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Technology Stocks : Global Crossing - GX (formerly GBLX) -- Ignore unavailable to you. Want to Upgrade?

To: JPLoos who wrote (2299)	10/4/1999 2:47:00 PM
From: Blackmarlin	Read Replies (1) \| Respond to of 15615

JPLoos, a very good read on the topic of demographic shift cycles is "Boom, Bust, & Echo" (How to profit from the coming demographic shift) by David K. Foot. He also has a sequel which I have not read yet. Cheers, BlackMarlin <<The typical U.S. citizen does the majority of his or her spending between the ages of 49 - 62 years of age. During this point in an individuals life he or she purchases expensive cars, second homes, dream vacations and an assortment of other things. The statistics within the Baby Boomer generation indicates three distinct groups. The first two groups have already joined the ranks of big spenders but the third and largest group is just now joining in the fun.>>

To: JPLoos who wrote (2299)	10/4/1999 6:48:00 PM
From: AurumRabosa	Read Replies (2) \| Respond to of 15615

Even when I include a weasel word like "may?" Your demographic case makes a better argument for why the bull market will last until 2011 when the baby boom bulge retires. I don't see why that will hold down interest rates. My argument goes like this. Bonds are purchased at auction and their price is inversely proportional to the yield. The more buyers that want bonds the higher they bid up the price and hence the lower the yield. I tried to find the stats at the Treasury web site and the Federal Reserve bank web sites. I'm sure it's in that maze somewhere but I didn't find it. Grant's Interest Rate Observer publishes it in their centerfold grantspub.com and if anyone has a subscription handy they probably have the numbers at their finger tips. For years foreigners have purchased more Treasurys that US residents. The US dollar has been strengthening for years as well and that trend seems to have reversed and the yen has appreciated about 20% relative to the dollar in the last couple of months. Several years ago had you been a Japanese resident and earned your salary in yen you would've been better off to convert your yen to dollars and buy US stocks and bonds. While your coin was residing in the US the dollar would've been appreciating relative to your yen, interest rates are much higher and the stock market is booming. But now things are changing and during the last 2 months the stock market has stagnated or dropped for most stocks, interest rates have risen so the price of Treasurys has dropped and the yen has appreciated 20% against the dollar. You're now loosing money and so sell your Treasurys and stocks and convert your sawbacks back into yen and repatriate them back home before you lose too much. Also the Japanese stock market has been going up and you're hopeful the old glory days may return and since the US bull market is getting a bit long in the tooth you want to buy Japanese stocks. A similar case can be made for European countries as well. So, with foreign coin returning to its rightful home who will bid up the price of Treasurys and hence reduce rates? Also, the trend is your friend and rates have been trending up for a year now with the long bond going from just under 5% to just over 6%. William Gross who manages something like $135 billion in PIMCO bond funds says 6.25% is a good buying point for bonds this fall, Michael Metz is calling for 6.75% by xmas, and a Zurich fund manager was quoted in Barron's recently calling for 7% easily this year. Your guess is as good as mine as to which direction rates will go and they can turn on a dime. My money is waiting for over 6.25% before I buy physical bonds and my itchy trigger finger is close to selling T-bond futures to bet on rising rates. As far as GBLX goes I doubt they'll need to sell junk bonds to raise capital at the rate they're going. They just got MSFT and Softbank to essentially pay to build Pacific Crossing. They'll raise about $750 billion when they sell out Atlantic Crossing-1. Paul Allen should invest in GBLX, it'd be better than some of the things he does put his money in, and sometimes jerk it back out.