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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: LLCF who wrote (21415)	7/18/2002 11:17:12 AM
From: calgal	Respond to of 74559

Rational Cautiousness The press gasped when Bush and Greenspan failed to bolster the Wall Street, but the market is behaving rationally. by Christopher Caldwell 07/18/2002 12:00:00 AM Christopher Caldwell, senior editor TUESDAY NIGHT on the "CBS Evening News," Dan Rather described Fed chief Alan Greenspan's testimony before the Senate Banking Committee in these terms: "President Bush couldn't do it; today the chairman of the Federal Reserve tried to calm nervous investors and stop the slide on Wall Street. Alan Greenspan, who once warned against 'irrational exuberance,' today was cheerleading 'cautious optimism.' For a while, it appeared to work." This is a phony narrative arbitrarily superimposed on Greenspan's testimony. Why does Rather assume that "stopping the slide on Wall Street" is what Bush and Greenspan have been aiming to do? Greenspan, it is true, doesn't want the collapse in share values to become irrational. But who does? If there was any evidence in Greenspan's testimony that he believes the slide is irrational thus far, I didn't see it. The president has explicitly disavowed speculation that his remarks were meant to prop up market values. ("He would say that," I hear you grumble, "wouldn't he?") Why should either Bush or Greenspan try to trick the market into heading upward? At the core of the recent stock-collapse is an accounting scandal. The misconduct involves companies manipulating the books to show profits that didn't exist. Ipso facto, once that misconduct is made public, all rational stock buyers will assume that stocks are worth less, on average, than we thought they were before. How nuts would an investor have to be to continue to pay the old, pre-scandal share price? So the collapse in values has a silver lining. It means there is a link--imperfect, but nonetheless real--between earnings (or lack thereof) and share prices. It assures us that the stock market retains a certain resistance to bubbling. If investors could be induced by political sweet-talk into paying the same price for a product known to be debased, we would have no such assurance. "Stopping the slide" is not what Bush and Greenspan are trying to do. It's not even what they should do. It's merely what Rather and a lot of other nervous investors selfishly wish they could do. Christopher Caldwell is a senior editor at The Weekly Standard. weeklystandard.com

To: LLCF who wrote (21415)	7/18/2002 8:14:27 PM
From: Maurice Winn	Read Replies (2) \| Respond to of 74559

DAK, Uncle Al has succeeded. For 15 years, his business has been booming. He has beaten the cyberspacoids, the telecosmics, the biotechs, the political systems of alien countries, OPEC, gold and any other contender for tradeable value. His profits and prophetics have been amazing. The USA till is overflowing with dosh which is funding the biggest military, political, technological and economic system the planet has seen. It's funny seeing people in SI who can more or less grunt in monosyllables, with sentences less than five words long, saying that Green$pan is unintelligible, confused etc. Actually, Uncle Al is amazingly articulate, witty, perspicacious, economically literate and intelligible. Of course, a dog listening hears, "grhafo aodnhfhe odainfh eohnerhe donafe g'ghnoned noefeneonaf walk fjjoijwf ereoj" and is completely bamboozled. It takes a listener with a receptive brain to hear what's being said. The dog hears the word 'walk' and figures 'let's go' and thinks they have the plot. They are then disappointed when things don't turn out to be a 'walk' [which really, in dog lingo, means 'go outside, run around and smell stuff and pee and chase cats and have a lot of fun'. Mqurice