Was Y2K a total scam.... you know Exxon spent over 300 million dollars in hardware and software upgrade to remediation issues associated with Y2K. Likewise, just about all large multinational companies did as well.
As has been the case, when you spend newer, faster hardware and newer software it tends to work faster and have more capacity and productivity... It's been argued that one of the reasons that the tech boom was frontloaded ahead of Y2K was that 2000- and to some extent 2001's technology budget was spent in 1999.
The FED waited until we got past Feb 29th 2000, the last possible glitch point to really get aggressive on the bubble via FED Funds, the slope of the yield curve inversion.
Y2K did not live up to the rumors.... Not the way that the dot com tech mania and bubble did..... If Y2K under delivered, the near 90% decline in the NASD and Trillions of dollars of Market Capitalization destruction between March 10th and early 2003, OVER delivered on promises of a mania. However, Greenspan was publically wondering about equity market "overexuburence" as early as Dec 1996.
Very smart investors saw the bubble build for years prior to it unwinding. And Professionals and famous 10 11 and 12 figures (wealth, with comma's) knew they were trading in a exponential blow off, but decided that they would buy the ticket, take the ride and endeavor to get off the Musical chair carousel prior to the Music ending.
We saw bull market savants like Joe Battapaglia, Henry Bloget (famed call on AMZN going to 1000) and Mary Meeker and Abby Joseph Cohen..... some like Battapaglia who was a frothing bull.... never really had a follow up act once the Tech bubble blew up. Bloget seemed able to shift gears
When I think of Yardeni, I tend to group him in with Lazlo Birinyi and Tony Dwyer...... They tend to be bullish often quite bullish and at times excessively Bullish. They are like the Merrill Lynch ads from the 1970's with all the bulls running on the beach and the words spoken ... "WE are BULLISH on America"
The pre eminent global theme that started in July of this year and has taken several months to incubate is that it looks like we are entering a new Global Reinflation phase witness global interest rates go up and the very vibrant bull market move in the US.
I fully expect the $2.4 to $5 trillion of US Multinational money that is overseas, come back into the US, possibly 80% if the congress lowers the rate to 10% to repatriate the money.
What is not talked about is that in 1986 the Democrats and Republicans in Congress worked out a 1 time tax rate of 6.5% for US corporate money that was locked overseas.
If President Obama and this past congress were smart effective leaders... they would have done the same.
Obama..... has never had a clue about Markets, the Global Macro environment of the world and did not have the intellectual curiosity to learn about it...
John |
