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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Knighty Tin who wrote (63963)	7/3/1999 1:40:00 PM
From: Thomas M.	Read Replies (2) \| Respond to of 132070

Nice guest appearance in Barron's by Randall Forsyth. It is tacked on to the end of Thomas Donlan's editorial column, and when I was reading it, I was wondering why Donlan suddenly sounded so smart. <g> The Meaning of Neutral More rate hikes are coming, as they should "One needn't be a flim-flam man to be a central banker, but it helps." So observed the late Robert M. Bleiberg on many occasions in his long tenure as Barron's editor. And for all the huzzahs bestowed upon Alan Greenspan these days, Bob's observation never seemed more apt. America's central bank last fall engineered three one-quarter-point cuts in its target for the federal funds rate. The global financial markets, in danger of a "significant seizing-up," were lubricated by this liquidity, and asset prices resumed their proper upward trajectory. Greenspan, along with the Treasury Secretary and his assistant, were dubbed by Time magazine the Committee to Save the World. Last week the global markets cheered, at least for a few hours Wednesday afternoon and Thursday morning, after the Federal Open Market Committee reversed one of those quarter-point cuts, as expected, but were pleasantly surprised when the panel declared it had "no predilection" about the near-term course of monetary policy. From which it was universally inferred that no further rate hikes would be necessary. As we did last fall, when the drumbeat for Fed easing was at its loudest, we must dissent from the mainstream. As we argued at the time-and the performance of the U.S. economy has demonstrated since-no easing was necessary then. Greenspan & Co. may well yet come to agree and reverse the entire three-quarter-point reduction. To assume that the FOMC's shift to a neutral policy bias assures there will be no further rate hikes is wishful thinking. Since the Fed began in 1994 to announce policy changes when they happened, each time it increased rates, the panel adopted a neutral bias. That way the markets would not be bracing for the next dose of medicine; they could hope (as they did last week) that it would be the last. Indeed, since 1994, the FOMC has adopted a tightening bias in word only when it wasn't tightening in deed. Meanwhile, the growth of money and credit, which paused in the first quarter after last year's explosion, is now reaccelerating. Gold, to be sure, is moribund, owing to central-bank selling, but industrial commodity prices have rebounded, as evidenced by the Journal of Commerce index and last week's purchasing managers' report. Of course, the popular stock-market indexes hit new highs in the wake of last week's FOMC meeting. But long-term interest rates now are higher than before the Fed began easing last September. And the dollar buys fewer Japanese yen. Flim-flam, indeed. -Randall W. Forsyth

To: Knighty Tin who wrote (63963)	7/3/1999 9:13:00 PM
From: marcher	Read Replies (2) \| Respond to of 132070

Michael, just wanted to tell you that I'm impressed by your comments a few months ago about free computers. That compuserve and aol are moving into this so quickly surprises me. Any ideas about how this will unfold? Who do you think will benefit? --Marc

To: Knighty Tin who wrote (63963)	7/4/1999 11:35:00 AM
From: Freedom Fighter	Read Replies (2) \| Respond to of 132070

Mike, I worked as a hotwalker at Aqueduct when I was 17 years old. I loved horse racing even then and loved the job too. Of course there's not much money in racing unless you become a trainer and are hooked up with a bunch of wealthy owners, so I didn't pursue it. Yesterday I took my father to breakfast at Belmont and we took the backstretch tour. The stress melted away from my body and my nervous system went dead. I made a few bucks in the afternoon too. "God help me but I love the smell of horse shit in the morning". (g) Wayne

To: Knighty Tin who wrote (63963)	7/4/1999 3:06:00 PM
From: Mohammed U. Karkanawi	Read Replies (1) \| Respond to of 132070

Mike, What is your take on BBY now? I got out at $70 but it kept on moving to $73. Less than a month ago it was trading in the low $40s. Following is the chart comparison to Circuit City. techstocks.com. This is the comparison for their fundamental data: finance.yahoo.com There is big difference in their P/E. Why? I believe, one of these two companies should be shorted. Which one would you chose? Thanks in advance for your response. MUK