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To: Eric Wells who wrote (79683)	10/5/1999 6:59:00 PM
From: Bill Harmond	Read Replies (3) \| Respond to of 164684

Eric, I think the market has gotten past interest rate worries for now.

To: Eric Wells who wrote (79683)	10/5/1999 7:03:00 PM
From: GST	Respond to of 164684

Eric: The fed shapes the yield curve -- I expect it will not get steeper. The risk is that the fed is behind the curve and will have to chase it upwards later. This could happen almost immediately: i.e. on Friday with the employment report. There is also really serious trouble in the gold market IMO (the spectre of defaults and a runaway move upwards -- gold at 339 today in London where the real price is set), and this, combined with dollar weakness, will pressure bond yields -- hence a steeper and steeper curve. A hike today would have flattened the curve a bit. A hike after a delay -- even if it is only two or three days delayed -- will now not flatten the curve as it would have today. The market looked ready to fly -- now it looks more like it might die. This was a very bad day for the market -- and the numbers don't begin to tell the tale. Good luck.