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Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: Softechie who wrote (8253)	11/26/2001 10:48:34 PM
From: Siddhartha Gautama	Respond to of 99280

good point that the fed funds rate is below inflation rate. yet, it is not clear to me if the difference between the two rates is a risk free arbitrage opportunity. nor is it clear if the difference between the rates is sufficient to cover the costs of all the participants in any such arbitrage. of course, it sure forces (and/or justifies) asset reallocation. per trimtabs, it looks this flow is coming to an end soon. every rate cut from this point on will geometrically reduce the importance of fed as an institution. the million dollar question here is: is our financial system sufficiently screwed to justify a jaPAN? some related notes follow: based on talking to people, the real estate didn't seem to have bubbled outside of san francisco bay area, new york city and seattle area. perhaps, all excesses were confined to margin accounts and credit cards. so, jaPAN is low probability. also, as the world's most powerful nation state, USA could well be able to shift a good deal of this burden to other prosperous but less powerful nation states.

To: Softechie who wrote (8253)	11/27/2001 7:33:06 AM
From: s berg	Read Replies (1) \| Respond to of 99280

Warren Buffett's recent analysis of the market fortune.com is especially critical of pension fund managers over decades of investing. Not reassuring if Trimtab's is correct about their being the cause of the current rally. Another interesting part of article is that he is also very critical of how current P/E ratios are computed including future projections of pension fund investment earnings (a recent change in the rules). Yet he uses current P/Es to project future appreciation of market.