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Pastimes : The Justa and Lars Honors Bob Brinker Investment Club Thread -- Ignore unavailable to you. Want to Upgrade?

To: Dave-in-MarinCa who wrote (378)	7/20/2000 10:04:32 AM
From: Justa Werkenstiff	Read Replies (2) \| Respond to of 10065

Dave: Re: "Moto holds Kasrial in high esteem as do I, for his expertise and candor, both refreshing in this world of spin and spam. In this article, Kasrial says," Although many market analysts have erased an August 22 FOMC rate hike from their calendars, we still have it penciled in" agreeing with Bob Brinker's observation." Good article with solid analysis. An August increase is a 50-50 event in my mind at this point. It changes every day with the data. Remember how quickly the expectations changed at the end of May from 50 basis points to nada for June's meeting? Things can go the other direction in an equally quick manner. Re: ".... the FOMC is likely to discount the second quarter economic moderation as a weather-induced head fake and the July pickup as the true colors of the economy." The hawks will. That much is for sure. Re: " Also, Dismal continues to highlight the risks of inflationary forces moving forward." I have commented on the inflationary expectations of rising oil prices before if they stick. I take a broader view. I am looking at energy prices in general. I see this as a big risk. The other risk now seems to be a potential loss of gridlock. This has not been discussed much but it will in the coming months be a topic of conversation. Gridlock meant good things for investors. There is the risk we could lose it. Re: "I think Bob's continuing analysis of real M2 growth is correct not because of the absolute numbers, but because real inflation is substantially higher than the BLS numbers (look at real estate, energy and food not to mention health care) effectively reducing real M2 growth to the negative and the corresponding negative effect on the equity markets. The market is at risk to this reality." You slow down the growth of M-2 and you pressure the stock market. Makes sense to me. One thing of interest in the first article from Northern Trust was that the idea that multiples will not expand because interest rates will not come down given a soft landing.