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Pastimes : The Justa & Lars Honors Bob Brinker Investment Club
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To: Greg Jung who wrote (6282)6/25/1999 9:44:00 PM
From: Justa Werkenstiff  Read Replies (2) of 15132
 
Greg: Re: "I highly doubt that total market "timing" as you propound will have much, if any, effect on your finances long term. Probably only delay their appreciation. Least of possibly profitable approaches is to try to follow, on a daily basis, a 'market timer.'"

Brinker is not a daily market timer. His model is based on long term market timing trends.

Re: " I think the best that could happen would be a 1/2 point increase and removal of the bias."

Nice to hear what YOU think BUT Greenspan has only prepared the market for a 25 basis point increase. He has historically been a gradualist. He is a 25 basis point man and has always been one. That is what "modest" means to the Green man and that is what it means to the market. If he does something greater and contrary to what the market expects, you might feel better but the markets will be totally confused and Greenspan will have lost credibility. You do not want to lose credibility when you are in Greenspan's slot. Big mistake for his career and for the markets.
Huge disaster.

Take away the bias? You might as well say you are not going to send ground troops into Kosovo. You never take away your options if you are not sure what you are going to do and Greenspan does not know what he is going to do because the economic data is always flowing and right now the flow points towards a tightening bias. The Green man is not going to risk losing credibility with the markets by having to do an about face if data does not support a neutral stance later. Hard to believe that the data is going to change between now and next week.

Re: "1/4 point, retain bias - not enough, no closure to issue"

Not true if subsequent economic data supports only one rate increase at this time. Otherwise, you are just going to have to deal with the uncertainty. Welcome to the stock market.
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