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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: isopatch who wrote (5048)	11/15/2001 1:57:57 AM
From: macavity	Respond to of 33421

Deflation. I agree: Too much oil!! Too much Steel!! Too much DRAM!! Too much storage!! Too many Telco, Chip and PC Companies!! Too much (Optical) Fibre!! Too much coffee!! Too much cotton!! Too many Baseball Teams and Investment Bankers!! Now that the bubble has burst there is too much of everything for the fewer people that want it. There must be some industries, whose goods are in short supply, and can justify price rises. I have no idea. Only guess is health (Biotech?) and security. Its a race between Mr G and the Japanese MOF as to who can print the most currency the quickest. Competitive devaluation. The safer (?) bet is buy the Euro on the dips!! The ECB would never do such a thing. Thank God, that we are not in a recession or else the future would look really terrible. Not a lot of support for the OSX below Sep2001 low! The collapse from May is truly amazing. Anyone who does not believe in the (sub-concious) predictive powers of markets should look at this. How many analysts/commentators have been calling these cheap the whole way down? -macavity

To: isopatch who wrote (5048)	11/15/2001 9:02:26 AM
From: Hawkmoon	Respond to of 33421

Everybody loves the lower prices and lower interest rates at first. But we're in a deflation and it's going to get very nasty next year. Yep... and every economy in the world needs to take the necessary steps to reinflate economic activity (finally the ECB reacted appropriately). And reducing the fundamental costs of such activity are key. The Saudis obviously have wanted to prop oil prices up artificially, despite the global economic weakness, because of their tremendous national debt they have to service.. But Russia understands that it's own hopes for economic growth lie in having ready markets for its goods in the US and Europe. Energy is a cost to economic production. The lower it goes in price, the lower the expenses for the users of that energy, and a greater increase in their profits (theoretically). I recall something from the last year or two, where Sheikh Yamani commented that oil prices were destined to decline dramatically once new Caspian oil finds came on line. This might be the intial realization of that, resulting in the castration of OPEC. Hawk