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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Mike M who wrote (68087)	1/31/2001 8:53:42 AM
From: Arik T.G.	Read Replies (1) \| Respond to of 99985

Hello Mike I think the economy is heading towards depression, and Intel is a dead horse. Rate cuts are a good measure against recession but cannot steer the economy away from depression. Very high consumer spending veiled the growing overcapacity problem of the last 4-5 years. Now that consumer confidence is free falling the overcapacity is showing. Lower rates are aimed at boosting the economy through higher corporate cap spending , but when overcapacity is the problem higher cap spending is a joke, no matter the rates. Yes the telecoms, I know, but look at the big picture from Autos to CPUs, supply caught up with the rising demand of the last decade, and kept on. There are now only isolated pockets of unsatisfied demand in the economy (DSPs still have 14 weeks lead time) but those are rare, and generally supply is in abundance. Falling CC is the sign for future lowered consumer spending. The bear market in the NYSE is yet to come. IMO NYA 690-700 and Naz 3000 will be the point from which the real bear market will start. Dot con artists crash was just the preview. Furthermore, current rate cut will benefit mostly old economy companies and the telecoms, so the Naz should be less affected (suppliers to telecom industry the only sector that would really enjoy the windfall). The computer industry including Naz giants INTC MSFT SUNW and ORCL shouldn't get any significant direct or indirect help from current rate cut until the economy itself picks up. For the matter, it seems that IBM will get more from it then the above mentioned. ATG