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Pastimes : The Justa & Lars Honors Bob Brinker Investment Club -- Ignore unavailable to you. Want to Upgrade?

To: Justa Werkenstiff who wrote (7938)	8/20/1999 4:36:00 PM
From: Investor2	Respond to of 15132

RE: "UTEK is flat to up because of the strength in the DD sector. See the Segate chart. But UTEK can be called flat on most any day <g>." PETE's given me an obsession about this issue of divergence. <g> UTEK seems to be a "market performer" recently. quicken.com Not much divergence there. How about this divergence. quicken.com Nice call by Bob. Best wishes, I2

To: Justa Werkenstiff who wrote (7938)	8/21/1999 6:28:00 AM
From: Justa Werkenstiff	Read Replies (1) \| Respond to of 15132

Fed's Guynn warns of less rosy times for US economy By Isabelle Clary NEW YORK, Aug 20 (Reuters) - Comments made by a key U.S. monetary policy maker on Friday fell right into line with private economists' forecasts that the Federal Reserve will raise interest rates next week to rein in economic growth. Federal Reserve Bank of Atlanta President Jack Guynn said the U.S. economy has gone through a spectacular winning streak in recent years but Americans should not conclude the exception has now become the rule. Although Guynn did not directly comment on the likely outcome of the Federal Open Market Committee (FOMC) meeting on Tuesday, he warned the Community Bankers of Georgia gathered in Colorado Springs that today's red-hot economy may be producing ''unrealistic expectations.'' ''For bankers and central bankers alike, perhaps the most daunting legacy of the current period is what I have called the institutionalization of unrealistic expectations,'' said Guynn, whose remarks at the conference were released in New York. ''For central bankers, it's the idea that three consecutive years of nearly 4.0-percent real GDP (Gross Domestic Product) growth is no longer exceptional but merely average,'' Guynn said of U.S. economic growth that has averaged 3.75 percent since early 1996 -- or a full 50-percent more than the pace of economic growth America was once thought to be able to sustain without inflation. Before the Fed's last rate hike on June 30, Guynn already had laid out a prophetic scenario about the reasons justifying tighter credit now for a healthy American economy tomorrow. The Atlanta Fed president's remarks were particularly important for financial markets because Fed officials usually avoid giving a last glimpse into monetary policy right before an FOMC meeting. Wall Street widely expects the FOMC to raise the federal funds rate -- the U.S. short-term benchmark rate for overnight inter-bank loans -- to 5.25 percent from 5.0 percent. A minority of forecasters think another hike may still come before year-end. The financial industry's forecast is largely based on recent remarks by Fed Chairman Alan Greenspan, always wary of inflationary risks, and a stream of economic data -- mainly wage gauges -- that seem to justify such concern. ''For investors, it's the conceit that anything less than 20 percent growth in the Dow Jones Industrial Average is unacceptable,'' Guynn also told the bankers meeting. Although the Fed usually avoids commenting on stock price levels, it has acknowledged that much of the American consumer's spending spree is tied to the record bull run on Wall Street. The Dow Jones posted solid gains on Friday, ending up 136.77 points to 11100.61 -- or less than 1.5 percent shy of its all-time high of 11252.27 set just over a month ago, on July 19. Analysts said it would take more than another mini-rate hike of a quarter percentage point to bring the Dow to its knees and deter the American consumer or investor. ''For bankers, it's the notion there's no such thing as a bad loan,'' Guynn also said, in a reminder that much of America's boom today is heavily mortgaged on tomorrow's economic dream. Guynn is not a voting FOMC member this year but remains a vocal anti-inflation advocate on the 19-member committee that includes eight permanent voters -- seven Fed Board governors and the head of the New York Fed -- and four regional Fed bank presidents who vote on an annual rotating basis.

To: Justa Werkenstiff who wrote (7938)	8/21/1999 6:46:00 AM
From: Justa Werkenstiff	Read Replies (3) \| Respond to of 15132

Forbes Says Fed Doesn't Get It, Opposes Interest Rate Increase Washington, Aug. 20 (Bloomberg) -- U.S. Republican presidential hopeful Steve Forbes says the Federal Reserve shouldn't raise interest rates when it meets next week. ''The Fed should back off the tightening they've been intermittently administering the last 18 months,'' Forbes said in an interview. ''The Fed is still prey to the fallacious notion that prosperity causes inflation. And inflation is not there.'' Forbes is advocating supply-side economic policies in his campaign for president and has been criticizing Federal Reserve Chairman Alan Greenspan. Campaigning in Iowa earlier this month, Forbes said the Fed is partially to blame for the collapse in commodity prices that has ruined parts of the U.S. farm economy. Worse, Forbes says, the Fed is now trying to slow the U.S. economy at a time when deflation is still a greater risk that inflation. ''The Fed is threatening to slow the economy in order to fight inflation,'' he said. ''The fed is fighting the last war. . . . They have not been meeting the needs of the market for increase liquidity.'' U.S. consumer prices rose 0.3 percent in July, mainly because of rising gasoline prices. The core rate excluding energy and food prices rose only 0.2 percent. The CPI is on track to rise to 2.4 percent this year. Meeting Next Week The Fed's policy-making Open Market Committee is widely expected to raise interest rates on overnight loans to banks when it meets next on Aug. 24. After easing rates to boost international liquidity in the wake of the Asian financial crisis, the Fed began tightening again with a quarter point increase on June 30. Forbes points to the plunge in gold prices over the last two years as evidence Fed policy is all wrong. ''It's the purist monetary commodity out there,'' he said. ''You don't eat it. You can't burn it. You can't destroy it.'' Gold has dropped to $258 per ounce from $375 two years ago. ''The danger is that as the fed tightens up, (it) succeeds in slowing the economy,'' Forbes said. ''They clearly don't have a real compass. It's all on the gut of Greenspan and his fellow governors.'' Greenspan's term expires in June 2000 and Forbes said that if it were up to him, Greenspan would probably not be re- appointed. ''I would have a heart-to-heart talk about this wacky notion that prosperity causes inflation. And if he didn't have a change of heart I'd get a new chairman,'' Forbes said. One potential candidate for the job Forbes likes is Empower America founder Jack Kemp. Forbes placed second in a straw poll in Iowa Aug. 14. The Republican party event was a closely watched test of Republican's organizational strength. After five weeks of campaigning in the state and a $1 million television advertising buy, Forbes said his popularity is moving up in Iowa according to private and public polls. ''I quite heartened,'' he said. Nationally, Forbes still lags behind other Republicans. Texas governor George W. Bush continues to lead with 61 percent according to a USA Today/CNN/Gallup Poll taken Monday through Wednesday. Forbes came in fifth among Republicans with 4 percent.