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Strategies & Market Trends : John Pitera's Market Laboratory

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To: Wayners who wrote (4577)	9/1/2001 12:29:24 AM
From: Yorikke	Read Replies (1) of 33421

Yes margins could have been used as a major disincentive for retail traders. Quite frankly I don't know if Funds are allowed to play that fast and loose with other's money. But look at all the profit the financial industry was reaping from this trade. At the time these people were in a very good position to influence. The fact is that if the FED had been doing the job it was designed to do, it would have jacked margin rates, it would have let the collapse of hedge-funds become much more of a problem before stepping in, if at all, and it would not have printed money like productivity was dependent on the speed of the presses. Furthermore the cheer leading squad would have been told to act like central bankers and simply worry about the lint on their ties. ''I also think that credit acceleration and deceleration is the cause of the business cycle.'' I would agree if we are talking about the medium term. I would tend to look to the demographic model of investment as the reason for long term trends. We are bound by who we are and what our bodies have decided to do with us. Since in the end we are all dead, we must all some time or other begin to face that reality. Financially, for most of us, that means cashing out of the game. What we leave to our heirs is likely to get burned up quickly as they establish themselves. Given our population distribution this means net disinvesment in the next 20-40 years.(or sooner if one still thinks that it is sex, drugs and rock'n'roll that centers existence). Message 16274930 We have in many ways managed to trash much of the investment potential of the nation by the Viet Nam War, the Savings and Loan Fiasco, and now whatever comes out of this cycle. This last is simply a response to the end of the Cold War. In twenty years the young may ask 'What did you do when you won the Cold War daddy?' . The answer will be that we threw one hell of party and got high on money. .....ahhhh for the era of just doin a number and tryin to make clouds disappear!

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