From: Michael Winn [comcapco@adelphia.net]
Sent: Wednesday, May 25, 2005 5:43 PM
To: gsg@sellnext.com
Subject: COI

Gary,

Among my friends is a guy I’ve come to respect as a straight-shooter, worldly and honest guy who is experienced and knowledgeable in these matters, where I am not. So I sent him this one sentence and asked for his response. Note that he has served as a consultant to the Federal Reserve Bank, and in particular, Paul Volker and Alan Greenspan. I consider him a friend—not a close friend—we have some things in common. We’ve met each other’s families. We’re on the same side of most issues, especially these Del Mar and San Diego and population control issues, but we don’t hang out and play together.

“Are Certificates of Insurance included in the Money Supply numbers and if not why not and if so how does Fed Chairman Alan Greenspan keep a straight face?”

No.  It makes no sense.

In the first case, there are multiple measures of money supply.  In addition, monetary policy can and sometimes does target these monetary aggregates, but also can and often does target levels and trends in interest rates (primarily affecting short rates and only indirectly long rates through inflationary expectations).

Money supply is in concept a way to think about transactional balances, not other forms of wealth.

I’d appreciate hearing your response to this.

Yours, Michael Winn