Dale, I will chime in about CAMP and about the economy. CAMP is in a perfect position to turn around. It has weathered tremendous storms,and the near total collapse of its market,and increased its cash position WITHOUT issueing any shares! They bought out a privately held company called Gardiner which sells Satellite receivers with cash! Not funny money Yahoo shares,not a pooling of interest,but cash! Gardiner has been immediately accretive to earnings,helping to propel sales this quarter with only 5 weeks on the books! Now,the event that will really propel CAMP is going to be the return of MMDS sales,and its reinvention as a last mile 2-way technology. They have one of the only 2-way systems going in America right now,and that one is for Videotron in San Francisco. Videotron was just bought out by Sprint,though the deal has not passed FCC regulations yet. Sprint is planning on using MMDS as their last mile technology for their ION networks. Esrey has stated where he has the spectrum he is not going to persue xDSL from the RBOC's. There is some great articles from Sprint CTO about using sectorized MMDS as a last mile technology,and 20% sectorization increasing bandwidth 5 fold. CAMP is sitting pretty,but MMDS sales,and turn around should not be until the fourth quarter of this year when Sprint clears all the hurdles. MCI is not planning on deploying MMDS technology,their purchases of MMDS was to block Sprint from acquiring the spectrum for the whole country.
Now onto economics,by the TED spread and the TIPS,the current long bond is pricing in about 1.8 percent inflation for the next decade. About 6 months ago, the long bond was pricing in outright deflation. This information can be gotten from
ms.com
look for Stephen Roaches comments. In my opinion,the Fed has pumped way too much money into the economy,and cannot get a good handle on it,since so much money has moved abroad. Greenspam's experiment into saving the world economies is going to backfire big time. His role was and should be to protect the currency of the US. He had no right,nor obligation to save the world,it is not his job. Now he is in one heckuva bind. If the Fed does not tighten at the end of the month,bonds are gonna tank. He will look like he is no longer vigilant on inflation. I expect a series of quarter point increases starting this month or maybe next. I expect at least 3 of them,since he has to inflate the money supply going into Y2k.
dailynews.yahoo.com
Hays also said the market is no longer operating under the near-perfect climate because of a policy shift by the Federal Reserve.
During last summer's global crisis, a panicky central bank rushed to build a firewall to protect the U.S. economy from the crisis in one-third of the world's economy by flooding the system with money.
''The excess money was much more than the economy could stuff down, so it quickly spilled over into the U.S. bond market, driving the interest rate of the 30-year bond down to 4.7 percent,'' he said.
But the Fed has since taken the punch bowl away. The money supply, which grew at a tremendous pace of 12 percent last year, is now increasing at a snail's pace of only 4 percent. And, over the last four weeks, the money supply growth has actually decreased for the first time in three years.
Now onto markets,and how they react. You are seeing the first stage of market corrections. They work by the Theory of Pragmatism,the weakest going down first,the strongest last. We are seeing the weakest stocks in the most extended groups starting to erode quite viciously. UBID and ONSL are getting crushed,EBAY is still holding its own. SOFN has gotten crushed from 60-20,as ATHM also got crushed from 200 to 80. There should be a rebound there,but not 50% retracement.
That said,the US market will hold its own,since it is the strongest in the world,and will only go down significantly after the other ones. I am looking for a peripheral European market to collapse,possibly Turkey. I think Turkey is going to get basted soon,or maybe Russia. Russia should never have rebounded,they are many,many years away from prosperity,possibly after some civil wars. Remember we did not find out footing in Democracy for quite some time,don't expect Russia to.
So when Turkey or Russia,or some other peripheral European economy collapses,possibly due to the free fall of the EURO,watch out. The only thing missing will be the collapse of Germany. The EURO has all the EMU countries locked in cement,they are gonna sink like stones.
Then and only then,will the US fall,and fall very hard and far,possibly down 50% off its highs.
Those are my predictions,I am NostroHiram,take them with a grain of salt,I could be wrong.
Hiram |
