Thanks LG and others for the best thread on SI...
right now, in this market, the most urgent question is overall market levels -- and that will determined by the Fed, if the Fed wishes to determine it.
personally, I don't think the Fed wants Options Jerry to buy an island or a helicopter. (no offense, man...I love your posts!!)
with y2k coming up -- an event that could be a slight bend in the road or a hairpin curve with cliffs on both sides -- I can't believe that the fed wants this market barreling along at 120 mph filled with ever-richer giddy part-goers.
the fed is now facing a market that laughs at "being talked down," laughs at ever-rising TYX, laughs at valuation concerns, laughs at historical comparisons, scoffs at the notion that money in equities is "money at risk," is subliminally sparked by "HUGE RALLY!" micro-sound clips on CNBS between parades of stock pimps who "really like AOL here."
the fed must realize that inaction will give this market license to destroy itself -- and much of our economy -- in one last final orgy of greed. and they must realize that a 1/4 point hike will also be laughed at -- after possibly a ten-minute 20 point "sell-off."
a 1/4 point hike with a statement that "more tightening will probably come" would be better...but I wonder if it, too, wouldn't be shrugged off.
only a "just market" is a safe market; and for that we need both fear and greed, in proper proportions. a hike of 50 basis points might help bring that about; I really believe that the fed needs to slam a plank between the bull's eyes before it tramples the savings of millions of Americans -- which it will, if left to run wild. does anyone really believe that Greenspan wants to see Dow 12,000 this year?
do I really believe the fed will do what they should? I wish I did. I hope they do.
ps -- The Naval War College has put together a y2k report that's fascinating and scary. recommended to anyone who thinks "y2k? what a joke!" it's at:
geocities.com |
