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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: el_gaviero who wrote (23970)	1/2/2005 1:51:38 PM
From: Raymond Duray	Respond to of 110194

Re: The intervention of government makes a chaotic adjustment to the true nature of the underlying realities of the economy an inevitability. If you read Charles Mackay's "Extraordinary Popular Delusions..." , Chancellor's "Devil Take the Hindmost" or Kindleberger's "Manias, Panics, and Crashes" I believe you will agree with me that the market is perfectly capable of completely irrational panics without any government intervention. In the cases of the Tulipomania, South Seas Bubble, Mississippi Bubble, the Panics of 1837, 1873, 1907, the crash of 1929 and the panic of 1987, there was certainly a "chaotic adjustment to the true nature of the underlying realities". And in those cases, the government was not intervening in the market's self-destructive writhing. These periodic destructive circular firing squads are what the PPT is designed to curtail. I think that's a good thing. *** George Soros happens to be someone I greatly admire. He has stated repeatedly that there is a silly myth among the denizens of Wall Street that the Market is self-correcting. Soros made his billions betting on exactly the opposite, i.e. that markets are irrational and that the pendulum swings too far from time to time. I find these to be wise words. And I find that the PPT, while a crude mechanism, does tend to moderate the excessive "animal spirits" of Mr. Market when he goes on his never ending benders.