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

AMZN 220.65

+1.6%

3:59 PM EST

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To: Mark Fowler who wrote (113401)	12/25/2000 3:55:48 PM
From: GST	Read Replies (2) of 164684

One of the things people forget is the impact of the dollar and the current account deficit and the trade deficit. The dollar going lower will help to balance the trade deficit, but the current account deficit, which has been offset by capital inflows into stocks and bonds, will reinforce the pressure on the dollar sending it lower. Lower interest rates will make the dollar less attractive. All of these factors can converge to produce an economy which is struggling to close a $500 billion trade deficit amidst a falling dollar and lower interest rates. The net result is likely to be a marked pick up in import prices -- inflation. This will temper interest rate cuts beyond the initial 1/2 point move. It is fine to talk about how healthy the economy has been -- but it is not fine to ignore how out of whack it has been for several years. We are going to pay for it now. The new economy stock market bubble will be one of the most hated features of the excesses which peaked last March. It will come to represent everything that was wrong with our economy.

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