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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: Jeffry K. Smith who wrote (65045)1/28/2000 5:48:00 PM
From: A.L. Reagan  Read Replies (2) | Respond to of 152472
 
Re: Yield Curve. Jon, who watches these things, will tell you that the inverted curve happened fairly recently with the 2's and 5's versus the 30's. Maybe not the 10's.

IMO, increasing S/T with decreasing L/T rates do not, on the whole, hurt techs. Why? (a) most techs don't carry a whole lot of S/T or floating rate debt; (b) most discounted cash flow valuation models use a longer-term T-note rate as the "risk-free" return rate.

If an increase in S/T rates wrings some of the speculative excesses out of the market (by increasing margin costs), that's a good thing.



To: Jeffry K. Smith who wrote (65045)1/28/2000 6:21:00 PM
From: MileHigh  Read Replies (1) | Respond to of 152472
 
It is my understanding that an inverted yield curve signals that rates will NOT be raised LT but will be raised in the ST. That's what the yields say. Meaning, the bond markets are forecasting an actual slowdown in the economy longer term and the FED might actually be lowering rates 9 months or a year from now after they have slowed the economy near term (raised rates)...

MileHigh


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