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To: portage who wrote (94126)	4/14/2001 1:35:07 PM
From: Lucretius	Respond to of 436258

thanks. look, for this rally to conitnue then there must be a 2nd half recovery due to int rate cuts. this week's earnings and more importantly GUIDANCE will show that theory to be FALSE... the popular theory is that rate cuts will spark a recovery later this yr. we sold off on the 3rd and lst cut, then bounced back to those levels, sold off again and now have returned to them as of Thursday (i'm talking SPX here as well as the other indexes). That in essence is the whole ball of wax, will the Fed's cuts save the day and 6 months from now, we'll be recovering, OR do they not matter? those in the 2nd camp have been selling since the 3rd cut, those in the first have been buying. corp america will speak this week and settle the debate. my data says it will settled DOWN.....

To: portage who wrote (94126)	4/14/2001 1:43:04 PM
From: patron_anejo_por_favor	Read Replies (1) \| Respond to of 436258

Portage...nice point in the comments in that article about counterparty risk in derivatives: We tend to agree with Martin Mayer, who said, "Derivatives markets guarantee a winner for every loser, but they will over time concentrate the losses in vulnerable sectors. Nature obeys Mayer's Third Law, which holds that risk-shifting instruments will tend to shift risks onto those less able to bear them, because them as got want to keep and hedge while them as ainít got want to get and speculate. Very true. The derivative situation is much like a big casino in Vegas laying off gaming losses to a local loan shark...the loan shark collects the primo and looks like he's winning big untill some whale comes in and rakes off 10 Million from the casino in baccarat in one night. Then casino goes to collect the insurance, and.....OOPS! Loan shark's flown to Argentina! It will end badly for sure....