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Strategies & Market Trends : Three Amigos Stock Thread

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To: Ditchdigger who wrote (10163)	11/10/1998 7:17:00 PM
From: Sergio H	Read Replies (4) of 29382

<Suppose rates don't get cut,then what?> Elementary my dear DD. The market believes that the Fed will cut rates even if they don't do it next week. Here's the proof: Compare the 3 month T bill rate = 4.44% decisionpoint.com to the Fed discount rate = 4.75% woodrow.mpls.frb.fed.us The market sets the rate for the Tbill and the Fed follows. There is rarely more than a quarter point separating the two rates. The current deviation is an excellent indicator that the Fed is going to lower the rates once again. The 3 month T bill has been moving up lately, reducing the divergence between the T bill and the discount rate, because of temporary oversold conditions in the value of the dollar. decisionpoint.com The Dow Industrials are too far ahead of their moving avgs. while the Russell 2000 is just kicking into gear. Barring any new data coming to light, big time rally for the small caps is coming up. Amigo Sergio

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