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To: pater tenebrarum who wrote (57742)	1/12/2001 10:20:23 PM
From: ild	Read Replies (2) \| Respond to of 436258

Heinz: Any explanation as to why ALL recent bad news, warnings and downgrades were completely ignored. I have poots on INTC and others. May be I should buy calls? -g-

To: pater tenebrarum who wrote (57742)	1/12/2001 10:31:50 PM
From: timers	Read Replies (2) \| Respond to of 436258

you read this? Message 15172867 the sentiment indicators he's putting forth don't jive with what i see. what you think about all that? lol (rydex don't lie imo)<---good english

To: pater tenebrarum who wrote (57742)	1/12/2001 10:36:48 PM
From: timers	Read Replies (1) \| Respond to of 436258

btw...you see the jump in comm DJ industrial net shorts in the cot? where is the nas info on cot?

To: pater tenebrarum who wrote (57742)	1/13/2001 1:08:44 PM
From: Don Lloyd	Read Replies (2) \| Respond to of 436258

hb - may need subscription (Barron's) - interactive.wsj.com "Economic Idiocy The Golden State struggles with the economy it deserves By Thomas G. Donlan While we observed Governor Gray Davis solving California's energy crisis last week, our thoughts turned to H.L. Mencken, who declared that a politician "is an animal that can sit on a fence while keeping both ears to the ground." He also named democracy as the system that lets the people say what it is they want, and then gives it to them, "good and hard." Four years ago, the California Legislature decided that the people wanted lower electric bills, and that their wish was not impossible to achieve in a state with substantial surpluses of generating capacity and rates much higher than those of surrounding states. So the lawmakers created a mockery of a market in electric power and labeled it deregulation. In practice, it managed supply and demand the way traffic lights manage cars and trucks at the intersection of Hollywood and Vine. Encouraged by consumer advocates, environmentalists and even the utilities' own lobbyists, the lawmakers unanimously imagined that the commands of an Independent System Operator would be so efficient that ratepayers could be guaranteed an immediate 10% reduction in electricity bills. And they thought utilities would make profits guaranteed to retire old debt. Rates were then frozen until 2002. Surprise! Demand grew more rapidly than the legislature expected. On the supply side, meanwhile, California continued to impose restrictions on the operation of fossil fuel plants and let citizen opponents drag out the process of awarding permits for new plants and new transmission lines. The supply of electricity grew more slowly than demand. To make matters much worse, the deregulation law required investor-owned utilities to sell most of their generating plants and deal with the new owners on the state-managed spot market. Last week, Davis got off the fence and declared that deregulation was a "colossal and dangerous failure." Indeed it is, though it is not deregulation. After paying down $17 billion of old debt, colossal losses became the new fate of the state's investor-owned utilities, which have paid $12 billion more for wholesale power than they have been allowed to charge their customers. Coincidentally, the state of California ran a $12 billion surplus in the last fiscal year. But Davis won't make the obvious connection that state government bungling cost innocent private companies $12 billion: Taxpayers ought to bail out the shareholders. Instead, the governor proposed last week that the state step deeper into the market-and make a bigger mess. He blamed the problem on market manipulation and price-gouging, which he proposed to investigate and punish with criminal sanctions. Charges of price-gouging are an infallible sign that the person making the accusation is an economic idiot. Prices are supposed to go up when supplies are scarce, whether the market is for electricity or for taxicab service in a rainstorm. Using the power of the state to hold down electric rates is little better than theft, and will only prolong the problem. Davis compounded this idiocy: He wants the feds to control wholesale prices, spreading the chaos beyond the state line. He also proposed that the state should create an authority that could break through the arduous permitting process and build new power plants on public land. With powers like those, of course, the investor-owned utilities would not be in trouble. Had they been free to build their own generating facilities and free to choose how to balance power purchases between long-term contracts and a spot market, they would have attracted investment from around the world. Texas removed power-plant site regulation in 1999 and scheduled the end of rate regulation for 2002. In a brief time, investors have poured more than $10 billion into the state to fund dozens of new plants that will increase the state's generating capacity by about 20%. The California Legislature will soon convene in Sacramento for a special session to enact new energy laws. But repeal should be the order of the day. If California deregulated its electricity market for real, rates would rise, consumers would conserve, investors would build and the crisis would vanish as quickly as it appeared." Regards, Don

To: pater tenebrarum who wrote (57742)	1/14/2001 10:35:21 AM
From: Box-By-The-Riviera™	Read Replies (1) \| Respond to of 436258

