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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Knighty Tin who wrote (70201)	11/7/1999 9:58:00 PM
From: umbro	Read Replies (1) \| Respond to of 132070

Record High Corporate Financing Gap Portends Wider Corporate Bond Yield Spreads ntrs.com The corporate financing gap has traditionally been defined as the amount of funds nonfinancial corporations need to raise in order to finance their capital expenditures, including their inventories. In essence, it approximates corporate capital expenditures minus retained earnings. This financing gap could be filled by the issuance of corporate debt and/or equities. In keeping with the "new era" -- an era in which corporations no longer issue new equities, but retire outstanding equities -- I have expanded the definition of the financing gap to include not only corporate outlays for capital equipment and inventories, but also outlays to retire equities. (I introduced this expanded definition in last week's commentary.) Both in absolute terms and relative to nominal GDP, this expanded corporate financing gap on a four-quarter moving average was at a postwar record high as of the second quarter -- $401 billion or 4.6% of nominal GDP. [...]Obviously, this has negative implications for investors who are "long" corporate credit spreads. But, as discussed last week, this relationship would also seem to have negative implications for investors long the stock market. Unless there is a sharp downward reversal in Treasury yields, corporate borrowing costs in absolute terms are likely to head higher because of the "forecast" widening credit spreads. This implies that corporations are going to find it more expensive to maintain the pace of their equity retirement and/or their capital spending. [...]Of course, there always is the chance that the Lawrence Welk of central banking, Alan Greenspan, will keep the bubble machine going. Maybe, with the cover of the new GDP data, which imply an upward revision to past productivity growth, Greenspan and the Fed's Celtic coalition, McDonough and McTeer, will convince their FOMC brethren to cut interest rates next rather than raise them. I doubt it. I just suggested it so that I could work in the "Lawrence Welk" and "Celtic coalition" remarks. (emphasis added)

To: Knighty Tin who wrote (70201)	11/8/1999 10:12:00 AM
From: Freedom Fighter	Read Replies (1) \| Respond to of 132070

Mike, I think the case against Chilukki is based on the observation that as she stretched out her dominance declined. Her Beyer speed figures also declined steadily and she has a sprint pedigree that reinforces the risk. Each and every year there are a handful of babies with the exact same profile that ultimately prove to be sprinters. More than Ready may be another from this crop on the colt side. A truly dominant 5F-7F juvenile can still be competitive and beat other babies stretching out at this stage. I don't think we can count her out. She ran a fine race Saturday, but there are others that I think are more likely to be true routers for next year. Wayne