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Strategies & Market Trends : Stock Attack II - A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: dawgfan2000 who wrote (32296)	3/15/2002 6:37:09 AM
From: Lee Lichterman III	Respond to of 52237

Thanks, the larger than normal volume caught my eye the other day with little price movement two days running. I figured something was up. QQQ Max Pain still hovering between 37 and 38 Some highlights from Greenspan's speech Wednesday.... .........Stocks in many industries have been drawn down to levels at which firms will soon need to taper off their rate of liquidation, if they have not already done so. With production running well below sales, the lift to income and spending from the inevitable cessation of inventory liquidation could be significant. But that impetus to the growth of activity will be short-lived unless sustained increases in final demand kick in before the positive effects of the swing from inventory liquidation dissipate. .............. ============= .........Most recoveries in the post-World War II period received a boost from a rebound in demand for consumer durables and housing from recession-depressed levels as well as an abatement of inventory liquidation. Through much of last year's slowdown, however, spending by the household sector held up well and proved to be a major stabilizing force. As a consequence, although household spending should continue to trend up, the potential for significant acceleration in activity in this sector is likely to be more limited than in past cycles. ............... =============== ....................the broad contours of the present cycle have been, and will continue to be, driven by the evolution of corporate profits and capital investment. The retrenchment in capital spending over the past year and a half was central to the sharp slowing we experienced in overall activity. On balance, the recovery in spending on business fixed investment is likely to be only gradual; in particular, its growth will doubtless be less frenetic than in 1999 and early 2000--a period during which outlays were boosted by the dislocations of Y2K and the extraordinarily low cost of equity capital available to many firms. ........... ================== .................Most economic forecasts are subject to significant uncertainty. At least by comparison, one judgment looks to be a reasonably sure proposition: The ratio of retirees to those still working will rise precipitously starting at the end of this decade and will continue to climb through the first third of this century and remain high thereafter. In part, this projected development owes to the retirement of the baby boomers. But the phenomenon is broader than that and reflects the aging of our society. Importantly, according to the social security trustees, the demographic challenge will not go away with the passing of the baby-boom generation. .................... ===================== ..........immigration accounted for approximately one-third of the increase in our workforce............. ................Immigration policy will, therefore, be a key component of baby-boom retirement policy. .............. =================== ............During the past six years, about 40 percent of the total increase in our capital stock in effect has been financed, on net, by saving from abroad.......... ...............As the stock of such claims grows, an ever-larger flow of interest payments must be provided to the foreign suppliers of this capital. Countries that have gone down this path invariably have run into trouble, and so would we. Eventually, the current account deficit will have to be restrained. The nation's economic potential will be brighter if that comes about through an increase in domestic saving rather than a reduction in domestic investment. .............................. =================== ................How much personal stress--and, some argue, increased inequality, which may be a byproduct of a highly competitive, high-octane economy--have we as a nation chosen? Is the amount compatible with the level of domestic saving and possibly the risk-taking that is consonant with the elevated level of productivity growth necessary to meet the needs of an aging population? A national consensus on these questions is clearly missing. This is doubtless an area for useful debate. ..................... federalreserve.gov Good Luck, Lee