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Technology Stocks : Amazon.com, Inc. (AMZN)

AMZN 249.14

+0.3%

Nov 11 3:59 PM EST

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To: Sarmad Y. Hermiz who wrote (103559)	5/17/2000 11:12:00 PM
From: GST	Read Replies (1) of 164684

Sarmad: The trade deficit is just an accounting number -- it does not "accumulate". Taken together with servicing financial obligations, it is part of the current account deficit which DOES accumulate. The current account deficit MUST be financed -- and it does leave a residual -- foreign ownership and financial obligations. These are both sizable and growing at an alarming rate. Failure to attract foreign capital sufficient to finance the current deficit is the nightmare waiting for us some place down the road. With the bubble, we were well on our way to the edge of the cliff. A slowdown in economic growth allows us to back away from the cliff. Ditto with a decline in the stock market -- assuming foreigners take the hint and stop putting money into US stocks. Higher interest rates suck in enough capital to balance the books and cushions the pressure on the dollar from falling interest in our stock market. The likelihood of a global "soft landing" as we deflate our bubble is hard to calculate.

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