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

To: BGR who wrote (73990)	1/18/2000 11:51:00 PM
From: Skeeter Bug	Respond to of 132070

bgr, you win the GRAND prize! you used elucidate twice in the same post! u da ant! ;-)

To: BGR who wrote (73990)	1/19/2000 12:23:00 AM
From: Broken_Clock	Read Replies (1) \| Respond to of 132070

re: <<As for the "stock market bubble, frenzied money supply expansion, manic borrowing, and bogus economic numbers" - since these are subjective impressions, they do not deserve any criticism, IMHO.>> "There is one cause, and only one cause, of all panics and depressions in the economic world. That cause is debt. Credit is debt. If you can imagine a commonwealth in which nobody owed anybody else, and where the commonwealth owed no exterior commonwealth, it would follow that, though there would be lean times and fat times?and although the individual would fare better under some conditions than others; yet if no credit had been extended, which is the same as saying no debt had been contracted, there would be nothing to cause a panic or bring a monetary or exchange depression. It is the fear of capital for its safety that precipitates a panic, and it is the attendant rush to cancel debt that brings about the ensuing depression."

To: BGR who wrote (73990)	1/19/2000 8:55:00 AM
From: Earlie	Read Replies (2) \| Respond to of 132070

BGR: Much better. Fewer red herrings this time. Now let me see if I am following your arguments accurately. 1. - Most folks, including foreign investors are trend followers. 2.- Since bond prices are falling and stock prices are rising, and the U.S. dollar is steady, this means that those foreign investors are selling their U.S. bonds to buy U.S. equities. The bond selling has no relationship to the credit worthiness of the U.S. 3.- Articles suggest that the U.S. has a budget surplus and is contemplating paying off its deficit over the next 15 years. 4.- Based on the above, and the fact that Japan is inflating and that the Euro shouldn't be considered, the U.S. buck is safe. 5. My observations that (a) the market is a bubble, (b) the U.S. money supply has (and continues to) expanded at an historic rate, (c) both consumer and corporate borrowing is quite literally "off the graph" and (d) much of what is reported by the U.S. government as economic statistics is bogus,... all of this is just "subjective impression" 1. Nice to see that we can agree on something. Most investors are indeed trend followers these days. 2. Might it be that those foreign investors who are selling their U.S. treasuries are perhaps buying their own stocks (most foreign markets are up dramatically), or their own bonds (especially in Japan), etc.? U.S. stock prices up? Not the majority of them. Check out the percentage of U.S. stocks that are well down from their April 1998 highs or the percentage of them that are below their 200 day moving average. The fact is that most U.S. stocks are not moving up. The cap weighted indexes are held aloft by a few dozen heavily cap weighted stocks. I note that the U.S. has been put on "credit watch" by one of the two big U.S. (not a typo,.... U.S.) credit rating organizations. Foreigners wouldn't notice this?,.... or worry about being repaid? 3. About that U.S. "budget surplus". I know you are intelligent enough to recognize that this is nonsense. The total U.S. government deficit continues to GROW, and if it were not for the chicanery of government "borrowing" from the social security pot, the airport improvement fund, etc., one might have a clearer picture. Check out U.S. government tax receipts (which I do). They provide some interesting observations about this "surplus". Corporate tax receipts have NOT accelerated at all (first time in recent history that reported profits have diverged in trend from corporate tax receipts,....does this say something about the accuracy of reported profits?). Ditto individual income tax receipts. The big windfall is pure and simple capital gains tax receipts. I wonder what will happen to that "surplus" when the stock market balloon pops? Do the math if you lend any credence to that ridiculous idea that the deficit might be paid off in 15 years. To do so would require something in excess of 25% of total government annual expenditures,...even if receipts held up. The idea is too silly to waste time on, particularly given the perfect multi-decade track record for growing the deficit. 4. Again, a small area of agreement. Japan is on the ropes and will remain there (or even be pushed out of the ring) for the foreseeable. The Euro a write-off? Based on what? Sure it fell after its introduction, but it was a brand new currency that many in the U.S. expected to fold within a few weeks. It was over-priced at intro to boot (very profitable for certain banks). It sure doesn't look weak to me. I also note that you have not mentioned the real currency, gold. I note that in spite of concerted central bank efforts to keep a lid on gold prices, it is well off its lows. Rather promising, given the circumstances. 5. "Subjective impressions"? Hmmm. I think that you will find that they are just a tad more than that. Apparently, I'm not the only observer who thinks the U.S. market is a bubble. Volker, "Mr. Yen", The Economist, etc. If you would bother to access the stats, you would find that U.S. money supply, borrowing and stock market appreciation are in parabolic growth. That is not an "impression", it is a fact. As for U.S. government "bogus numbers" being an "impression", I'll let the "chained dollar" U.S. GDP numbers, the U.S. "no inflation" CPI ("after backing out energy and food",...what a joke) numbers, the Labour dept employment numbers (including their infamous 75,000 "small business contribution per quarter") numbers , etc., act as my defense for coming up with such a wild "impression". (g) Best, Earlie