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

To: Seeker of Truth who wrote (44723)	1/15/2004 3:31:56 AM
From: EL KABONG!!!	Read Replies (1) \| Respond to of 74559

Hi Malcolm, I'm glad to hear that food and energy are not that important. The prices that really matter are those, I take it, of perfume and popular music CDs. And the loss of jobs is illusory, temporary, about to reverse, etc. After all the economy is gathering strength. The 38 billion balance of payment deficit per month is small enough to be neglected. Ah, you're finally getting with the program... <vbg> Actually, I didn't write the article. I just posted it for commentary sakes. A few posts back, someone posted that s/he couldn't find any value stocks at all, and the others were overvalued (or over-bought, something like that). I'd have to concur with that sentiment. There's darn little available out there in the way of equities that seems like a bargain price. However, the alternatives (money markets, passbook savings, bonds, real estate, etcetera) look like worse returns, and some even have higher risks than stocks. Stuffing the old mattress with some Aztec currency might be the way to go. Who really knows for sure? KJC

To: Seeker of Truth who wrote (44723)	1/15/2004 9:31:08 AM
From: pezz	Respond to of 74559

<<I'm glad to hear that food and energy are not that important>> ya know it's my opinion that moderate inflation in itself ain't bad for stock prices...Before everyone jumps down my throat let me say that stocks are a holding on assets that go up in value and co's raise prices in times of inflation. Having said that it's obvious that stock prices go down during inflationary times. IMHO this is becauz of the rising interest rates that accompany inflation. That is if interest rates did not rise stocks would be a flight to safety in inflationary times. IF one assumes that higher rates are a result of FED action ( not strictly true of course ) and rising food and energy cannot be effected by FED action ( thus reducing the incentive for the FED to tighten ) then one can see how rising food and energy costs don't carry the same weight of "perfume " with regards to underling inflationary trends. Remember rising food and energy don't necessarily indicate that inflation will grow in the future ...riseing prices for "perfume" OTOH may be telling us that the economy is overheating....Not saying that food and energy don't matter just that they don't matter as much with regards to interest rates and consequently stock prices..