Cohen is bullish because that's the easy and accepted way to be. She sees an opportunity to be right about the stock market and she wants to milk it. This is opportunist and she's confident because it's somewhat contrary since so many say, "the market is too high". As long as the current yen weakness persists, the US stock market will rise. It will rise until it gets up to the down trend and then it will fall. She is headed for disappointment, but they pay her tons whether she's right or wrong. This is the way it is for executives and others belonging to the privileged elite. So why not try to assess the sentiment and go contrary to it? She has nothing to lose.
I don't agree about the gravity of Y2K. If tangibles are rising in Dec 1999, can you conclude that it is because of Y2K? The Y2K problem is being addressed now. When people do something about a developing problem, the problem is defused. The biggest issue remaining about Y2K is legacy code. Such code should have been changed long ago. Those who use it are being forced to upgrade and hence will benefit from the so-called bogey of Y2K. Further, the breakdowns that occur from failure to upgrade will introduce a cleaning out process. A lot of useless junk will be tossed especially tired old records when the clock strikes twelve. So probably more good than bad will come from the millenium change.
Technology is over-built and over-blown. For example, who needs ever faster processors? My 166 speed is never an issue. All the busses are the problem. I know, you're programmed to have an insatiable demand for speed, but you're not looking at it objectively. I've preached before that INTC has a major problem of this nature. Who would think that it could be a problem? But I believe the reality of this problem is the root cause under all the other problems they're experiencing. Other technologies have similar problems and their growth rates will slow. The Schumpeteran notion of the destruction of the inefficient is way overdue for many sun setting technologies. On the other hand there are exciting technologies that have just been born, so what you say is both true and false.
There is almost no conceivable scenario where the US would buy or sell gold. You aren't understanding the history of gold and the development of the FED. Significant gold history starts with the Civil War and the FED starts with the Panic of 1907. Study them.
I will say that gold is the de facto arbiter regardless of the pleadings to the contrary by liberal bleeders. Gold is the true shadow open market committee. If FED makes errors, the open market changes the convertibility rate of dollars to gold. The FED doesn't need to enter the gold market to make any adjustments, the market does that for them. In fact, the most important indicator for policy is the price of gold, but no one there would care to admit it. That's why it isn't a good investment. I hold it now because I believe the FED is making a major mistake and the mistake is very difficult to see. That's the nature of big mistakes. I suggested above that that's why the Y2K thing isn't as bad as it could have been. The error FED is making should make the price of gold run hard to the upside. |
