Well, you know, we've got a lot of stimulus in the economy already from the tax cut, from the lowered interest rates, and also from the refinancing of mortgages.

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The real reason to oppose increasing tax rates on the wealthy is that it's a good bet they could do more to help the economy if they keep their money rather than have their earnings confiscated by the government and spent on another round of stimulus.

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The real challenge was to model all the interest rates simultaneously, so you could value something that depended not only on the three-month interest rate, but on other interest rates as well.

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Jack Kemp

Every time in this century we've lowered the tax rates across the board, on employment, on saving, investment and risk-taking in this economy, revenues went up, not down.

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When interest rates are high you want the average direction in which interest rates are moving to be downward; when interest rates are low you want the average direction to be upward.

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And so Fannie Mae produces very strong results for investors in - when interest rates are high and when interest rates are low, in recession and during booms.

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Actually, I have been very supportive of a very robust stimulus package from day one. I think this economy has to have a major stimulus initiative because the only group with liquidity is the federal government.

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Homeowners who refinanced their mortgages took out cash and reduced their monthly payments at the same time. Much of the cash obtained by refinancing was spent on consumer durables, home improvements and the like.

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We believe that the Federal Reserve has to carry on with a progressive increase in interest rates as a consequence of the American economy.

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We think if the economy remains weak that we could see mortgage rates trail down and we think that we could see rates below seven percent into early next year.

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I mean, I'm a conservative. I believe that, you know, if you borrow too much, you just build up debts for your children to pay off. You put pressure on interest rates. You put at risk your economy. That's the case in Britain. We're not a reserve currency, so we need to get on and deal with this issue.

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If we don't get this economy going, the numbers that represent this stimulus package are going to be small compared to the loss of revenue to the federal government for our economy.

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Well, I think the reality is that as you study - when President Kennedy cut marginal tax rates, when Ronald Reagan cut marginal tax rates, when President Bush imposed those tax cuts, they actually generated economic growth. They expanded the economy. They expand tax revenues.

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Alphabetic Inspiration

When all else fails
The Economists look to
The alphabets for inspiration
Will the economic recovery be V shaped?
Yes indeed, say the very optimistic
With the stimulus package
There is only one way
That world economy can go and it is up
Not really, say the less convinced
It will probably be U shaped
The down-turn will stay for sometime
Before it slowly climbs up once more
Then come the zigzag theorists
The shape is more likely to be a W they cry
The economy having gone down
Will first go up and then down again
Before moving up with more confidence
Last but not least, are the die-hard pessimists
They believe that the mother of all depressions
Will not end in a hurry and have forecast an L shape
Meaning that, having gone down
The economy will stabilise at the current bottom
Given that the theories have so far
Centred around only four
Of the twenty-six alphabets
There is still plenty of scope for further
Alphabetic inspiration.

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Well, I think as long as people are talking about stimulus, I think the Fed will be thinking about cutting rates because monetary policy is the better way to go because you can turn it on and turn it off.

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And taking more money out of the private economy and having the government perform as it has poorly done with the stimulus I don't think is the right way to go.

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The claim made by Team Obama that every dollar in stimulus translates into a dollar-and-a-half in growth is economic fiction. The costs of stimulus reduce future growth. No country has ever spent itself to prosperity. The price of stimulus has to be paid sometime.

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I'm not sure it's the stimulus money that will necessarily allow the economy to recover. It will help to fortify our budgets, frankly, to ensure that there isn't as much backsliding in the areas of education and healthcare, for example.

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Well, we're just now seeing the reductions in mortgage rates. The mortgage rates are based on the ten-year rate and the Fed controls the overnight or the shorter rates.

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And so we have to be careful with looking at additional stimulus that we don't provoke an increase in the bond rate and then offset a lot of the stimulus we've already got.

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The government must do all it can to help reduce interest rates for business.

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