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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Uncle Frank who wrote (35148)	11/21/2000 1:13:35 PM
From: limtex	Read Replies (2) \| Respond to of 54805

UF - Well the NAZ is a market and indeed it has been referred to this year as The Stock Exchange since it has been the driver of the greater part of the spectacular technology driven growth and productivity growth over the Goldilocks period. No I'm not qualified as an economist. BUt there again Mr G was before the Senate telling them that he wasn't sure himself why productivity was increasing as it did. He said that it was only natural to assume that the rate of growth of productivity could not be sustained for ever. And 'ever' meant what? IMHO when he said ever he meant very soon becuase he was clearly uneasy about allowing the economy to continue because of all the imbalances. We used to hear quite a bit about the wealth effect whilst the NAZ was climibng last year and early this year. Yet today when if there ever was a wealth effect it must surely have been diminshed to a large extent if not turned around into a negative wealth effect, where are the pacifying comments coming from the various 'hawkish' Fed govenors who were so vociferous about interest rates. I happen to think that many of the Fed people have been brought up on good old fashioned economics in that if it looks like the economy is in danger of overheating then put up interest rates and lets see some jobless numbers climbing. Yet it seems to me, in my non-economist uneducated way, that the strong market has itself brought about a lot of these new benefits. The market has financed them nd the fabulous returns and gains fed the growth and aided it. I believe this was true across the spectrum. If you stop that engine in addition to bringing up the numbers of jobless you will indeed slow down the rate of growth of productivity as many of it future generators will have to wait for funding or will wither before getting it. I don't think it is an exaggeration to say that the NAZ has crashed. The S&P maybe not. AS far as being in the black is concerned well OK but there was Dec -Mar. We didn't imagine it. It was there and you give candy to a kid and then take it away........ Best regards, L