Don't tell the traders on Wall Street because the way things are going these days, it might be enough to bring on part two of "Black Summer '98," but big-gun national economist Daniel E. Laufenberg doesn't expect the Federal Reserve to lower interest rates anytime soon and would advise the Fed's board of governors against doing so.

Why should we care what Laufenberg thinks? Because along with being the chief economist for American Express Financial Advisors, a frequent quotee in the Wall Street Journal and New York Times and a former Fed economist, his opinion carries more weight with Fed Chairman Alan Green-span than, for example, mine.Laufenberg's view might roil the markets because many stock traders are convinced that a recession is waiting in the wings and that means the Fed will likely soon lower interest rates and the market loves it when that happens.

On Sept. 5, Greenspan said in a speech at the University of California, Berkeley that, "It is just not credible that the United States can remain an oasis of prosperity unaffected by a world that is experiencing greatly increased stress."

Traders somehow interpreted that to be a signal that the Fed would soon lower rates and after the three-day Labor Day weekend sent the Dow Jones Industrial Average up 380.53 points on Sept. 8.

If they thought rates weren't headed down after all, they would be upset, and we all know what happens when stock traders get upset. Uh-huh, it's "Black Wednesday" or "Bloody Thursday" or some other unpleasant day of the week that takes our retirement funds back to where they were in 1994.

"Everyone is expecting the Fed to ease (interest rates)," said Laufenberg in an interview with the Deseret News Tuesday before a speech at Westminster College's Gore School of Business. "They say, `What does the Fed have to lose?' "

With the dollar weakening, wages rising and commodities prices bottoming out, Laufenberg believes the Fed has a lot to lose by lowering interest rates: rising inflation.

Greenspan and other Fed chairmen going back to the double-digit inflation of the Carter administration in the 1970s have made no secret that they view inflation as public enemy No. 1 and will do just about anything, including risking a recession, to avoid it.

But lower interest rates or not, Laufenberg said he believes the worst of the summer stock carnage is over.

"That doesn't mean that we couldn't have another surprise somewhere, but you have to focus on the long-term trend and it's favorable for U.S. stocks. The key is whether we have a recession."

But Laufenberg doesn't believe the R-word is in the cards for the United States this year or next.

"There is a growing concern that we are heading into a recession because of what's happening around the world," he said. "We're not immune to those forces, I think we'll be affected by them, but not enough to bring on a recession. Once that's obvious, the (stock) market should react favorably."

Commenting on President Clinton's problems, Laufenberg said he believes they are impacting the confidence of international investors in U.S. securities more than they are Americans, causing them to pull their money out of the U.S. markets in favor of other countries, especially those in Europe.