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Pastimes : The Justa & Lars Honors Bob Brinker Investment Club

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To: Justa Werkenstiff who wrote (10261)12/5/1999 1:55:00 PM
From: marc ultra  Read Replies (1) of 15132
 
Justa re<<<I guess I understand why there will not be a bear market before the end of this year <g>.
Let's face it though. The folks most worried about Y2K reside at the Fed.>>>>>

This could set up some very interesting dynamics. Let's say this short term flooding of the money supply keeps the party going through the end of the year and perhaps the beginning of 2000. Then at the same time that we should be seeing the end of y2k relief rally money what will the Fed be doing? Assuming the economy should remain red hot and the market will be pushing new highs they will probably want to drain that injected y2k money as fast as they can. So lets say sometime very early in 1998 we should have the markets pushing new highs, bullish sentiment at extreme levels while the Fed will be trying to cut the money supply sharply and we will be seeing that early year profit taking. Sounds like the set up for possible major problems in the market.

Marc
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