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Politics : High Tolerance Plasticity

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To: kodiak_bull who started this subject	2/2/2003 1:40:42 PM
From: Steven C. Vartan	Read Replies (1) of 23153

Economics ramblings: We have gone in a relatively short period from deficit busters to deficit hogs, the fed has lavashed liquidity and low rates on home refi, the dollar has gone from strong to weak against the Euro. If you look at Mr & Mrs Consumer as a minibusiness they have has a great burst of liquidity thru refi of the casa and their cash flow is great. Lower or no bonus this year but cash income from jobs goes futher due to lower payments on the new mortgage. Now for the rub: 32% less buying power Nov/Mar due to higher energy prices, double whammy of higher product prices due to dollar devaluation and higher oil prices which transport or go into the product. So unless I am missing something the retailers should have a tough time where even if the top line goes up it is a pass thru to the chinese or other off shore manufacturer. On another subject apparently a big percentage of the recent selling has been done by off shore investors. In Euro terms the S&P is now below the oct low (14% deval). That explains why MSFT and KO have been performing so punk lately (they are the darlings of the offshore folks).

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