DD, Are you in your attic today doing research? Very Interesting (with German accent).
As you know, I have my father coming to visit me for the week tomorrow. You've set the scene perfectly for me on a little family history and the internet as a research tool. Last time my father visited, we researched the history of the Brady bond, while we did some daytrading. I think that this visit, I'm going to take him on at least one field trip.
On another topic, I thought this also Very Interesting (also with a German accent, considering the source of the quote, Ed Yardeni):
<Y2K: I am impressed and pleased by the smooth transition into 2000 so far.
At this time, there are no significant Y2K problems around the world,
especially in the late starters. As a result, the risk of disruptions to
global just-in-time supply chains, which has been my number one concern,
seems less likely. Nevertheless, the risk remains that some of these systems
might still experience malfunctions and failures in coming weeks. If no
significant problems occur by the end of January, then I will concede I was
wrong about a Y2K global downturn and change the odds of a
recession-vs-expansion from 70-30 to 30-70. The IT community deserves most
of the credit for the uneventful century date change. John Koskinen, the US
government's Y2K man, was especially effective in coordinating the Y2K
remediation process both in the United States and around the world. Looking
back, I certainly don't regret my efforts to raise awareness. Y2K was a big
problem. Hopefully, it has been mostly fixed.
COMMENT: If Y2K remains a nonevent, then why assign any odds of a recession
this year? Good question. My year 2000 recession forecast was based on Y2K
disruptions bursting the speculative bubble in the stock market. Of course,
the market is less vulnerable if there are no disruptions. So, the bubble
could get even bigger. High valuations may be justified to a certain extent
by the New Economy fundamentals of strong growth with low inflation.
However, tech stock prices are soaring to levels that only make sense in the
"Yahoo Economy." If Yahoo is worth $400 per share today, why not $1000?
SUBSCRIBERS: In "Millennium Meltup Or Meltdown?" (GLOBAL ECONOMIC ANALYSIS),
I discuss the possibility of a Clash of the Titans between Silicon Valley's
Masters of the Universe and the Bond Vigilantes. The government bond yield
is near 6.5%, a critical level. If the tech stock meltup continues and the
economy continues to boom, the Fed might raise rates again in February. In
this Y2K-OK scenario, the bond yield could also meltup and burst the bubble.> |
