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

To: tradermike_1999 who wrote (10925)	10/31/2001 4:04:02 PM
From: Louis V. Lambrecht	Read Replies (1) \| Respond to of 74559

tradermike - my Fib retraces are anchored Aug 27th. Do I miss something? eom

To: tradermike_1999 who wrote (10925)	10/31/2001 4:27:12 PM
From: lisalisalisa	Read Replies (1) \| Respond to of 74559

I REALLY enjoy your commentary. Thanks for posting them.

To: tradermike_1999 who wrote (10925)	10/31/2001 4:50:57 PM
From: smolejv@gmx.net	Respond to of 74559

tradermike rules OK. dj Thanx btw

To: tradermike_1999 who wrote (10925)	10/31/2001 5:19:54 PM
From: SmoothSail	Respond to of 74559

Nice piece. First time I've seen it so articulately spelled out.

To: tradermike_1999 who wrote (10925)	10/31/2001 5:53:19 PM
From: MulhollandDrive	Read Replies (2) \| Respond to of 74559

Hi tradermike... Could you tell me what your opinion is of the Federal Reserve retiring all 30 year debt? biz.yahoo.com .S. 30-year Treasury bonds powered up on Wednesday in their biggest-ever one-day price move after the Treasury surprised the market with an announcement it would no longer sell them, triggering a mad investor rush to snap up the securities. ADVERTISEMENT The rally, which saw the biggest move in bond yields since the 1987 stock market crash, was infectious. It lifted most of the Treasury market with it, driving up benchmark 10-year notes more than a full point and boosting five-year notes in a mad swoop that one market strategist called ``insane.'' Only two-year notes were left flat on the day, pressured by earlier news that the economy contracted less than expected in the third quarter, which scaled back hopes of an aggressive Federal Reserve interest rate cut next week. ``Usually the Treasury gives us a little bit more notice. This was obviously a huge surprise,'' said Steven Saslow, proprietary trader at HSBC Securities in New York, as bond prices soared more than 5-1/2 points. Thirty-year Treasury yields -- which have fallen little as the Fed has slashed interest rates nine times this year -- crashed more than 30 basis points to their lowest rates since October 1998 tia...

To: tradermike_1999 who wrote (10925)	11/1/2001 3:18:38 PM
From: Maurice Winn	Read Replies (2) \| Respond to of 74559

Tradermike, Alan Green$pan has done a good job. The dot.com mania and telecosmic irrational exuberance had nothing to do with his money supply management. It was all to do with ignorant people thinking they had hit the jackpot and that those two huge industries and a lot more besides would rain loot on them in vast quantities. Whether Uncle Al printed, didn't print, had interest rates up or down or going round and round wouldn't have affected the mania. It was a mass brain spasm which did not match reality. When brain spasms and reality don't match, it is the brains which get mashed. So they have been. Now, people understand that they are not all passing go and collecting $200 on a single lucky throw of the dice. Now they are all having to get a real job, do something useful, stop spending the wealth effect and start worrying about the poverty effect. They no longer have sudden wealth syndrome. They have sudden poverty syndrome. While exactly the same [actually, a lot more due to printing a lot more] US$ are circling around the planet looking for a maximum return, the bidding on nearly all companies is less than at the height of the hysteria. The dot.coms and telecosms have been bid down to tiny fractions of their heights. So the 'wealth' that the world though it had was imaginary. Because that false belief in wealth caused millions of people to dramatically alter their economic behaviour, such as quitting their jobs, buying flash houses, expensive cars, going flying [first class] around the world and staying in nice hotels, meals and Dom Perignon, there was a dislocation in the preceding economic pattern. Now that the crunch has come, there is a market clearing process [which is quite painful and takes time] while economic activity reorients around the actual reality of how wealthy people really are. People have learned that they were nowhere near as wealthy as they thought they were. Alan Green$pan has to try to maintain a stable currency while these florid states of market hysteria lurch around. His job is like trying to maintain a constant metre, a fixed kilogram and steady degree Kelvin while some uncontrollable lunacy jerks them around. Money isn't a component of nature, like a metre, kilogram or Kelvin degree, which are fixed by nature. Money is an abstract concept which can expand or contract. The intention of monetary authorities is to maintain money in stable relationship to how much people can earn per hour, what things cost to buy and interest rates. They don't just print trillions of dollars to spend themselves, because that would destroy the currency value and disrupt economic activity. Neither do they simply print a fixed number of dollars and leave it to markets to trade them. Printing a fixed number of dollars would result in substantial deflation as costs of production drop. Deflation isn't popular. By printing and managing interest rates, lending criteria and stuff, they can maintain the currency in a steady relationship to economic activity. But they can't control irrational exuberance and irrational exuberance is hard to identify anyway because some things really do deserve higher valuations. In the latter stages of the dot.com and telecosmic excitement, it was obvious to most that the prices were overdone - at which time the huge selloff started. Irrespective of what Uncle Al did, that process would have happened. By increasing interest rates and squeezing the hysteria, he brought it to a stop a little before it might otherwise have happened. Which is good. Now, he's printing like there's no tomorrow, which there might not be for a lot of people, in an attempt to prevent irrational gloom. By reducing interest rates and printing, he's making holding money unattractive, which will cause people to go shopping, investing and moving money to things where people figure they'll get a better return than the bank. It baffles me that people have such antipathy to my idol Uncle Al, who is always on top of things when he gives his reports to Congress etc. He knows what's up. His interlocutors seem to be halfwits economically, [and in other respects too] and it's obvious why he is the one in charge of the money. People want to blame somebody. Well, blame the ignorant mob who bid Amazon.com to the sky, Globalstar past the sky and most of the market into the wild blue yonder. Don't blame the person who supplies the metres, kilgrams, deg Kelvin or $. Blaming a foundering lumber business on the length of a metre shows a lack of understanding on how things work. Firing the guy supplying the metre measurement system won't make people buy lumber. Uncle Al has done a great job. I might sell my USA stocks if he gets fired because it will shatter my confidence that the people running the USA know what they are doing. I think I'll invest in China instead. If many people think like I do, you can guess what that will do to the USA markets and USA economy. Mqurice PS: In October 1999, I attended Telecom99 in Geneva and wrote in SI that it was like being at the centre of a nuclear explosion going critical. That mass excitement and irrational exuberance was not founded on interest rate cuts. Neither was the dot.com hysteria. Those who blame interest rate movements have got it wrong. When those huge over-ratings collapsed, it took all else with it because when Globalstar goes to near zero and you get a margin call, it means you have to sell something else. Globalstar sucks, therefore sell QUALCOMM [apologies to Jon Koplik]. The margin borrowings were only somewhat related to the interest rates charged [I know because I was there].