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To: 4rthofjuly007 who wrote (19764)	11/6/2001 11:40:05 PM
From: NOW	Respond to of 209892

Took it away in '99? Please check your figures pre Y2K.

To: 4rthofjuly007 who wrote (19764)	11/7/2001 2:29:22 AM
From: At_The_Ask	Respond to of 209892

I think the real problem is derivatives. Derivatives are spun as a way to lay off risk. But they are really just the medium of choice for speculating on a colossal scale. LTCM was a classic example of how these bozos use incredible leverage on a grand scale in order to profit. The only problem is that this "house of cards" cannot be allowed to collapse. The fallout would be devastating including bank failures unwinding of gold carry trade positions... international chaos basically. I think AG was in the position of having to bail these clowns out because the consequences of not doing so would be grave indeed for everyone else if he did not. The international banks and investment houses do as they please and no one regulates them. No one even truly knows what they are up to. They have the power to crush the currencies of countries that dont play along with them. Who is to say they dont act in unison to create whatever situations they want. Anyway I think the bubble was caused by massive inflows of dollars into the US from foreign countries. Look at the trade deficits we have been running. All those dollars need to be put to work somehow and the best way has been to plow them back into US stocks and bonds. Our debt and equities are the premium stuff of all world markets. This is why economists are confused by why the dollar is so strong even though we run huge trade deficits. Generally countries that run high deficits suffer currency declines. But not the US because everyone plows them right back into the US markets and in order to do that you have to go through the clownbuck; which creates dollar demand. Its a bit of a paradox. If this trend reverses watch out! The bubble of 29 was caused by massive inflows of gold into the US after WW1. We profited tremendously by selling arms and food to the Allies at war heightened prices. It took them many years to pay us back in gold not to mention German war reparations. At the time I believe it was estimated that 3/5 of all the worlds gold belonged to the US. Whenever there is an excess of capital\credit it will be utilized for investing and building needless production capacity. Just like you and I when we get some extra cash we put it to work in the markets. Japan is another example of what happens when too much wealth accumulates in one economy. They ran their market up too the moon and then they bought all the US debt in existence, but look at what has happened to them now.