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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: Jim Willie CB who wrote (36341)	4/26/2001 4:06:59 PM
From: stockman_scott	Respond to of 65232

Cisco leads the list of shorted stocks... zdii.com Best Regards, Scott

To: Jim Willie CB who wrote (36341)	4/26/2001 6:23:46 PM
From: stockman_scott	Respond to of 65232

Fed Less Optimistic About Quick Rebound Thursday April 26, 6:06 pm Eastern Time By Marjorie Olster <<SANTA BARBARA, Calif. (Reuters) - Federal Reserve officials sounded less optimistic on Thursday about the chances for a U.S. economic recovery early in the second half of the year, saying that rebound might now be delayed. In an onslaught of Fedspeak, two Fed board governors and three regional bank presidents appearing at several different events around the country offered current views on the economy following their surprise interest rate cut last week. The speeches left a clear impression that the Fed stands ready to lower rates further in the near future if economic weakness persists. Hopes for further rate cuts boosted stock prices moderately. A few months ago, when the Fed began to lower rates in the face of a sharp deceleration in growth, central bankers had sounded confident the economy would spring back in the second half of the year. But they now seem to be changing their tune. ``For the nation, I am expecting a faster growth rate by the end of the year. The turnaround probably has been delayed somewhat,'' Federal Reserve Bank of San Francisco President Robert Parry told reporters after a speech in Santa Barbara. ``I think that the recovery is going to be perhaps in the initial stages somewhat more moderate,'' he added. Philadelphia Fed President Anthony Santomero, speaking to financial analysts in Philadelphia, said he expects ''unacceptably slow'' growth through the first half of 2001 with a rebound likely in the second half of the year. But growth would reach more acceptable levels only in 2002, he added. Both businesses and consumers have cut back heavily on spending recently, confidence has fallen and layoffs are mounting. Meanwhile, the manufacturing sector is contracting, the stock market has dropped sharply, energy prices are rising and California is mired in a severe power crisis. Explaining the Fed's shock rate cut last week, Parry said recent data had confirmed the economy was experiencing a significant slowdown and the Fed thought lower rates would boost spending and confidence. RATE CUTS LIKELY The Fed has lowered interest rates aggressively since the beginning of the year to try to get the benchmark overnight bank lending rate down to a level that is commensurate with an economy that has slowed to a near standstill. Last week's half-point cut in key rates was the fourth in four months and brought the federal funds rate to 4.5 percent. Using language that Fed watchers usually interpret as a signal of further rate cuts, Parry said the Fed would continue to be ``especially alert'' in monitoring the economy. Santomero read from the same script: ``Should further unexpected weakness in spending materialize, the Fed has the latitude to again respond quickly and effectively -- just as I believe we have in the past four months,'' he said. Wall Street is anticipating another reduction on May 15 when the policy-setting Federal Open Market Committee meets. Parry said he does not expect the economy to fall into a recession and estimated the current growth rate to be a small positive. He predicted a more ``respectable'' pace by year-end but added the economy would not likely return to its full potential this year. ``No doubt, the road now and immediately ahead may be rocky, given the fact that there are some downside risks,'' Parry told regional business and political leaders. RISKS ABOUND Further declines in stocks or confidence could exacerbate the slowdown in spending and investment, officials said. Kansas City Fed President Thomas Hoenig said a number of risks still clouded the economic outlook, including an overhang of business inventories and a possible slowing in retail spending as consumers increase their saving. He also said historically high levels of business and consumer debt could be a drag on the economy if incomes fall. Hoenig is a voting member of the FOMC this year while Parry and Santomero are not. Santomero said an uncertain outlook for business is likely to depress capital spending. U.S. growth slowed to an anemic 1.0 percent pace in the fourth quarter of last year and has stayed very weak in the first months of 2001 after years of booming consumer spending, business investment and huge stock market gains. Preliminary first-quarter figures for gross domestic product growth are scheduled for release on Friday, and economists polled by Reuters forecast a rate of 1.1 percent. Though the Fed is primarily concerned right now with averting a debilitating recession, Parry said there were clearly inflation pressures arising in certain parts of the economy, energy prices being one of them. But Parry and Santomero both said the slack building up in this current slowdown may provide room for growth to pick up later without generating much inflation. Highlighting one of the few bright spots in the economy, Fed Vice Chairman Roger Ferguson said the housing sector was holding up well despite the slowdown. Ferguson and Hoenig both spoke at the Levy Institute's conference on financial structure in upstate New York.>>

To: Jim Willie CB who wrote (36341)	4/26/2001 7:37:57 PM
From: stockman_scott	Respond to of 65232

Huge Rise In Money-Supply Growth Fueling Faster Economy Or Inflation? By Donald H. Gold Investor's Business Daily A new perception is emerging among players in the financial markets. The economic slowdown won’t last forever, and its end is in sight. Bonds have been falling and stocks rising as investors are suddenly again willing to take on the risks of equity ownership. Another sign the bottom is near: Money supply is rising faster than at any time since the mid-1980s. After all, economic activity is measured in money, and more money means more activity. And money supply has been growing.

To: Jim Willie CB who wrote (36341)	4/27/2001 6:07:36 AM
From: limtex	Read Replies (1) \| Respond to of 65232

JW - Yuor post on Mr G was right on. My guess is that he knows exactly what he is doing and all we will here from him and the other Fed governors about recession is either:- deny deny deny and/or got to be very vigilant about inflation Meantime as you say in the current circumstances the interest rate posture is that of brakes full on. The interesting question is why he should be doing this. As I say I reckon he knows exactly what he is doing and so do the rest of teh Fed governors so what is their plan? Best regards, L

To: Jim Willie CB who wrote (36341)	4/27/2001 7:53:17 AM
From: limtex	Respond to of 65232

JW - There has been a conspicuous change of tone in the posts on the Porch. 1. Seeing posters talking about the past days when tthe used to be LTB&H. 2. Posters starting to buy puts and getting into the feel of being on the short side with all the change ion emphasis that takes. 3. Little interest in the future. I guess all this will change one day but in the meantime we still have fund managers and analysts saying the Naz is way over valued. What crap. The Naz products are like any other, supply and demand and what people are prepared to pay. If confidnece in anything past the end of the day ( if that) changed for the better then the current prices of the Naz stocks would be wewy too cheap and everyone knows it. All this talk from professionals about the overvalued Naz is just hot air. They say that becuase it is the safe thing to say today and they have no confidence in the future of their own judgement of that future. They and I unclude mysefl have simply on idea whethre the economy will recover by the end of this year. In the meantime business for many tech companies is imploding. I for one thought that in a slowdown companies would cut tech investment and infrastructure nvestment in tech last as it would give them the extra revenues and help to cushion the downturn. We are seeing exactly the opposite. Early July was are going to have the same turgid roll call of warnings and earnings cuts as the economy except for the oil industry comes to a grinding halt. And then the big wati for the September qtr and probably the same result. And unemployment and layoffs? Remember last year when Mr G was so concerend about the low unemployment number? Well he and millions of others don't have quite the same worry today. No have blwon up the economy he can presumably now relax as the lay-offs acclerate. Great job. Best regards, L