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Strategies & Market Trends : The Millennium Crash
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To: Tommaso who wrote (5315)6/9/2000 7:24:00 PM
From: pater tenebrarum  Read Replies (2) of 5676
 
T, doesn't really get me excited to be truthful. if you want to see an example of monetary restraint look at the Swiss money supply data. it's the only industrialized nation that has decided to actually shrink the money supply for a while to ensure the currency's stability.

Al the printer has this ad-hoc method of slowing money supply growth down a bit for three weeks and then let it re-accelerate again as soon as the stock market looks a tad wobbly.

the most pertinent fact to emerge from this recent global tightening cycle is that the pyramid of leverage upon leverage has grown so large that it is barely able to function as soon as liquidity falters a bit. it's like a junkie who's been denied his heroin. credit spreads blowing out everywhere, and as soon as a window of opportunity presents itself, corporations rush to place deals, so they can leverage their balance sheets even more and buy back their incredibly bloated stocks.

there's a scramble to keep the ponzi scheme going, to wit the hype emerging from WS regarding the implications of an economic slowdown.

imo the whole thing has gone too far...the system is sailing towards the next big stress test. soon it'll be peanut eating time for Al again.

did i mention that you should buy the dip? :)

regards,

hb
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