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Technology Stocks : Intel Corporation (INTC)
INTC 40.51-7.4%Dec 4 3:59 PM EST

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To: Amy J who wrote (144073)9/25/2001 1:08:00 PM
From: Saturn V   of 186894
 
Ref < I see inflation as the worst enemy to an equity holder. >

Yes inflation is the biggest threat ! The Fed is busy trying to revive the floundering economy, and the danger is that is that this will have long term inflationary consequences.

And the conventional wisdom is that wars are always inflationary. Desert Storm was an exception, but all wars, the Vietnam War, World War I & II, have always been inflationary. The reason is simply that Wars tend to be financed by major budgetary defecits, and sure enough we are headed in the same direction.

At this point in time we do not know what kind of armed conflict is in the cards . And everyone appears to think that it will be a short localized conflict. I am also hoping that it will be a quick military action, which will not be a drain on the countrys finances.

Historically the best hedge against inflation has been gold or real estate. In the past in situations like today, the price of gold would soar. However today everyone is fixated upon the last war i.e Desert Storm and the allure of gold has faded.
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