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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: William H Huebl who wrote (43367)	9/7/1999 6:57:00 AM
From: Skeet Shipman	Read Replies (1) \| Respond to of 94695

Bill, My indicators for the overall market only moved up slightly Friday. Money is looking for a place to go. Since bond investors are more risk averse than stock traders, some money decided to go with the seasonally strong techs. Expect money to look for liquidity this week. The week could be volatile or just dull depending on what the Fed speakers say. My recession comment from last week meant conditions are forming which would increase the likelyhood of a recession. It was not yet a prediction or a weatherman's watch or alert. If future reported data indicate the situation is further developing I'll notify you. For now I'll just say it is not depend on a market bubble bursting. Though, that would certainly accelerate the process and cause one. ALL PERIODS OF PROSPERITY SUBSIDE (END) "Subside" better reflects what a slowdown mild recession would mean for the US with its effective monetary control and favorable demographics than using the word END. What has been occuring is that the extreem senarios are increasing in probability. This is not good. It seems best for the Fed to complete draining of excess liquity until the consquences of a sudden shift in business investment and consumer spending would be less likely and less dire. Any increased spending stimulation by the Fed, fiscal policy or a rapid rise stock market would only worsten the situation. SLOWING ECONOMY MEANS REDUCED EARNINGS AND VICE VERSA It is interesting how differently the stock market reacted to ecentually the same information this Thursday and Friday. Sear's reduced earnings expectations due to slowing demand for durable goods, compared with the release of lower than expected job growth caused opposit reactions by the market. Bad may be good; however, it is still bad for earnings. WE MAY REPLAY 1990 There is a good probably the leading indicators are not going to fortell the slowdown and possible recession because spending patterns may suddenly reverse from period of excess liquitity and high consumer debt as in the 1989 - 1991 period. Skeet