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

To: Zeev Hed who wrote (69490)	2/18/2001 3:20:37 PM
From: Crimson Ghost	Respond to of 99985

Zeev: Agree on US rate cuts. But EU is starting to hint about a rate cut there in the near future.

To: Zeev Hed who wrote (69490)	2/18/2001 3:55:12 PM
From: Ibexx	Read Replies (2) \| Respond to of 99985

Zeev, Re. ? The market are not far (the Dow actually is higher) from their levels when AG coined the famous "irrational exuberance" sound byte, Since you were make a comparison of "then" and "now", may I ask what was the S&P valuation when the famous phrase of irrational exuberance" was uttered? And what is it now? Thanks in advance for your comments. Ibexx

To: Zeev Hed who wrote (69490)	2/18/2001 6:03:20 PM
From: ajtj99	Respond to of 99985

Zeev, I agree that there will be no additional rate cut by AG before the 21st. As for the high PPI figure, I believe it was a combination of things, including latent energy price increases being passed along. When fuel prices spiked this summer, freight companies immediately passed along the costs in the form of "emergency fuel surcharges." Unfortunately, companies that produce and sell goods and services do not always have that kind of market acceptance or cartel to facilitate passing along those increases. Most wholesalers and retailers are conditioned to accept price increases once a year in January, and possibly in July if conditions warrant it. I believe the high PPI was a one-time blip that will be confirmed when we see the CPI behave as expected. The blip should give the markets some fuel to price in a 50-basis point cut in the end of March, which AG will crush when he goes only 25-bp, IMO. Zeev, I'm also curious how you see this scenario playing out with the S&P500. I think we are going to have a slew of earnings warnings in March and April, and forward guidance will be lowered for the 3rd quarter by many companies. If we get negative growth for the 1st quarter, it may take until June or July to see bottom in the S & P.

To: Zeev Hed who wrote (69490)	2/19/2001 12:56:11 AM
From: Berney	Read Replies (5) \| Respond to of 99985

Zeev, I can only tell you that I'm on the front lines. Accountants prepare their estimates to clients based on the previous year and 1/15 was the last due date for these estimated payments. Further, clients blindly follow these "suggested" estimated payments without regard to their current situation. My preliminary analysis says that the surplus is going to evaporate. The clients did not see the capital income in 2000 that they saw in 1999, and, further, the "refund" is going to offset any estimated payments for 2001. If my preliminary analysis is correct, the budget surplus is going to vanish in April. We will see! Berney