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To: SJS who wrote (15810)	1/4/2001 11:24:01 AM
From: Tunica Albuginea	Read Replies (1) \| Respond to of 24042

Steve, by the time an economy enters a recession, the market has already discounted that. If hypothetically we have 2 neg Qs of growth the market saw that last spring. So we had our Bear market already. If you wait to buy until we are out of a hypothetical recession, you've missed the boat, TA ================================================== Message #15810 from SJS at Jan 4, 2001 11:16 AM Tunica, You don't define a recession by inflation or unemployment, technically. It's defined by 2 Q's of lower economic growth. The metrics are a little fuzzy for defining a recession, and it depends on which economist you talk to, but that's a generally accepted perspective. What was important was the psychological shift that occured yesterday. OTHER than that, what's changed? Nothing. He did 50 basis points 3 weeks before everyone knew he was going to do 50BP. 3 weeks? How does that change things except psychologically (which was sorely needed, I will add). It was needed 6 months ago, and won't be helping the economy for 4-6 months, AT THE EARLIEST. However, just like the Titanic, you can't steer the ship immediately away from the iceberg. It's too big. Luckily, and unlike the Titanic, we're not going to sink, but we are now taking on some water. The psychogical boost allows you and me to help by feeling confident to now re-invest, and that will tacitly allow us to feel wealthier, and maybe not be so damn tight with our money (ie spend.....). Steve

To: SJS who wrote (15810)	1/4/2001 11:56:20 AM
From: Bill Holtzman	Read Replies (1) \| Respond to of 24042

like the Titanic, you can't steer the ship immediately away from the iceberg. It's too big. Steve, I would normally agree with this logic but I hate to admit that I find myself agreeing with TA that it's different this time. The internet has given everybody access. The pace of modern life is so fast. Everybody is analyzing what's going to happen 6 months down the road. It's like every passenger on the Titanic had their own outboard motor they could throw out and turn that puppy like a sunfish. The fact that the rate cut won't have an impact on the economy immediately isn't important. The investors know it will help out 6 months down the road or so and that's all that matters. In the meanwhile, because we are such a stock frenzied society, the rising market will be self-fulfilling. Rebounding wealth effects will make their way into the economy well before the rate cuts do.