Interest rate rise will trigger market crash / correction Message Board

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Strategies & Market Trends : Interest rate rise will trigger market crash / correction

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To: Sid Turtlman who wrote (3)	2/17/1997 7:27:00 AM
From: Arthur Tang	of 52

Thank you, Sid Rising interest rate has very large impact on corporate earnings. For optimum leverage the loans corporations carry would be 20% of Sales revenue whether it is credit supplied by vendors (some percentage after 90 days)or long term loans by banks or commercial papers. So, it is not FED's interest to punish corporations. But then, FED is known to be foolish. US economy is now perking on demand side, obsolescence and replacement as described by Sloan (Past GM chairman). Japan and Europe do not have economical policies and plans based on O and R; therefore their economy can not be fully developed. Just visit them and you can see all the old everything in sight. No one spends any money at all. It will take America, Inc. to send franchises and to build distribution mega malls to get all those country's economy going. Wall street understood all this, and can encourage american corporations to move forward. No recession in sight if world market is waiting for us. No crash, now or ever, is also because of earnings created liquidity. Corporate stock buy backs. And FED's liquidity in monetary policy.

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