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Technology Stocks : Amazon.com, Inc. (AMZN)
AMZN 227.90+0.4%3:59 PM EST
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To: tonyt who wrote (31300)12/27/1998 5:10:00 PM
From: Gary Walker  Read Replies (2) of 164684
 
> Do you think he shouldn't have?

The Fed's actions have seriously undermined the economy. They prevented a disaster in the markets this fall, but went too far and have created a base for an even larger bubble and an even bigger fall later.

The emergency discount rate cut IMO will be discussed for years. Japan never recovered after the great crash in their equities. The US took 25 years to recover from the crash of '29. You can argue both ways. The fact is that the economy is much stronger than the fed anticipated when it cut rates. Whatever slowdown occurred it was very short and very local.

I wouldn't be surprised if Greenspan someday admits to making a mistake. He may also make a plea for reason in the internet valuation markets. (But please no more irrational exuberance comments!) Perhaps the fed will tighten margin requirements on the net stocks. In any case, he may be reluctant to make another "mistake."

Anybody long in the net stocks area should be prepared to hang on for the long haul. What isn't already priced into stock like EBAY, AMZN, YHOO? What value either real or perceived isn't already priced into these stocks? We're talking $50 billion in value!

Someday "valuation" will take over from blind speculation unless this market has entered into the Twilight Zone. If it has then the Fed and Allan Greenspan have only themselves to blame.
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