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

To: energyplay who wrote (34559)	5/31/2003 9:01:34 PM
From: EL KABONG!!!	Read Replies (1) \| Respond to of 74559

hi energyplay, Well, "predicting" the longer term of market performance is certainly becoming more difficult than "prognosticating" the shorter term, that's for sure... <g> Everything I look at right now, sans fundamentals, says the markets are heading upwards. Some charts might be read as to indicate the Dow to go as high as 9300 - 9700. The big wall to cross would be Dow 10,000... And remember, the fundamentals definitely do not support this rise, a "fact" bolstered by all of the current insider selling. Yet, up we go, apparently... Smaller stocks look even better than the large caps. A combination of low interest rates, a decreasing dollar making USA products relatively cheaper abroad, a lack of pricing power by retailers and wholesalers alike, some apparent demand, tons of liquidity, soon-to-be in circulation what-would-have-been tax monies and an explosion of foreign capital looking for either investments or spending bargains almost guarantee the near term rise in US equities. At least for the short term, it appears that the phrase "Don't fight the Fed" may be back in vogue. The dollar should get nowhere near 1.55 Euros, as the ECB will most certainly be forced to take action long before that, perhaps at the 1.20 - 1.22 Euro range. If the ECB were to fail to act, political uncertainty and civil strife would most certainly occur in France, Germany, Spain, Italy and The Netherlands, and Great Britain would once again take another look at the Euro. As Germany, France, and Spain account for the overwhelming majority of European GDP, there is almost no doubt that the ECB would intervene somewhere short of absolute calamity to prevent the Eurozone from financially falling apart at the seams. Gold should rise no more against the dollar than the dollar falls against the other world currencies. If one looks at the performance of gold, as measured in dollars, gold appears to have really appreciated in value. But if one uses Euros or some other currencies to value gold, then the price of gold has hardly budged at all. So, for the time being anyway, gold is merely reflecting the decreased value of the dollar, its official unit of measurement, rather than having actually increased in value on its own uses. I agree with your porcelain throne analogy, quite good actually... KJC

To: energyplay who wrote (34559)	5/31/2003 9:10:34 PM
From: TobagoJack	Read Replies (1) \| Respond to of 74559

energyplay, <<The crash is a process, and some of it has already happend. The BKs have occured, assests sold to new owners, fraudsters have trail dates sets, innocent already lost money, and are back to 'Bank of Mattress', wheat separated from chaff, new crop planted. I will bet the dollar does not go under $1.55 per Euro - that's another 30% not 50% Somewere about $1.25- $1.30 will change the current account pretty quickly, but I expect some overshoot. I think gold will go to $430 -$520 (a big range) but won't go much over $650. The mining companies like NEM will double or triple in price, but that's about it... I guess my view of the bad times isn't someone in the hospital in intensive care after falling off a cliff, but more like a college kid who drank way too much and is now worshiping the porceilan throne and FEELS like they are going to die, but will recover in 48 hours... >> I agree with all that you posted, but I build my case around: (a) Bond bubble (bigger than stock bubble), (b) Refi bubble (bigger still than stock bubble), (c) Monetary printing bubble, resulting in inflation showing up in end-user prices, (d) Continuing financing required for wat-wot, ss/pension, bigger still government bubbles, (e) Old Europe printing a few bubbles in order to incorporate New Europe(no, the US is simply too far away for the necessary tasks), (f) All developed nations printing to counteract 'productivity' bubble effects, (g) Competitive devaluation, decreased global trade, or global equalization of cost/price effects, (h) Expectation of demographic-driven baby-boom bubble resultant changes, and (i) Eventually, the mother of all bubble cures, god awful interest rate increases and credit crunch. It will be difficult to reach equilibrium state when bubbles, echo-bubbles, reverberating bubbles, and new bubbles are going boom and then kaboom in sequence, as in demolition of a building by timed explosive charges, until all rubble are resting at ground floor level. The truly awesome Big Bang is still in our future, and so the genuine shock is still ahead of us. Chugs, Jay