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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: Mark Bartlett who wrote (43264)	10/18/1999 9:22:00 AM
From: Hawkmoon	Read Replies (1) \| Respond to of 116764

Time will tell if this is sophistication, or being brainwashed by the financial industry. I would argue that putting money into 25-50 stocks that support the entire market, while the rest of it is clearly in a bear, may not be sophistication at all. In fact it may be blind faith. All good points. However, most people buy index funds and for the life of my, I've never understood why those proceeds only get spent on the upper 50 S&P stocks, and more definitely, the "Four Horsemen". But what it signifies is that the broader market will now commence to move forward at pricing power returns. It is the one thing that AG doesn't seem to take into account, that we must have a certain amount of inflation in order that corporations having pricing power, at least in the 2-3% range. Inflation below that and they have difficulty making earnings. You'll have to wait and see how money outflows from the mutual funds over the next months, if not years. And remember that 401K and IRA money, once committed to retirement accounts, is strictly committed to investment purposes (to avoid early withdrawal penalties). That means when it leaves a mutual fund, the money goes into bonds or money market funds. And when money is effectively removed from the consumer economy, which IRA money is, that qualifies as savings whether others are willing to perceive it as that or not. Btw, this comment on American free cash flow confuses me: This is globally dependent. Unless other global economies can participate in this process, I can not see it lasting until DOW 20-30K. Just look at the past two years Mark. Asia and Europe have essentially been in severe recession, or close to it. It really didn't impact us greatly at the consumer level. Their weakness is our strength when it comes to prices on imports. Their economic strength is also our strength when it comes to markets for our goods. Inflation may go up, but they will be able to buy our stuff, something they have not been able to do for the past two years. Regards, Ron