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

To: Mike M2 who wrote (70749)	11/20/1999 11:13:00 AM
From: Freedom Fighter	Read Replies (3) \| Respond to of 132070

Mike, I think there are a lot very positive fundamentals about U.S. business. We have the finest collection of cutting edge businesses in the world. I also don't totally reject some of the bullish ideas about R&D and software assets, related earnings understatement etc... It's the valuations that are being placed on these businesses that is highly suspect. As you know, I find it incredibly irresponsible for brokers, strategists, and the financial media to be so aggressive in promoting stocks at these valuations. Especially when they use spin that borders on outright lies to do so. For every bullish argument, there's a long list of hard to refute rebuttals about poor earnings quality, corporate spin, excess credit, historic valuations, historic economic relationships, clear signs of non-fundamentally based speculation, potential future returns vs. expectations etc... The public deserves an education about these things too. I love Warren for taking that role. I think AG.com has been very balanced in his own words. I have no real criticism there. He's covered both sides of the debate reasonably well. However, he has been incredibly one sided in his actions. His rein as Federal Reserve chief is one based on increasing liquidity at every sign of trouble. It started with the 87 crash and early 90s banking bailout and culminated with the LTCM, Wall St. bailout of 1998. Not everyone buys the monetary and credit view of the world that we have. They don't see the relationship between flooding the system with credit and money and producing higher stock prices and credit related earnings streams. BUT, and this is the reason I am always so critical of him, AG.com does. All you have to do is read his writings of the past and some very recent comments about his current thoughts made by former associates. That he has fed what we believe is a bubble (and importantly he does too) makes him open to the verbal hostility that you see from people from time to time. Hiding behind his responsibility of stable "consumer" prices is no excuse. He also has a responsibility for sustainable economic growth. Surely, he understands the role that excess credit plays in the boom/bust cycle. He must also see the signs of rampant speculation that fly in the face of some theoretical justification for ever higher stock prices that some popular bullish strategist on Wall St. can come up with. (you know who I'm talking about (bg) So IMHO not only do his actions open him up to criticism, they open him up to suspicion. Politics or not, at a minimum, he is putting an entire generation of middle class investors at "risk" of very substantial loss in order to prevent losses by the privileged on Wall St. Had he allowed some of the excesses to be removed from the system early on, we wouldn't have the speculative attitudes and greater financial excesses we have right now. We also wouldn't have an entire generation of very bright but ill-informed middle class investors with their fortunes tied to a once in a century aberration. It's scary and sad and provokes a lot of emotion on my part. Wayne

To: Mike M2 who wrote (70749)	2/22/2000 2:47:00 PM
From: Thomas M.	Respond to of 132070

Thanks to all (including Magner, Nadine Caroll, Andrew Aiken) for the recommendation of Devil Take the Hindmost - I enjoyed it tremendously. It contains several great Buffett quotes, my favorite being this one: <<< Warren Buffett's phenomenal investment returns over nearly half a century have perplexed the efficient marketers. They argue that Buffett is an anomaly, a "three sigma event", so statistically abnormal as to be discounted from their theories. To this Buffett replied that he should endow a university chair to teach the Efficient Market Hypothesis: "What could be more advantageous in an intellectual contest - whether it be bridge, chess or stock selection - than to have opponents who have been taught that thinking is a waste of energy." (Berkshire Hathaway, Annual Report, 1985.) >>> Tom