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Technology Stocks : America On-Line (AOL)

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To: Steeny who wrote (15557)	5/7/1999 9:54:00 AM
From: Tunica Albuginea	Read Replies (1) of 41369

Steeny, that is right. Bond fellows are an extremely sensitive group of people. Most I believe were children of the 70s <g> and well remember the old Fed moves of raising interest rates when the economy was strong.They have remained uncomfortable for the past 20 years with the new paradigm of strong growth low inflation. Bondsmen are looking for whiffs of inflation under every boulder these days. In the last month these rumors are a little bit stronger. As I drive by I see lot of " help needed " signs; " no experience needed ".Even pre employment drug testing has been scrapped. Here at my hospital they are putting low skill nurses with lower pay scales to do higher skill work in Intensive care units and sort of " learn on the job"; very dangerous Folks on welfare are now working. We have used just about everybody. So were are the new workers going to come from for this strong economy? Are wage increases next?This is what Bonds fear. Also we have oil, and an apparent new resolution from OPEC to make reductions stick. Going into high travel season oil may go up further. Abelson had an editorial about 6 months ago saying that OPEC engineered oil price increases could be what topples this bull market. If there is a recovery in Asia then that may also raise oil prices and prices in general. And finally Greenspan yesterday said that the Fed now has a " new bias toward higher interest rates "So lots to worry about.I wonder if bonds they ever get any sleep <g> TA THIS ARTICLE IS ORIGINAL % COPY RIGHTED!!!!!! =================================== you said : " I can't really figure out why bonds are selling. It could be that those who went long before the # are locking profits and this will be short-lived. The only other idea I have is that bonds are unpopular at yields under 6.00% Greenspan has inferrred before that one reason the Fed has not had to raise rates is because bond yields have corrected themselves. Bondtraders may be reading this again and driving rates up. Just theorizing. Anyway a bond selloff will not help us today.

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