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Strategies & Market Trends : Currencies and the Global Capital Markets
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To: Ahda who wrote (2420)2/3/2000 3:28:00 PM
From: Hawkmoon  Read Replies (2) of 3536
 
What this means short term is stock bubble perpetuated. Is this thought right or wrong?

Darleen,

Probably so minus a correction somewhere this year. There is just too much money going into 401Ks and IRAs each year, and all of that money has to find a home.

The real problem for the Fed is that the US economy is really beginning to overshadow foreign economies and suck in even more of global resources. But since everyone wants Europe and Asia to rebound, it is difficult to achieve with the US economy so strong that any recovery elsewhere immediately becomes inflationary as even more demand is added to scarce supplies.

So, IMO, the Fed wants to slow US growth until other economies are able to catch their breaths and properly restructure in order to become more productive.

And don't worry about the lack of a 30 year bond market. The slack will eventually be taken up by corporate bond issuance, where money should truly be allocated to the private sector where it can be properly utilized, not to fund a public debt caused by bloated pork-barrel spending.

But those who were on the wrong side of the market certainly got slammed today, didn't they?.. hehe Interseting how when the bond market was hitting its highs of the day, stocks were hitting their lows. Stocks were sold either to buy bonds or cover short positions in bonds. And then once the rally was over in bonds... stock immediately rose.

Best display of direct linkage between the stock and bond markets I've witnessed in years.

Regards,

Ron
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