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

To: Earlie who wrote (73584)	1/14/2000 12:20:00 PM
From: Mike M2	Read Replies (1) \| Respond to of 132070

Earlie, thanks for the insightful analysis. My thoughts on the bubble are that it has become so vital to the health of the US economy that those with a vested interest in the bubble will do everything within their power to perpetuate it. This is not to say that it will never end but it does give new meaning to the phrase don't fight the Fed. One benefit of share repurchases is to damper downside action as a result investors are reassured by the lack of downside action and are encouraged to take greater risk and disregard fundamentals. I would suspect company repurchases are made on days when their are few buyers to shore up CONfidence, moreover, if a company announces bad news lace it with heavy buybacks so the stock appears to have "priced in the bad news" or is "looking beyond this quarter" . In addition, Wall St and the mutual fund industry realize that strength in certain darlings and new era stocks are vital to the perception of the new era so it is better to disregard reality and step up to the plate and buy. They realize that the greatest bull market in history will be followed by the greatest bear market in history so why not delay the unpleasantness as long as possible. It is a financial version of the nuclear MAD mutually assured destruction policy between the U.S. and Russia . If the financial industry starts a panic then we are all doomed. In the 20s the US was convinced by BOE's Norman that we should help the european economies by easy money policies in the US now we seem to have convinced the central bankers of the world that they must support the US dollar in spite of of record trade deficits and unprecedented expansion of credit. One final point that Dr. Richebacher makes in his latest letter " through their heavy borrowing and lending of central bank gold , these banks literally organized the bear market in gold" . This is another source of dollar strength Mike ho ho ho