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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Madharry who wrote (48897)	5/2/2000 9:10:00 AM
From: marginmike	Read Replies (2) \| Respond to of 99985

Please wake up and smell the coffee"Rate hikes mean little for those that don't borrow such as the techs and biotechs." That is the most ridiculous thing I have heard. Though Tech companies are imunne to small gains in rates, if rates went to 7-8% there would be a blood bath in tech and the overall market. How do people lease computers? or business's finance infrastructure buildout? Or if nobody is buying new homes who will need new infrastructure? How much more will AMAZON loose if consumer spending declined substatially because they had to scrape up more money to pay their mortgages? Get real, INTEREST RATES DO MATTER TO TECH!

To: Madharry who wrote (48897)	5/2/2000 9:47:00 AM
From: pater tenebrarum	Respond to of 99985

Armin, <<The market is not just GE CISCO MSFT >>. that's debatable. while there are certainly a lot of stocks out there, the 'market' in the form of the indices is indeed driven primarily by the performance of a handful of big cap stocks. the majority of stocks has been in a bear market since April '98 (the peak of the a/d line). <<The fed has totally blown it >> that's something we can agree on. the Fed has allowed the biggest expansion in the money supply in history over the past decade, thus fostering the bubble in the stock market. btw, i also agree with you that it is quite possible that much higher rates are needed to entice people into abandoning stocks for fixed income instruments. the public as recorded by the Rydex ratios and the AAII sentiment poll is after all still intensely bullish, more so than at any other point in the history of these indicators. of course it's eminently logical to be more bullish on the S&P and Nasdaq when they sport p/e's of 30 and 200 respectively than when they sport p/e's of 7 and 15 (1982). at that time the public was as bearish on stocks as it is bullish now. regards, hb a dour bear...:)