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Technology Stocks : Semi Equipment Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Sarmad Y. Hermiz who wrote (28974)	3/1/2006 7:23:40 PM
From: auriculatus	Read Replies (2) \| Respond to of 95757

How about Mr. Joe Average that lives off of his credit and second mortgage to keep up with the neighbors? A pile of these ARMs will get adjusted upwards by two percent, which will take a bite out of consumer spending. But then again, what do I know. Most likely the market will break out to the upside and NVLS will be at 40 in June after I deliver at 27.5!

To: Sarmad Y. Hermiz who wrote (28974)	3/1/2006 7:34:09 PM
From: Return to Sender	Read Replies (1) \| Respond to of 95757

I don't buy that argument Sarmad. It's the relationship between short term rates and longer term ones that makes all the difference. Not the absolute level of interest rates at any point on the curve. The fact that long term bond investors are getting less than short term ones means that the money supply is tighter than it has been. Rates are being raised too high. Bond investors are locking in whatever they can get. The only reason this happens is because bond investors have already come to the conclusion that the economy is likely to slow. They think they won't get higher yields in the immediate future. Bond investors could be wrong but the deeper the yield curve inverts the greater the risk of a recession. Even without a recession the stock market could sell off hard. It did in 1998 with a lot less notice from the yield curve. RtS