To: Crimson Ghost who wrote (46328 ) 4/14/2000 8:00:00 PM From: pater tenebrarum Read Replies (2) | Respond to
George, another point of note is that specifically the big cap bubble, which includes stalwarts like GE and WMT, not to mention the big cap tech stocks, remains at a highly inflated level. my opinions on the bubble and its causes and eventual consequences are probably well known by now, but i want to add something pertaining to the role of the technological revolution here. while it is true that on balance technological progress is taking place at an astounding pace, and has brought a great many benefits and will bring even more in the future, the bubble in the credit and asset markets is NOT a natural expression of said benefits. i believe the new era proponents have got this crucial point wrong. the tech revolution only lent the bubble the necessary psychological fuel, the 'idea', the 'concept' around which its inflation centered. but the REASON for the bubble coming into existence is the enormous acceleration in the money supply, as well as the increase in the velocity of money due to the activities of the GSE's and other big credit market players. so the new era proponents will realize with time, as have others before them, that a bubble can deflate while technological progress continues on its merry way.
