Hi Lee...glad you are back....and we all have been thinking about you...
If Greenspan is expecting 3.5% to 3.75% for the year, don't we need to factor out the big 1st quarter (what, 4.2%?)...to get at the "rest of the year" growth...meaning he is really looking for less than 3.5% for the rest of the year?? If, as he has indicated, the economy can run at 3% (with no inflation), would he be prone to act if the economy is running somewhere between 3-3.5% growth? Wouldn't that fall under the margin of error??
IMO, he is not saying anything new today, nor giving any indication of a rate increase, certainly not in August, and probably not the rest of the year (unless we see a pretty significant uptick in his key indicators)..
Given my view that he can only scare, and wants to scare, the markets here (since he won't raise rates...also due to Y2K), Fundamentally, things are great right now...the same people selling today (will be buying the same stocks back in a few days, a week, a couple weeks)..
Fund managers are thinking history here..thinking on locking in profits for 1st 1/2 of year...
However, at some pt., and I reckon real soon...that money will be put back to work.....and probably in the same stocks they are now selling...
Days like this support the wisdom of buy-and-hold (for quality stocks). Dell holding up pretty well. I expect the markets will rally a bit after Greenspan stops (this afternoon)...but we will close down for the day...Dell could get close to even...
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