gimme a break! greenspank and co. (fomc) "strangled the tech expansion with a vengeance the Boston Strangler would have envied."
yes there was a speculative bubble and we all know markets go up and down. but i believe that this stunning decline was man-made. the market bubble would have taken care of itself (where, yes, greed was/is involved). but greenspank and co. killed off the entire american economy...
think back to 2000. he raised rates 1/2% in May even as the economy showed signs of weakness. he then threatened further increases month after month (WHILE OIL/ENERGY PRICES WERE SKYROCKETING!!!) up until December when it was discovered publicly that the economy was not only weak but also toppled. the economy screeches to a halt and IT & telecom spending stops, etc, etc, etc! the whole snowball effect…
here's a quote from a posting i once read...
------
You all know that stock market is a zero-sum "game." For each share being sold, there's always a
buyer. So, you can think of it as rotation of money where each winner begets a loser. So, when
Greenspan spoke of Internet Bubble and exuberance B.S., he was merely warning those few
opportunists that it's time to collect your money and get out ahead of other suckers. It's simple
as that. Greenspan popped the bubble and few that took hint made a killing at the expense of
others who had been trained to "buy-and-hold." In the end, it doesn't matter if NASDAQ goes to
100,000 as long as people believe in the system and the machines that make it work. Internet is
truly a once-in-a-life-time revolution that has changed the world, and NASDAQ 5,000 merely
reflected the potential that everyone saw in this fantastic medium. Greenspan relied on
traditional valuation and failed to see that 5,000 was just a number reflecting investor
confidence. Well, he willed his way until he got what he wanted. He had to spoil the party and
kill the goose that laid the golden egg, and he has no idea how many years of progress he has
turned back. Companies that could have spawned the next revolution might have been killed off,
and others that could have been the next AOL or CSCO had their buds nipped even before it could
even sprout.
And the sad fact remains that it's still a zero-sum game where most investors lost great deal of
wealth while few amassed a fortune. Simply put, NASDAQ 1600 fosters less innovation than NASDAQ
5000, thanks to Greenspan. |
