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Non-Tech : Bill Wexler's Dog Pound -- Ignore unavailable to you. Want to Upgrade?

To: Graeme Smith who wrote (6094)	1/15/2000 5:21:00 AM
From: Graeme Smith	Read Replies (2) \| Respond to of 10293

My two predictions : 1) Interest rates are raised by 3/4 of a point by July. 2) In four years time the next elected government gets voted out of office during the middle of the US's worst recession in living memory. The first prediction sounds bold but is actually a following the herd prediction. The Federal Funds Futures predict at least a 3/4 point rise by July. It always amazes me how accurate the futures are, yet how rarely does anyone ever check them to see where interest rates are going. My second prediction is based on the fact that the Nasdaq has a PE of somewhere approaching 200 (about 170 I think). Obviously this PE will return to historic norms of 20 (or lows of 10) sometime in the next few years. And it is not likely to do so by 10 fold growth in profits. I expect a minimum 70%-80% correction in the index. If this happens the economy will go into a severe recession. When people suffer, such as the millions of would-be millionaire retirees who suddenly find that they're worth enough to buy a good TV set, they will blame someone. No matter whether the government does a good job or a bad job, unhappy people will never vote to keep the same party in power.