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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: LLCF who wrote (4098)	6/1/2001 4:10:45 AM
From: elmatador	Read Replies (1) \| Respond to of 74559

But if capital flight keep coming to the US as it has been the case in the past, you can keep doing well without much problem. See, everytime there an economic meltdown somewhere, there is one attractor to all the cash flying out those places, South America, Russia, Asia... Besides that, let me give you an example: The capital I defend most (my 5-year old daughters school tuition already saved)- I keep in no other currency but USD in an offshore account. So if we foreigners keep a demand for a good (USD)that is only made in the US, the USD dollar will always keep strong.

To: LLCF who wrote (4098)	6/1/2001 5:11:04 PM
From: pater tenebrarum	Read Replies (1) \| Respond to of 74559

what's even more disturbing is that with the economic slowdown and the continued excessive ballooning of financial sector and other balance sheets (even the telcos continue to increase their debt load) this ratio has now grown even worse. imo the point has been reached, in both the stock market and the economy, where no matter how much more money and debt is thrown at them, no further progress can be made. the effect of mufu inflows on the SnP has indeed turned NEGATIVE for instance. in 2000, RECORD inflows have produced a negative return(indicating that prices are simply too high). this decline in dollar efficiency in the stock market probably applies to the entire economy now too: as mentioned on other occasions, lower rates and money printing can not solve the problems of industrial overcapacities and private sector overindebtedness...on the contrary, they are liable to make the problem worse, by postponing its resolution.