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Pastimes : All Clowns Must Be Destroyed -- Ignore unavailable to you. Want to Upgrade?

To: Lucretius who wrote (11786)	2/23/2000 5:38:00 AM
From: Oblomov	Respond to of 42523

Luc, I agree on both points. But, I don't see how the US stock market and economy can implode by themselves in this case. Could Japan or Europe prosper in a world in which the US economy is collapsing? If the buck tanks, who will purchase their goods? We've discussed the possibility of the ECB backing the Euro with gold. I agree that in a time of financial stress, this sort of move could make the Euro a reserve currency. But, currently the Fed is spending its time fighting the inflation risk, while corporate and consumer debt pile ever higher. If the market trends downward over 8-12 months, IMO we will see an increase in the savings rate and a decrease in consumer debt. Personal spending would decline, and so many corporations would be in trouble with regard to their own debt. Whether this means a recession hinges on productivity. And I mean the true labor force productivity, not the imaginary version we see in gov't reports.