Strictly: Drilling and oil-field services Message Board

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Gold/Mining/Energy : Strictly: Drilling and oil-field services

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To: SliderOnTheBlack who wrote (71746)	8/27/2000 1:45:39 PM
From: BigBull	Read Replies (2) of 95453

Slider - The perfect storm? Yes it's coming, and so is the Mother of all Bear markets. The key question is when? Some articles to ponder: yardeni.com What the author of the article you posted neglected to point out was the plunge in govt. borrowing. And while the, increase in consumer credit, the sub prime lending IS a concern along with the savings rate, what is somewhat heartening is that the biggest and most non productive users of capital - the US Govt. - is disappearing almost over night. Now about productivity and inflation. Recent productivity gains in the US economy ARE NOT TRIVIAL. IMO those who overly discount them are making a huge mistake. I cannot say that more unequivocally. Take a look: yardeni.com It is clear from the above story that a tremendous amount of the borrowing from corporate entities is to upgrade and update current existing capital plant to make them ever more efficient. Will the rest of the boom until 06 - 10 or so be inflationary? Most definitely. But I see a slower rise than perhaps you do. I still agree with Wolanchuk on this one, from here on out inflation will continue to rear it's ugly head, but the boom is not dead by a long shot. Here's an interesting economic cycle/stock cycle view. I think it shows well that the markets have discounted "recession" and that "early cycle" stocks are leading the way for a resumption of the bull market. Note the lag between the economic cycle and stock cycle. The economic "news" will probably show more weakness going forward as was evindenced by the durable goods orders. Pricing pressure will also moderate a bit - sans oil of course. Don't get me wrong - oil is important - but is not everything. This will lull the market to sleep for a few months, but then the flip side of a soft landing is... stockcharts.com I think the marketplace is our best vehicle for timing bull and bear cycles, not gurus. So far the market place is signalling a new leg up. The across the board breakout runs in all interest rate sensitive stocks signal clearly where we are. BTW I expect them to aexperience a little dip soon, as they are very extended. Could a derivatives bomb hit the market - oh surely - and we must all keep on the look out for one. Thanks for reminding me. In closing, please know that I am no Pollyana and will keep a sharp eye out for the things mentioned in that article, especially the risk imposed by derivatives. Also, I am keeping a close eye on developments in Korea. They seem to be running into some big bumps resolving the Chaebol debt problems.

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