Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Pastimes : Clown-Free Zone... sorry, no clowns allowed -- Ignore unavailable to you. Want to Upgrade?

To: Joan Osland Graffius who wrote (258456)	9/2/2003 2:05:40 PM
From: ild	Respond to of 436258

9:05am 09/02/03 Fed has engineered 'wrong kind of reflation': Merrill By Tomi Kilgore NEW YORK (CBS.MW) -- Merrill Lynch chief quantitative strategist Richard Bernstein said a combination of "aggressive" actions by the Federal Reserve and an "unusual eagerness" by investors to take on risk has led the Fed to engineer "the wrong kind of reflation." "We have reflation of financial assets - reflating the bubble - but we don't have reflation of real assets," Bernstein said in a note to clients. "Reflating the bubble probably ensures that real asset reflation will not occur." He also pointed out that 33 percent of the companies in the S&P 500 reported earnings declines in the second quarter, a higher rate than in the second quarter of 2002. "Although lower quality stocks have outperformed, they are also the majority of the ones reporting deteriorating fundamentals," Bernstein said.