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

To: SecularBull who wrote (72935)	3/20/2001 11:44:40 PM
From: jmootx	Read Replies (1) \| Respond to of 99985

The only 'excesses' were enduced by failure of policy. First, true the Fed was tight in 1929-1930. The final blow to the stock market was in August 1929 when they raised a full basis point. Last Summers rally to just above NASDAQ 4000 happened during a period of tightening, the same percentage rally followed the DOW in the Summer of 1930, and correct that Fed failed to ease. The policy mistakes are the same. The second half of the Clinton administration was mostly worried about short term politics during a period of scandal, and both he and Congress wanted a surplus. In the 1930's too little to late figuring out that we needed Glass-Steagle. Greenspan is an Ian Rahn fanatic, allowed the LTC's to build excesses, even in the face of publicly stated excesses seen in 1996. The failure to curb crises excesses on the way up has happened again. Greenspan understands the value of markets to pull out of crises, but not the reverse in creating them. It has already happened, too late to be the hero, now the only question is there any chance this market can come back before we repeat the thirties---sure hope so. The 1990's saw the unregulated use of options. This was used to inflate earnings so executive pay could increase exponentially. Now that the market reached speculative capacity, these options are deflating stock prices. There should be some reform of reporting them against earnings, but again you got Ian Rahn dictating policy to Congress, hail the king. Remember this famous line at Humphrey Hawkins, Feb. 2000 "Bubbles," states Greenie, "are very difficult to define in the aggregate, and are often not understood until they have passed." Enough said on the failures of this Fed Chairman.