As predicted, Wed Rally. Greenspan rumor surfaced: no reappointment, interest hike Aug 24 ends his reign of terror. No market or business tolerate fear for long, it "secures" itself from it. The Fed's reputation has been harmed long term, 1998-1999 is a signpost of history that the Fed had its day, the future will belong to "private" capital. Capital goes where it is most loved, never stand in front of a speeding dollar bill. The election year already began, and Gore for example, politely said there would be no automatic reappointment for Greenspan, and Greenspan's insulting response was to hike rates...Clinton loves polls, and Wednesday's Rally on the news that the Beige Book PROVED regional USA economy were fine with NO INFLATION also PROVED Greenspan was wrong, is wrong, and the Wednesday Rally in response to that Beige Book report debunking Greenspan is THE POLL that Clinton will follow on not reappointing Greenspan. You can not reward a man who kills off 25-30% of the Stock market, which is over half of the US economy by itself; that is: Punish and Penalty OUGHT TO FOLLOW ANYONE who throws 12-15% of the annual income in the toilet, which is what Greenspan did, all because he is NOT modern in his thinking on GROWTH without limits, which is what the techs and the "Internet Revolution" has done and will do, way beyond the heyday of the 18th century industrial revolution and classical economics that clouds Greenspans outmoded thinking. Despite Greenspan, the other Federal REserve Governors will not go along with him now, but if they do, only European Central banks will win, Asia and the Asian IMF bailed out banks will just squander the Fed Funds monies earmarked by Greenspan for them anyway. The US Dollar was high against the Yen today, but the US Treas dropped from ~6.26% to ~6.21% a wise step in the right direction, considering the price of oil, and dare I tell it, the watchful eyes of the Saudis who are the only nation that have a separate department within the United States Treasury Department. The correction is over, for now until August 24, and then rally the rest of Q3 and Q4.
I am,
Truly yours,
-Crystal ball
P.S. Greenspan can do the right thing, and not raise rates Aug 24, since its already overdone, especially considering the limited supply of internet and tech "labor" is needed no matter what effect general labor shortage perception will have on inflation, when there are no more workers, you can not just grow them in test tubes yet, if true, even killing of their jobs will not stop this market, the jobs will just transfer to larger companies, and hurt small business, and most importantaly this will have no curative effects Greenspan seeks, it will only dry up the tax/budget surpluses...no one benefits from that. |
