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Make this a diary. I was going to reply along the lines of
No, no, no, no.

Relaxation of lending standards and margin requirements make bubbles. Low interest rates have nothing to do with it. You get bubbles at 7 % rates. You get bubbles at 3 % rates. You get bubbles at 0 % rates. Hell, the broker's rate touched 12 % for a while during the spring of 1929. When you have that sort of short-term returns to speculative activity, fiddling with the rediscount rate barely amounts to a rounding error.

but you beat me to it.

Economics is politics by other means
by Carrie (migeru at eurotrib dot com) on Tue Apr 26th, 2011 at 12:06:43 PM EST
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