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To: mishedlo who wrote (12955)	4/23/2001 10:21:58 PM
From: pbull	Respond to of 13572

M: My premise about 2002 is based on cap-ex, not consumer, spending. The mortgage refis have already occured for this cycle, I believe. Another point: I happen to agree with your outlook for the second half of 2002. But stocks often rise as the Fed tightens (because earnings expectations are improving), just as stocks can fall when the Fed eases (as we saw in Q1 this year, as business prospects dim.) The Fed is just one piece of the big puzzle. As banks feel more comfortable with the outlook (which hasn't happened YET), they'll resume lending and business confidence will rise. Personally, I would be willing to bet on that, just not yet. PB

To: mishedlo who wrote (12955)	4/23/2001 11:12:49 PM
From: pbull	Read Replies (1) \| Respond to of 13572

Addendum: After rereading your post for a third time: Again, I really believe we're all singing out of the same book here. As it stands now, financial stocks are not going to lead the next cycle, as they did in 1990-91, in part because the stocks are not depressed now (C traded at 8 in 1990), long-term rates already have bottomed (imo), and I think the real estate market, in general, is overbuilt, and SoCal soon will be dealing with military base closings again (as it did in the late '80s. For those who don't remember what that was like, it wasn't a pretty sight watching tens of thousands of Californians leave, like "Grapes of Wrath" in reverse). In tech, we're going to see more prominent names disappear, or at least, be relegated to an asterisk in history. It's natural. It happens. It's part of a normal cycle. And it is painful, as the year-to-date layoff totals suggest. But the beginning of the end, to me at least, is in sight. Why? Because in the U.S., unlike Japan, noncompetitive companies usually are removed quickly; they usually aren't allowed to be comatose for years on end. And here's where Bo's comment comes in: The Naz has been dropping for 14 months, how long do you think the pain will last? Now, don't get me wrong: what happened over the last two weeks was a Fed-engineered bear-market rally. We're going back down, because the fundamentals do not YET support such a rally. So, if your thing is to find great shorts, M, there are a lot of great shorts out there. Companies in weak competitive positions with deteriorating balance sheets. Lots of 'em. Dozens and dozens. Take advantage of that now, because as the fundamental outlook turns, perhaps as soon as June (according to a businessman in Tulsa), it will be easier for second- and third-tier companies to obtain the financing they need to grow again. All of the above, imo. Take care. PB