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To: Moominoid who wrote (131533)	4/1/2006 10:31:40 PM
From: Henry J Costanzo	Read Replies (1) \| Respond to of 209892

FA............FA..........FA No views AORD or FTSE, David.....Otherwise disagree with you on practically all counts...gg See no basis for changing my views interest rates. IMHO Fed increasingly likely at this point to effect at least two more hikes...moving to 5 1/4 minimum....No way this can mesh with the top in Treasury yields you see and with a fall in the USD. I have regularly posted my counts for the USD, and IMHO nothing points as yet to any reversal of the impulsive rally which began in December 2004. As to bonds having an ABC correction off the lows, had a discussion recently with Shack, who would agree with you. I cannot, however, agree with the view that we are simply correcting the huge historic bull market in bonds, and will move again into even lower rates.....That would be looking for Japanese-style....or even 1930's US-style,,,depression/deflation. Rates IMHO are due for an impulse up... of historic significance. As you know, I have been a proponent of an ED in US equities now underway...I think that may follow, if it occurs, quite a substantial rally still ahead....and that would imply, of course, a fall in the equity markets at some point later in the year,.or possibly into 2007..BUT I would certainly not project a fall back below the 2002 lows (unless of course, the depression/deflation implied by your interest rate projections indeed come to pass...gg). Premature to judge, but I see no reason why we shouldn't contemplate that the 2002 rally corrected in 2006 (or 2007) should resume an impulsive move of many years duration... All FA....but IMHO also consistent with most of the charts I see.

To: Moominoid who wrote (131533)	4/1/2006 10:31:40 PM
From: Henry J Costanzo	Read Replies (1) \| Respond to of 209892

FA............FA..........FA No views AORD or FTSE, David.....Otherwise disagree with you on practically all counts...gg See no basis for changing my views interest rates. IMHO Fed increasingly likely at this point to effect at least two more hikes...moving to 5 1/4 minimum....No way this can mesh with the top in Treasury yields you see and with a fall in the USD. I have regularly posted my counts for the USD, and IMHO nothing points as yet to any reversal of the impulsive rally which began in December 2004. As to bonds having an ABC correction off the lows, had a discussion recently with Shack, who would agree with you. I cannot, however, agree with the view that we are simply correcting the huge historic bull market in bonds, and will move again into even lower rates.....That would be looking for Japanese-style....or even 1930's US-style,,,depression/deflation. Rates IMHO are due for an impulse up... of historic significance. As you know, I have been a proponent of an ED in US equities now underway...I think that may follow, if it occurs, quite a substantial rally still ahead....and that would imply, of course, a fall in the equity markets at some point later in the year,.or possibly into 2007..BUT I would certainly not project a fall back below the 2002 lows (unless of course, the depression/deflation implied by your interest rate projections indeed come to pass...gg). Premature to judge, but I see no reason why we shouldn't contemplate that the 2002 rally corrected in 2006 (or 2007) should resume an impulsive move of many years duration... All FA....but IMHO also consistent with most of the charts I see.