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To: Paul Merriwether who wrote (70482)	7/29/1999 7:09:00 AM
From: KeepItSimple	Read Replies (1) \| Respond to of 164684

> this here is no bubble economy It's late, so I'll forgive you for nonsense. Please read the following and get back to me. Former Fed Chairman Paul Volcker recently summed up the situation quite succinctly when he said, "The fate of the world economy is now totally dependent on the stock market, whose growth is dependent on about 50 stocks, half of which have never reported any earnings." Only the GDP of the entire world at $25 trillion overshadows the $13.5 trillion capitalization of the U. S. stock market. At 150 percent of our huge $8.8 trillion GDP, the ratio of market capitalization to GDP is nearly twice as high as it was in 1929, the previous all-time high. We are light years from the 70-year average of 50 percent and from the low of 33 percent seen in 1974 and 1982. In the last two years, the stock market capitalization has increased over $5 trillion dollars, a gain equal to 60 percent of America's current GDP. Unfortunately, earnings of the underlying companies have not been responsible for this surge. Since the end of 1996 the S&P 500 has rallied 77 percent, but S&P earnings have grown only about 2 percent.