Stocks Crossing The 13 Week Moving Average <$10.01 Message Board

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Strategies & Market Trends : Stocks Crossing The 13 Week Moving Average <$10.01

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To: Jibacoa who wrote (9464)	8/22/2001 10:26:51 AM
From: James Strauss	Read Replies (2) of 13094

It seems the market is not having a very positive response to uncle Al's latest cut. Do you think people were expecting more than a 1/4 % cut ? Of course as the Fed's Rate gets lower, are the 1/4 cuts larger or smaller % wise ? <g> Bernard: This is what happens in the midst of the Bear... There is fear of the US and World economy swimming through mud... The difference this time is we are coming out of a huge bubble breakdown... As such, the rate cuts cannot directly impact the lack of demand and huge inventory overhangs... What it can do is lower the cost of money so corporate America can free up some of their cash that was used to pay of debt for capital investments... It also keeps interest rates friendly for people wanting to buy homes... We'll probably need another 3 to 6 months of market churning before the supply/demand elements of the economic equation come into balance... Then the market takes off... Today's disappointing drop off from the early high futures numbers are indicative of the short term fear mentality that pervades the market these days... Until we see resistance barriers broken and support areas hold, we'll continue to see the market experience large outflows of cash... Jim

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