I will preface this by saying that I am not an ecconomist and that a lot of ecconomic theory appears to remain within the domain of those "Ivory Towers" that have yet to see the light of day when it comes to real world pertinance. Perhaps I'm naive, but based upon various reports in the financial media, it seems that one of THE major "problems" with the US ecconomy involves a shortage of a skilled labor/computer literate work force which results in an inflationary provocation in the form of higher salaries. On other levels/issues, inflationary changes appear to be marginal. Now how does raising the interest rates 25, 50, 75, 100, etc basis points going to alter the entry market for these new skilled employees. Raising rates may slow down the demand for loans to a degree, but it will not deter the need to hire new people, unless the fed is interested in smothering ecconomic growth. Was it not Greenspan who indicated that increases in efficiency based upon technicological advances acted as the safety valve for inflation by allowing for increased productivity? Without hiring these individuals that posesses these skills, you will lose the technicological edge that has allowed for these increases in productivity.
As for me, I lost my profit margins by the end of this week with qcom, and compounded my losses by additional purchases during the week, including leaps and short term call buying.
What prevents me from panicking is that the fundamentals of this company has not changed and that the potential for growth still remains.
David |
