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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: carranza2 who wrote (15)	9/19/2001 8:05:16 PM
From: smchan	Respond to of 218057

I fully understand your point and agree that gas mileage on SUV's could be better. I'm personally looking forward to Chevrolet debuting their hybrid Silverado in a few years which I'm certain will lead to similar applications in their large SUV's (Avalance, Tahoe, and Suburban). I've read that the Silverado hybrid will offer the same power and towing capacity as their gasoline versions with mileage approaching the upper 20's or better. However... it's cliche to pick on SUV's and those that do so tend to conveniently ignore other gas hogs: luxury cars like the BMW (18.5 mpg in a 5 series V8) for example. Even the Porsche 911 only gets 16 mpg around town. Sam

To: carranza2 who wrote (15)	9/26/2001 10:35:48 AM
From: elmatador	Read Replies (1) \| Respond to of 218057

European investors are accusing the US of causing the economic slump. But they should put their own house in order first Blame telecom companies, not America THE view you see depends on where you are standing. Thus, as I travel the world, the causes and consequences of recent stock-market turmoil are seen very differently. Europeans see most of the problem as centred on America. The idea that the American economy can avoid a deep and prolonged recession offends a lot of people's sense of natural justice. A similar view is often heard in Asia, where many people believe that America experienced a bubble similar to Japan's, and the consequences will be the same - years of slow or no growth. Americans, characteristically, are more upbeat. Sure, anybody who has been severely damaged by the rout of the Nasdaq is far from happy. But the idea that America became a nation of technology- obsessed day traders is wide of the mark. For most people, the value of their house is more important than Cisco's share price. Thanks mostly to the efforts of the Federal Reserve chairman, Alan Greenspan, house prices are up 7% compared with a year ago. Wall Street is sending one message, Main Street another. Take a shopping trip to any American city and you will see consumers still happily spending. The data confirm this image: companies have ceased spending but shoppers are keeping the economy afloat. Companies have stopped investing because many of them indulged in an orgy of capital spending during the bubble years. But it is important not to push this idea of "overinvestment" too hard. Old-economy companies rarely got involved. The biggest culprits of irrational exuberance in America and everywhere else were a lot of companies involved in the telecommunications business. Be they old-fashioned carriers of fixed-line calls, mobile-phone operators or suppliers of kit to either business, too many companies invested too much money in too much capacity. For Americans, the bubble and crash are easily explained: investors didn't know how to value technology stocks. Now they do. The bubble in anything telephony-related was accompanied, with unfortunate timing, by the maturing of the PC business. Telephony, I am told by many investors, is still a black hole. But, they assure me, it is one that will be sorted out quickly, at least in America. The American response to foreign critics is simple. Yes, we became far too confident about all those claims about a "new economy". We haven't managed to abolish the business cycle, nor can we stop companies doing silly things. But, they say, we will emerge stronger from the wreckage. At last month's annual gathering in Jackson Hole of the great and the good from government, the Federal Reserve, Wall Street and big business, a clear message emerged. The most important aspect of the "new economy" - higher productivity growth - is intact. Economists have tried to put a precise number on the trend rate of growth of the American economy but their pedantic debate is far less interesting than two incontrovertible facts. First, sustainable growth is a lot higher than it used to be. Second, it is much higher than anywhere else in the developed world. The American perspective on the world is clear. The American economy is cycling around a trend rate of growth of between 3% and 4%. The eurozone's maximum rate is 2% and Japan's is zero. On this line of reasoning, if there is a problem for the world economy it is not to be found in America. Despite the avowed scepticism in the rest of the world about American prospects, it would appear that hard-headed investors still cannot find a better place to put their money. The American economy represents about one-fifth of the globe but manages to attract about two-thirds of the world's available capital. The dollar has eased back a touch recently but is still near all-time highs. If ever there was a time for the American currency to crash, it surely should have done so this year. The time to become seriously concerned about the dollar is when Europe and Japan start to compete effectively with the United States for the pot of global capital. Stock markets send the same message. The broad American market is down 16% this year. German, French and Japanese markets are all down by 24%. Economic downturns in America are uncomfortable affairs. In Japan and the eurozone they are tragedies because the corresponding upswings are so feeble. Few of the global doom merchants are convinced by much of this. Ultimately, their arguments rest on a central hypothesis: America is like Japan circa 1990. But this has to be wrong. In Japan the central bank made multiple errors, such as keeping interest rates high for too long - hardly something that the Federal Reserve stands accused of. The bubble in Japan was broadly based across all equities and extended to property. Not so in America. Pessimists argue that this will be the first investment-led recession in America since the 19th century and, like those cycles of old, the downturn will be prolonged. It would be more accurate to describe present conditions as the first telecoms-led downturn in history. This was a most peculiar cycle and arguably, the consequences of the telecoms bubble could be greater in Europe than in America. The focus has been on American overinvestment, but Europe has been guilty as well - perhaps more so, given the peculiarities of 3G. Markets are starting to fret that one or two companies may have dug a hole for themselves that they cannot get out of, at least without considerable outside help. The main reason why America is not Japan lies with the behaviour of the corporate sector. In Japan, companies just froze. The response of American companies has been to start the painful process of restructuring. There is still plenty to do - and the stock market is rightly concerned over this - but the point is that the response has already been swift and dynamic. All of these debates are going to have to be resolved before stock markets regain their poise. The specific problems of many telecoms-related businesses are still too great. But when markets turn, as they inevitably will, America will still rightly attract the bulk of the world's capital. This is what European and Japanese policymakers should be concerned about, not the vagaries of the American business cycle. Chris Johns is global strategist at ABN Amro Irwin Stelzer is away