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Strategies & Market Trends : Roger's 1998 Short Picks

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To: James F. Hopkins who wrote (292)1/7/1998 1:35:00 AM
From: Dan Ross  Read Replies (2) of 18691
 
I understand what you are saying EXCEPT......with deflation, as many have stated, and the Rf at 5.75% that would indicate that the REAL RATE OF INTEREST WOULD BE 5.75%......Historically this is around 3 - 3.5%......So why is the market at 5.75 and not 3 - 3.5%....inflation worries still exist...however, too many bond bulls are screaming that inflation is non-existent and I differ....once they panic and sell, rates will go back up.....

Regarding your comment about 3% being the max amount for a loan.....I couldn't agree more BUT......WE HAVE OUR GOVERNMENT TO BLAME FOR THIS....NOTHING IN LIFE IS FREE.....Our government deficits and HUGE national debt are to blame....additionally the average U.S. person has 2600 in credit card bills.....basically there is only so much of a supply and a HUGE DEMAND for the money......

If anyone is to blame it is the U.S. consumer for spending WAY TOO MUCH and saving way too little....Additionally, our government needs to start paying off this damn national debt..They don't need to talk about cutting tax rates anytime soon.....DO you leave your credit cards unpaid and just pay interest? That is what our government is doing!!!!!

If our government doesn't start doing anything sometime soon MY GENERATION will pay the price in a HUGE way.....More people will be getting Social security, medicare, medicaid, and there will be fewer people to PAY THE TAXES FOR THESE SERVICES......If something isn't done now you will have generations squabbling with each other....In essence the current generation of 30-50 somethings have lived it up getting huge government spending, lower tax rates, etc at the expense of future generations....

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Dan Ross
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