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Pastimes : ASK Vendit Off Topic Questions -- Ignore unavailable to you. Want to Upgrade?

To: JRI who wrote (19013)	2/20/2001 11:46:55 PM
From: Walkingshadow	Read Replies (1) \| Respond to of 19374

JRI, I realize that AG is a political figure, and hardly above the machinations of same. It's just that the meanderings of the stock market have trivial political impact, compared to the political impact of a long recession and/or sharply increasing inflation, or worst case, runaway inflation. That will make the vast majority of voters of whatever political end of the spectrum one very, very dissatisfied group of people. And very dissatisfied people will never re-elect the incumbent administration---and AG would have to be brain dead to not be acutely aware of that. I maintain that there is no necessary correspondence between market movements and underlying economic fundamentals in the short term and even the medium term, and so short term market movements have little or no real political impact. Just to cite one example, the last 8 months before the November elections saw one of the worst bloodbaths ever in the $COMPX, but yet voters very, very nearly re-elected a Democratic administration. That never happens when there are real economic hard times. The incumbents, whether they had anything to do with or not, are always turned out of office. But during the months prior to the election, there was still only preliminary and suggestive hard evidence that economic storm clouds were on the horizon, and growth remained strong, and inflation remained under control----and voters were consequently not significantly motivated by economic concerns. Furthermore, before we see a real bottom in the $COMPX, there will have to be a major, prolonged selloff in the Dow and NYSE in general. That's because typically money flees the higher risk $COMPX stocks for safer NYSE harbors. When those harbors begin to seem unsafe, they flee to treasuries and cash equivalents to wait out the storm. We have not seen significant evidence of this yet, but I believe we will, though that day may still be some time from now. JMVHO...... Walkingshadow