Thanks for your bearish opinion on the DOW. I share it! Moreover,
I'm short American market, and plan to stay short until it declines.
It may surprise everybody and go up, though, if the low rates have
more of an impact than asia.
Thanks for your view on the Russian market as well!
However, fundamental picture for Russia is completely different
from the American market. US enjoyed an economic boom (related to
huge progress in computers and huge earnings growth), which has
considerably escalated in the past 3 years. Russia, on the contrary,
collapsed since the cold war ended. GDP declined to 1/2 of 1987
value. The market cap is only 40 bln.$ Net foreign
investment is around 9 bln.$ GDP is 420bln
$(798 bln $ according to CIA(?) country info).
They are running at a trade surplus of 14 bln. - so, I guess, they
can live without those foreign investments.
I just can't believe that the new capitalist society in Russia
won't be able to surpass Brezhnev-era lazy GDP levels.
The story is as follows: due to recent domino effect of SEA currency
devaluations Russia had to raise % level on GKO from around 14% to
32%, if I remember correctly. And still investors were afraid.
I don't see the ruble collapsing - yet. I guess, they don't care
as much about some huge market on the other side of the earth as
about the fact that the ruble is back to 6 roubles/dollar, spring
1991 level, only after eating up three
zeroes. As for the american market -
Greenspan and K will do everything in their power to prevent an
an economic collapse. After all, the market can fall
in real terms, while remaining at the same level in $
(a la 68-82 stagnation), and keep
the FED busy printing money. This, I guess,
will be the goal of the FED. In this case US bulls and bears
will lose. Japanese market, on the other hand, considerably
increased in 68-82. Russian market might also do just that.
-Vi |