Do managed currency floats lead to a new gold standard?? Saturday January 13 11:24 PM ET Asia, Europe Say World Economy at Risk By Tim Szent-Ivanyi KOBE, Japan (Reuters) - Finance ministers from 25 Asian and European nations warned Sunday that the outlook for the world economy had suddenly darkened because of a slowdown in the United States. In the draft of a statement to be issued after a two-day Asia-Europe Meeting (ASEM) in this western Japanese port city, the ministers vowed to keep taking measures to make their economies more robust and to further reduce their vulnerability to external shocks. The communique, which made no reference to recent exchange rate trends, said long-term growth prospects in Asia and Europe had improved over the past two years, with inflation remaining generally under control. ``However, developments in the recent weeks confirm that downside risks to the outlook have increased, particularly those associated with the continuing economic and financial imbalances in the global economy, and slowing down of the U.S. economy,'' the draft statement said. Ministers were also cautious about the state of the Japanese economy, the world's second-largest, which is struggling to shake off a decade of sub-par growth following the bursting of a bubble in shares, property and other assets at the beginning of the 1990s. The statement noted that Japan's recovery had been only modest and that further deep-seated reforms to the fabric of the financial and corporate sector were needed to put it back on track for self-sustaining growth, which it said was important for the rest of Asia. Officials who have attended the two days of talks have described the tone of the discussion about the world economy as realistic. Despite short-term risks, some ministers have pointed to the recent decline in oil prices as one reason not to be excessively pessimistic. ``They shared the view that ensuring a stable energy market was vital to the maintenance of long-term economic growth for all ASEM members and the world at large,'' the statement said. Review Of Excahnge Rate Regimes The communique was largely given over to a review of the opportunities for economic and financial cooperation between Europe and Asia as well as to the simmering debate over the best exchange rate regime for emerging market economies to follow in an age of fast-moving capital flows. France has backed Japan's call for countries to adopt a managed float of their currencies, which would entail steering their value according to a basket of currencies of their main trading partners. The draft communique concludes that no single arrangement is necessarily right for all countries all the time. It said the key lesson of the currency crisis that ravaged Asia in 1997 and spread to Russia and other emerging economies was that, whatever regime is adopted, governments must follow sound economic policies. ``The experience of recent years suggests that countries now face a much higher risk of financial crisis if they choose an exchange rate regime that is not backed by coherent and appropriate macroeconomic and structural policies, as well as strong institutional arrangements,'' they said. Ministers also approved a replenishment of an ASEM trust fund that was set up to help cushion the blow of the 1997 crisis. Britain's junior finance minister, Melanie Johnson, strongly welcomed the decision but said its purpose should now shift from managing the effects of the crisis. ``This second phase of the Trust Fund should focus on assisting countries to implement the reforms necessary to underpin a sustainable recovery,'' she said.

To: pater tenebrarum who wrote (57742)	1/14/2001 10:38:19 AM
From: Box-By-The-Riviera™	Read Replies (1) \| Respond to of 436258

More on the managed currency float from the same article... dailynews.yahoo.com

To: pater tenebrarum who wrote (57742)	1/15/2001 7:02:08 PM
From: Don Lloyd	Read Replies (2) \| Respond to of 436258

hb - mises.org "...This writer agrees with the reasoning of his Austrian colleagues. But he is at a loss about some of the conclusions they draw from their theories. Kurt Richebacher, for instance, comes to the conclusion that "the stock market crash was the most important, immediate cause" of the Great Depression. Surely, we readily agree that the crash generated a "poverty effect" which depressed consumption and promoted savings. But that's no cause of depression. On the contrary, while the consumers' goods industries may feel a pain of readjustment and the producers' goods industries may stagnate for a few months, the new savings tend to reduce interest rates, which may hasten the needed readjustment. The rapid recovery from the post-World War I decline (July 1920-July 1921) clearly demonstrates the point. Surely, all readjustments are painful and take time; they entail business losses, capital writeoffs and temporary layoffs. They may lead to short recessions, but are incapable of enmeshing a market economy in a long and deep depression. Only government intervention can turn a market readjustment into a Great Depression. President Herbert Hoover and the Republican Congress managed to do just this when they enacted the Hawley-Smoot Tariff Act of June 1930 which raised American tariffs to unprecedented levels. It practically closed U.S. borders and caused the immediate collapse of the most important export industry, American agriculture. In the depression that followed, the U.S. Congress struck another blow which shattered all hope of recovery. The Revenue Act of 1932 doubled the income tax, raised estate taxes, and imposed several new taxes. When state and local governments faced shrinking tax collections they, too, joined the federal government in imposing new levies. In 1933, in Hoover's footsteps, President Roosevelt placed the government in the driver's seat. The National Industrial Recovery Act led to the development of codes of prices, wages, hours, and working conditions. It pursued the old daydream of prosperity through less work and higher pay. And finally, we must not overlook the Wagner Act of 1935 which took labor out of the courts of law and raised the costs of labor, which again deepened and lengthened the Great Depression. Only when more than 10 million able-bodied men had been drafted into the armed services in World War II, unemployment ceased to be an economic problem. And only when the purchasing power of the dollar had been cut in half through vast budget deficits and currency depreciation, did American business manage to adjust to the oppressive costs of the Hoover-Roosevelt Deals. It is unlikely that the George W. Bush Administration will repeat the fateful blunders of the Hoover and Roosevelt Administrations. We know of no plans for closing American borders, for doubling the income tax, codifying business activity, or significantly boosting the costs of labor. Guided by Keynesian and Monetarist thought, both major parties undoubtedly will want to inflate more, create credit at faster rates and, above all, increase government spending. But contrary to Keynesian and Monetarist doctrine, such measures may actually hamper the business recovery. Massive budget deficits and near-zero interest rates may actually impede economic activity, as the Japanese recession throughout the 1990s so clearly demonstrates. Or they may precipitate an international run from the U.S. dollar, which would rekindle the price inflation of the 1970s and 1980s. Blinded and dulled by Keynesian and Monetarist thought, the politicians in power probably will act as they always have acted: they will spend and spend and make matters worse. ..." Regards, Don