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Strategies & Market Trends : Picks, Pokes, Pigs, Porks & The Penis Envy Trade of the Day!
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To: Jorj X Mckie who wrote (44)12/15/2000 3:05:04 PM
From: John Pitera  Read Replies (2) of 111
 
M1 was followed in the late 70's and early 80's but
financial deregulation made it's behavior less meaningful.

As you can see from this 10 year M2 chart, the rate of
change of M2 started to increase in the mid 1990's and
the Rate of change accelerated in 1997 and going into
1999.

geocities.com

The Fed had to bail out the Asia Pacific depression in
1997-98, as well as add liquidity to get the global
economy through the collapse of the Russian economy and
then Long Term Capital Management. The system was shaky
back in that period.

The Fed could not get serious about increasing rates
in 1999 due to Y2K concerns. Companies like XOM spent
$300 million dollars on Y2K remediation projects, so either
A) there was either a legitimate problem that was
handled successfully by industry and Govt or

B)These companies wasted hundreds of millions of dollars,
and companies like XOM and GE hardly ever do that.

NASD 2500 to 5000 should never have happened and would
not have happened if we did not have the specific
constellation of events that conspired to create a
speculators dream and now nightmare.

It's amazing to see people like WCOM's Bernie Ebbers and
many other CEO's get wiped out due to their speculative
dealings. granted Ebbers may be off the hook due to
WCOM coming up with hundreds of millions in loans to keep
him in the game.

This period has been the part of the Macro Long-term cycle
that occurs once every 30 or 40 years.

I'll post some definitions and history of M1, M2 and M3
in a moment.

John
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