February 12, 2001, 3:42 PM — I'm creating my own church: The Greater Church of Greenspan.
To start, you can worship Alan Greenspan without anybody asking you for money (and isn't that novel?) Plus, his two recent rate cuts (now at a full 1% in the last couple of months with every indication that another will follow in 6 weeks) are actually giving money to the people who need it -- you, me and every business out there.
While most people across the country are looking at the impact on home mortgage loans (especially all those laid-off dot-commers), the cuts will help both networking vendors and you, their customer.
Networking businesses (especially stable ones) will find loan money cheaper. And that gives them more money to invest (who wouldn't rather take out a low-interest loan than raise additional capital from venture sources?).
The lower rates help you because, most obviously, it reduces the rates you'll have to pay to finance large networking purchases (indirectly, of course, there's the overall macroeconomic stimulus of lower interest rates on your employer).
And finally, lower interest rates should hopefully boost general consumer confidence, which means increased spending for all things that networking technology is part of.
All you pessimists need not worry: The rapid reduction in interest rates means Greenspan is highlighting the fact that we're on the verge of a recession. If even the Mighty Greenspan thinks we might be in trouble, will mere mortals react by withdrawing into their shells, rather than engaging in a little irrational spending exuberance? Even Wall Street, which usually acts giddy in the wake of rate cuts (since lower rates mean lower returns on traditional savings accounts -- which make stock market returns look more favorable) seemed more confused and concerned than usual.
And if we do in fact slip deeper into recession, we can only hope that these rate cuts and Mr. Bush's promised tax cuts are enough to turn things around. So join me in praying to Mr. Greenspan for yet another rate cut in 6 weeks.