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Strategies & Market Trends : Gorilla and King Portfolio Candidates

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To: Mike Buckley who wrote (44633)7/18/2001 10:26:02 AM
From: areokat  Read Replies (1) of 54805
 
>>if an investor believes the Fed is going to act the same again with the same consequences, that investor would be nearly crazy to leave his/her assets in the stock market.<<

I agree that the investor should increase cash when the FED starts jacking up rates and yes the FED will do it again. I think that we missed the cue when the FED started raising rates this time around because the FEDs had lowered rates in response to the Y2K scare and most of us thought the FED could engineer another soft landing. The difference was the economy wasn't weak in 98-99 but there were definite signs of economic weakness in 2000 yet AG kept stomping on the brakes clear into November of 2000. The rule of thumb is if the FED raises rates at least 3 times in a short period of time, the market stumbles (Edson Gould in the 70'said that for one). So, in 2003-2004 will the FED do it again??
But I confess, this one went right by me too.

Kat
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