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To: quasar_1 who wrote (15332)	10/20/2000 10:24:18 PM
From: Jim McMannis	Read Replies (2) \| Respond to of 275872

Quasar, After reading your latest replies I can only find a couple of small points that we disagree on. Which is amazing itself since at first it sounded like we disagreed on everything. We agree on practically everything. RE:"The markets do this all the time. Where was the recession after the '87 crash?" I think we basically had a 1 day or one month bear market depending on where you want to start from. No enough to cause a recession or there were other factors. RE:"How about the '98 sell off? The market has predicted 10 out of the last 5 recessions". Wasn't this the Asia related recession? It hit them a lot harder. Maybe slowed us a little. A tax cut helped us cushion it. The key is that the markets "attempt" to anticipate. Like you said often it doesn't pan out. Emotion can shift from "all is right" to "all is going to h$ll in a handbasket" in a flash. They throw out everything and it's irrational and not a lot of fun. When markets get over extended...the rubberband is often overly right for a snap back. RE:"If you want to try to predict a recession you have a much better chance looking at money supply or credit expansion/loan demand. Even then it is a crap shoot." Actually if you look at the expansion of the money supply over the last 10 years we should have had more than a couple boom bust cycles. RE:"Markets aren't predictive, they are reactive." That's really a play on semantics. I can show you some intermarket analysis that strongly suggests some markets are predictive of others. Actually I ave a model that does this. I think what you are saying though is that Wall Street simply reacts. Knowing just what they will react to, definitely helps in that instance. Whether or not that predicts something is another story. Jim