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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Shoibal Datta who wrote (43851)	3/15/2001 10:21:03 PM
From: 16yearcycle	Read Replies (3) \| Respond to of 70976

I hope you understand that I feel that nothing has truly gone wrong here. We had overvaluations which were corrected last April when the nas dropped 2000 points in days. But we went back up again so we corrected again in the fall. So far so good. Since fall, though, it has been the perfect storm. No doubt about it. 1. The future growth of telecom, the communications infrastructure build, was based on liquid bond and equity markets, which were being strangled by strong dollar and tight monetary policies of the fed reserve. 2.Demand for the services was slowing anyway. 3.Large caps were monetizing their own infrastructure outlays over the past two years. 4.Consumer spending for equipment is slowing also, and now pinched badly by falling equity prices. We now have a situation with overcapacity, and demand that is falling, and may get worse, due to the corporate profit and consumer spending squeeze that is hitting. And now we are infecting Europe and Asia. Solutions? Time and a non-tight monetary supply. In time, we are going to see no inflation, great year over year e comparisions, falling energy prices and lower interest rates. It could be one year, easily. We could start to react to this possibility at least 6 months ahead of time. But we are going nowhere fast with deflation staring us in the face and a tight policy. Greenie thinks that he needs to barely ease because it is an inventory correction, and he is making a catastrophic mistake, imho. I can hardly imagine that we are at real interest rates approaching 5% while on the cusp of recession!!It is unbelievable.