SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Pastimes : The Justa & Lars Honors Bob Brinker Investment Club
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Justa Werkenstiff who wrote (25)8/16/1998 7:21:00 AM
From: Boca_PETE  Read Replies (1) of 15132
 
Justa & DD: RE: <Lower interest rates mean a lower stock market>:

Interesting discussion. Imho, gradually declining interest rates could gradually stimulate the U.S. economy resulting in 1999 profit growth.
Lower interest rates usually mean HIGHER, not lower P/E's. If the Long bond is breaking records on the downside each day, why shouldn't the P/E multiple be breaking records on the upside each day ?

While S&P Outlook estimates of 1999 earnings appear to be WAY over Brinker's latest estimates for 1999, it would take extraordinary exoginous events for such S&P estimates to be reduced below zero growth.

Message 5498545

From my viewpoint, the big questions are:

- How much effect will falling interest rates have on the P/E multiples ? Will such effect offset the effect of slower growth in the economy and slowing growth in corporate profits ?

- If economic growth picks up as a result of lower interest rates, will our educational institutions produce enough QUALIFIED workers to fill resulting demands for new workers ?

- If not, will regulations for immigration be relaxed to take up the slack?

- If not, will the resulting increases in the price of labor be offset by price declines in other areas of the economy ?

- If not, will wage inflation accelerate causing government action that destabilizes the current sustainable growth trend of the US economy ?

BTW, Congratulations on the new thread. So far, it looks like it's off to a VERY POSITIVE start. Let's hope it stays that way and the polluters that spread unpleasantness at that other place do not find their way over here.

P

Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News