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Pastimes : Ask Mohan about the Market -- Ignore unavailable to you. Want to Upgrade?

To: Cynic 2005 who wrote (17824)	9/14/1999 6:43:00 PM
From: Rational	Read Replies (1) \| Respond to of 18056

Mohan, I agree with you now (after two years) that the American miracle (or should I say bubble?) will soon burst. These are my points to support my prediction: * Consumer demand, despite little increase in real wage, is being sustained through (a) a pyramid of debt within the US and internationally, (b) international money infusion into the US, and (c) a deliberate US attempt to create instability in the rest of the world for the capital inflow to continue. Approach (c) is beginning to boomerang. * All IMF/WB/IFC third-world country loans have found their way to the US and Europe; in addition, export profits of those countries have been stashed in US assets, stocks and bonds. The minions of those poor countries (except those with capital control) have been mortgaged for the rest of their lives. The US/Europe/Japan are hoping to extract the money through sanctions or military threats. I believe ordinary Russians will start agitating first; they will do so after no new money is promised by the rich nations. Will US bomb a nuclear Pakistan/Russia to get the money? Once this legitimate agitation builds up in other countries, there will be calls for debt forgiveness, which amounts to demonitization of wealthy countries' currencies to restore equilibrium. * Investors are storing their wealth in yen because Japan is a part of the secure financial system, is under a tacit perpetual military threat and hence will not break the system, and is the country with the most net exports. Other countries are not secure and their currencies/monetary policies are badly managed. * There will be massive bad credits and defaults in the USA to trigger the domino effect. Thus, the money that has found its way from the poor to the rich countries and from less fortunate denizens of the rich countries to the richest individuals will be effectively demonetized; i.e., the obligations will be cut short through the sheer domino effect. * The so-called massive rate of growth in paper profits will simply evaporate. Rational

To: Cynic 2005 who wrote (17824)	9/16/1999 8:10:00 AM
From: Cynic 2005	Respond to of 18056

Tice saw the same point in SOX as I did. From his 9/15 commentary: <<We are in the midst of a most fascinating week in the financial markets, both here and abroad. Stocks continue to trade with considerable indecision and, hence, vulnerability. The more speculative areas of the marketplace trade with extraordinary volatility. For example, the Philadelphia Semiconductor index, or the SOX, traded at about 545 on Thursday, rallied more than 4% on Friday, reversed and traded 4% lower on Monday, then rallied 5% to 575 yesterday and then declined 4% today. Many large-cap technology stocks have had similar moves. We view such action as a likely harbinger of a reversal in this key sector that has been in the midst of an historic speculative run. Most indices have posted declines this week. So far this week, the Dow and S&P500 have declined 2%. The Transports, Utilities, and Morgan Stanley Consumer index have dropped 1%, while the Morgan Stanley Cyclical index has sunk 2%. The small caps continue to perform relatively well, declining only 1% so far this week. The volatile tech indices have losses, with the NASDAQ 100, Morgan Stanley High Tech, and the Semiconductors dropping 3%. The Internets have declined less than 2% and the NASDAQ Telecommunications index has lost 2%. The financial stocks continue to sink. The S&P Bank index has a decline of 4% and the Bloomberg Wall Street index 3%, as the dollar and credit markets continue to look quite vulnerable. >>

To: Cynic 2005 who wrote (17824)	9/17/1999 1:33:00 PM
From: Cynic 2005	Read Replies (2) \| Respond to of 18056

Follow-up: As mentioned in #reply-11269963, an intervention was overdue re. the steep rise in Yen. They did some last night. That brought some bold bulls on to the street today which helped eliminate a few more bears. (Thank goodness I am not yet one of them. -g-) Now that some cleansing is done, (DUNG up 50 and NYSE up 110) we can resume the slide. BTW - I think that 200 point swings will be common for the next 4 weeks. We might even see one today. But definitely we will see one on Monday or tuesday - that will mark the reversal to the downside and a BuBS (Bull Butchering Session) will begin. -g- BWTFDIK?