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Strategies & Market Trends : Steve's Channelling Thread -- Ignore unavailable to you. Want to Upgrade?

To: Logain Ablar who wrote (11389)	2/20/2001 5:58:48 PM
From: Zeev Hed	Read Replies (1) \| Respond to of 30051

Tim, I agree, it is really a question of consumer confidence, A simple rapid fire tax cut that will distribute the yearly projected cut of $160 Billion in the form of $1000 to each tax payer as a direct tax credit (reenacted each year and adjusted, hopefully only up, according to most recent surplus projections) would do wonder to increase consumer confidence and reliquify the consumer. Changing the rates, IMHO, will not have the same psychological impact, nor, IMHO, will it trickle as much to become consumer buying power. Early last year, when every one was talking about the surplus, I warned that historically, surpluses, particularly if they exceed 1% to 2% of GDP are sure to bring on a recession, if consumer confidence does not change, this present inventory adjustment will rapidly turn into a recession. That is one reason that my turnips are not willing, yet, to deliver a more detailed scenario post the late April/early May peak they expect. They are already starting to see problems coming in after the 4th of July (a local bottom around July 28 to August 4th, will need to refine), but that depends a lot on the tax cut, consumer confidence and whether AG cuts .5% or .25% (I prefer the latter, if he goes another .5% he looses the ability to keep the bias positive later on and shorten the recovery). Zeev Zeev

To: Logain Ablar who wrote (11389)	2/20/2001 7:51:25 PM
From: Jdaasoc	Read Replies (1) \| Respond to of 30051

Tim: the significant increase in taxable wages due to option exercising. I have accountant friend that has several clients who are MSFT employees that incurred large tax burdens based upon exercise of LT stock options with large capital gains. Some tax laws changes during the Clinton era required the exercise of some options originally scheduled to be exercised in 2001 to be now exercised in 2000 adding to the amount of tech stock exercised in 2000. As the value of the asset, MSFT stock, to pay the tax liability decreases, it has been sell, sell, sell to pay the tax bill for these employees. There is sudden realization that the salary over the last 6 years of a MSFT employee is a lot less than they expected even 6 months ago.. RE Layoffs it appears to be a the "last hired, first fired" situation right now. I don't see the doom and gloom sernario yet. However, I am sure getting increased number of sales calls from salesmen trying to meet their quotas. My impression is despite their valiant efforts they will fall short of quotas due to a stalled economy and be layed off soon and seek new jobs where ever they can. john