LETTER: FED'S DECISIONS SHOULD ENCOURAGE INVESTING IN AMERICA'S FUTURE

To the editor:

There are several factors contributing to support for the Federal Reserve's decisions to raise interest rates:

1. The surge of the 4.5 percent annual economic growth rate in the final quarter of 1994 was fueled, in large measure, by consumer spending.

2. Consumer spending in the final quarter exhibited a high percentage of credit buying.

3. Much of the goods bought in the fourth quarter was improt goods, contributing to an increase in the deficit of payments.

4. Continued increase in the deficit of paymentds, combined with the continuing federal deficit, requires increased financing by domestic and foreign financial institutions.

5. Inasmuch as investment in various foreighn and worldwide enterprises is offering increasingly attractive returns, loans and bonds to continue funding the American debut must offer more attractive returns as well.

the Fed's strategy, hopefully, will put some damper on America's burgeoning overall indebtedness, while providing enough encouragement for large interests and financial institutions to continue investing in the futuer of America.

GILBERT DEGENHARDT

Cape Girardeau