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Pastimes : Ask Mohan about the Market -- Ignore unavailable to you. Want to Upgrade?

To: Cynic 2005 who wrote (6973)	11/4/1997 2:05:00 PM
From: Defrocked	Read Replies (1) \| Respond to of 18056

The Fed has to assume a "do-nothing" mode and they do not like being backed into this inflexible corner. Raising interest rates now would assure a recession IMHO. And lowering interest rates will quickly reinforce the notion that the Fed cannot "control" the price of money. The ensuing inflationary potential, damage to their reputation of vigilence and rapid rise in long term yields would take years to correct. AG and the Board will only provide limited reserves to temporarily cash-strapped banks and will necessarily sit back and say "WE TOLD YOU SO". BWDIK.

To: Cynic 2005 who wrote (6973)	11/4/1997 6:10:00 PM
From: Zeev Hed	Respond to of 18056

Mohan: I doubt the Fed's realy want to keep the market within a narow band of 5% from fair valuation. I think they try and avoid runnaways of any kind, either up or down, since such run aways have a tendency to misappropriate capital on one hand and to cause sudden dearth of capital on the other. As Invetors I think we should realize that the market often overstays its enthusisam and depression, like a manic-depressive patient. Right now, we have, I believe seen the first sings of a break in the upward momentum to extreme valuations. Is this correection the one that will bring us back bargains like we had in August of 1982? I do not know, but one thing does seem clear, the knee jerk reaction to the last drop has dissipated pretty fast, and I am afraid (for the bulls) that come next Monday, we can expect another black one. AS a matter of fact, I think that by tomorrow afternoon a decline will start culminating in a very severe decline Monday. The weakest sisters will most probably be the LRCX, KLIC and ASND and even the AMAT and CSCO of the market. Zeev