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Strategies & Market Trends : John Pitera's Market Laboratory

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To: robert b furman who wrote (7287)	1/11/2006 1:24:11 PM
From: Chip McVickar	Read Replies (1) of 33421

Hi Bob, The inversion is an important event.. even if the chorus from Wall Street and its 'talking heads' are leading us to believe... "this time it will be different, " because interest rates are low. IMO... the inversion is a clear indication of imbalance, and if it remains inverted for any substantive period the chance of a economic slow down is increased. It could be a combination of so much cash sloshing around all over the world looking for a safe home that the fed doesn't need high rates to bring in money.. and/or that all that money seeking a home just has to put up with the fact that return on bond investments will just plain remain low...!!! That overall economic returns are expected to remain low. Last year S&P stocks returned 4.9% Average rate on a 6 month CD in December was 4.6% Are these ramifications for general economic prospects...? In any case... as the stock markets begin to receive more money in this next bull move out of this last flat correction we should see serious higher numbers in the world wide indexes. At least until the perception changes. <smile> Here's to 13,000 on the DOW. My Best, Chip

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