneliner] 03/1/2001 18:54

rally dying down?

[oneliner] 03/1/2001 18:37

The Nasdaq Composite also reversed a fall to ride up 250 (18:38 GMT).
The Nasdaq 100 had a higher jump, of over 300 points.

Huge rallies are not unusual in bear markets I have to add. Question is, is this nearing the end of the bear or just a bear rally?

( for latest see )

In a nutshell: Question is, will this make a sustained rally?

And will they later say "Things must be grim if taking this action"?

Will sentiment now at least make for a less volatile market if some action is taken to stem the supposedly slowing US economy - a mentality that it'll be as broad as its long if interest rates come down by 50 basis points?

Over to you for comments...