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

To: KyrosL who wrote (68980)	5/17/2002 9:03:02 PM
From: t2	Read Replies (1) \| Respond to of 99280

an orderly decline of the dollar will not necessarily be bad for US stocks Maybe a strong recovery combined with an orderly decline in the dollar could help stocks..but the one thing I would note is that interest rates back in the 1980s were a lot higher than they are right now. Could that be a key difference? This is commentary that suggests the DOW could rally while the dollar drops. (written by a gold bull) kitco.com

To: KyrosL who wrote (68980)	5/18/2002 7:28:21 AM
From: longdong_63	Read Replies (1) \| Respond to of 99280

Kyrosl..."George, an orderly decline of the dollar will not necessarily be bad for US stocks." Maybe, but the conditions are much different than then...we have war on the horizon, post bubble era, huge M3 problem, consumers and corporations loaded with debt, rising unemployment, possible bubble in housing, trade wars just starting, huge Fed liquidity problem, bear market just beginning in bonds, etc. etc. This time is different.

To: KyrosL who wrote (68980)	5/18/2002 2:02:47 PM
From: Crimson Ghost	Respond to of 99280

An orderly drop in the dollar will indeed improve the profit prospects of some industries. But it will also hike interest rates and spur an outflow of foreign capital -- putting downward pressure on still very high multiples. Too, it is not at all certain that the drop will be orderly. I am not sure that comparisons with the late 1980s are valid. US trade deficits are hugely higher now as are foreign holdings of US financial assets. And US stocks are much more expensive.