Ed,..Re:.***OT***
Re:.my comment wasn't directed toward market indices, but toward real day to day business....higher cost of borrowing, either lowers profit or passes on to consumer..
But how did businesses go on to have good earnings and therefore propel their stocks to new highs if they didn't allocate the costs of that capital in an efficient manner? When costs of capital are increased, business finds better ways to use it. The only reason for tightening previously was to ward off inflationary pressures. Now maybe they've overestimated these pressures but in the end, May 6th, 1999, look where the market is.
Re:.when money became a controlled commodity it eroded our manufacturing base for the "commodity" could give a better roi than the ability to expand production, and pushed us to a service type economy.
I disagree here since I think that the smokestack economy was doomed the same time Moore's law became popular. Technology has resulted in the growth of our service economy. Information Technology is included in the services economy and we export these services and they are high margin, high price, high ROC services. This evolution has also allowed significant market gains, higher tech job growth, and allowed the US to be the island of prosperity when the rest of the world was still dependant on manufacturing economies.
Again, JMHO <g>
Lee |
