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.

Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Haim R. Branisteanu who wrote (9033)	7/10/2004 4:16:43 PM
From: Knighty Tin	Read Replies (2) \| Respond to of 116555

Haim, These guys are so courageous. <G>

To: Haim R. Branisteanu who wrote (9033)	7/10/2004 5:06:34 PM
From: mishedlo	Read Replies (1) \| Respond to of 116555

how accurate have they been. Did they correctly call the last rally from 1.30 to 1.18 or whatever it was M

To: Haim R. Branisteanu who wrote (9033)	7/10/2004 9:55:35 PM
From: mishedlo	Read Replies (1) \| Respond to of 116555

The editor of the Russian edition of Forbes magazine was shot and killed outside his office Friday, thestreet.com

To: Haim R. Branisteanu who wrote (9033)	7/10/2004 9:58:41 PM
From: mishedlo	Respond to of 116555

The Fed Is to Blame forbes.com Pity the Fed. With its first quarter-point increase in late June, the central bank is trying to unwind years of leaping financial leverage and speculation without heavy casualties. Ironically, the problem is largely the Federal Reserve's own doing. When Chairman Alan Greenspan made his December 1996 "irrational exuberance" speech, the stock rally was 14 years old, a good time to curb excesses. But rhetoric was all Greenspan deployed. There was no action. The gun-shy Fed didn't even send a sobering signal by raising margin requirements, the amount investors must put up to borrow for stock purchases. So rampant dot-com speculation unfolded. The bubble, rivaling that of the late 1920s, spilled over to make the economy hyperactive. When the Fed finally got serious and started to tighten in June 1999, it was too late. Then, as stocks collapsed, the credit authorities shifted to massive easing to save the economy from a horrible recession and to fight deflation. Unfortunately, this did little to stamp out the excesses, which simply shifted into housing and consumer spending. With low rates, money for mortgages and credit cards remained ample. Tax cuts and leaping government spending helped fuel the spend-a-thon. The value of owner-occupied residences mushroomed from $8.7 trillion in the fourth quarter of 1997 to $15.2 trillion in the first quarter of 2004, bringing along with that much higher debt burdens. The home equity craze allowed people to plunge even deeper into debt to buy flat-screen TVs, boats and vacations. A nationwide fall in house prices, the first since the 1930s, would be devastating to the 69% of American households that own their own abodes. Big mortgage financers Fannie Mae and Freddie Mac, with $1.7 trillion in debts, could require government bailouts........... ...................

To: Haim R. Branisteanu who wrote (9033)	7/10/2004 10:00:12 PM
From: mishedlo	Respond to of 116555

How the Futures Market Can Miss the Mark on Rates nytimes.com FOR weeks now, the financial question of the day has been this: How fast and how far will the Federal Reserve raise short-term interest rates? For a clue, professional Fed watchers, journalists and even Fed policy makers often turn to the futures market, where monthly contracts for the federal funds rate provide an up-to-date indication of investor expectations. The Fed funds rate, charged on overnight loans of bank reserves, is the benchmark interest rate set by the Fed policy makers. On June 30, they raised it to 1.25 percent from 1 percent. And as of Friday, Fed funds futures contracts indicated that investors were betting that the rate would rise by 0.86 percentage points, to an average of 2.11 percent, in January. Of course, this contract isn't a perfect predictor of what the Fed will do six months down the road. Unfortunately, a new study published by the National Bureau of Economic Research casts doubt on its reliability even as a tool for gauging the views of investors. What's worse, because Fed policy makers review the contracts to assess market expectations about interest rates, the futures contracts may even be warping the decisions of the Fed itself......... .............