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Politics : Idea Of The Day -- Ignore unavailable to you. Want to Upgrade?

To: James Strauss who wrote (38969)	4/15/2001 7:34:26 PM
From: HoodBuilder	Read Replies (2) \| Respond to of 50167

Let me begin by saying I am neither Bull nor Bear but I am a realist. I read with much interest the posts of Ike, you James Strauss and the rest of the valuable contributors to this thread. Although I'd like to believe that a bottom has been put in I have serious doubts. I have, over the past year listened to businessmen and not Wall Street Pundits, Gurus, CNBC Commentators etc...and what I have heard at least from the sector that everyone wants to believe will lead us out of this bear market is as you have just pointed out, that there is NO VISIBILITY! I know conventional investment philosophy tells us to buy when things look their worst, i.e. Joseph's Semiconductor call, but if you could speak with executives in techland you'd hear things like, "there's months if not years of inventory out there", "we are competing with almost new hardware which was abandoned by failed dotcoms and is being sold for pennies on the dollar." Until we can work through the issues above and until tech capex has a reason to be a priority we will not see an upturn from the current earning recession. Old economy business no longer feels the pressure to rush to upgrade their technology due to the dotcom threat...it's dead! The disturbing economic issue that has me concerned centers around the covert action of the Fed. We have seen 3 interest rate cuts that have failed to ignite spending and the Fed is frustrated. They know how bad things really are but are reluctant to tell us for fear of a mass exodus from the market, so what do they do, the same thing they did that got us into this mess. They increase liquidity which translates into a temporary uplifting of the market, like we saw this past week. During the last two weeks in march there was a $100 billion increase in M3. The Fed must be operating on the assumption that if people perceive that prices may increase in the near future they'll be motivated to buy today. This artificial stimulus is very dangerous as we have already discovered. Greenspan knows that the bubble has burst and he's trying to fire "retro rockets" to soften the landing before we slam into earth. The only problem is those rockets have a limited amount of fuel and when it's gone we better have landed as planed or else those actions have actually sent us back into space only to land harder than before. I plan to use every rally to buy more insurance by way of S&P and Dow Puts and when this market really bottoms I'll have powder to buy. When will that be you ask? My Dow target 8000 +/- and S&P 900, oh yes the Comp will be 1350 or lower. The true test in my mind will be when people no longer want to buy technology stocks, Janus is out of business and people are more willing to hear about Sysco than Cisco!