if you mean a positive buyer rally within Big Bear
then yes, I expect that
the Federal Reserve infusion of money supply
plus the sharply lower rates
will produce a spurt of economic activity
not to mention the lowered household costs from refinances
but I expect effect lower costs to be confined largely to households
since corporations have seen corp bond yields actually rise
with all the uncertainty
their borrowing costs have risen (just when they dont want it)
bankruptcies are a real threat
e.g. Bessy Steel, Polaroid (Xerox next?)
small companies will see lower borrowing costs though
since they deal with banks
have Venture Capitalists gone into hibernation?
but all in all, I expect the severe overcapacity issues to stick around for several more quarters
also, the war will make the govt a net borrower
that will not help interest rates
and the war will add some "taxes" to the system
like security costs, longer and more costly transportation, thus bigger inventories
we are likely to see backtracking in JustInTime Inventory systems
with longer times in transporting, from more checkpoints, more thorough inspections
so by mid/late 2002, a stall in the economy again
actually, in several months I expect a massive confrontation with Saudi Arabia
it will focus on terrorist, recruiting, funding, our Prince Sultan airbase, cooperation with investigations and flight lists
as a result, I really think we are likely to see an allout effort eventually to limit MidEast oil imports
we will be asked as a nation to endure higher oil costs in exchange for greater reliability of oil supplies and higher cost
this will act as another security tax, and slow the economy's recovery
just a view from the eye of a jackass
/ jim |
