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To: Rosemary who wrote (26981)	1/6/1998 4:31:00 PM
From: Lee	Read Replies (1) \| Respond to of 176387

Rosemary, Even with the interest rate at 5.72%, the yield on the long bond is still approximately 4% above the yield on the S&P last I heard. I presume this is for people who can't pick growth stocks (Dell) or who depend on dividend yield, else, I don't know why that comparison is made. But you are right, if I wanted to lock in gains for the next year, I might consider treasuries if the interest rate was at 7% or better, but now, no way. The stock market seems to be diverging from the bond market but I haven't any clues as to why. Ordinarily, stocks gain as interest rates go down. Must be all the gloomy morning news from ML and Maria. But the Util average is diverging big time from the bond yield so maybe the stocks are paying attention to that. It would be a very nice profit if someone was long the bond from last Sept. My crystal ball didn't foresee this nice runup though. I guess what's holding the bonds up is that the Asians keep buying treasuries since their currencies are tanking and their stocks are declining. Use to be they could borrow in Japan at 0.5%, buy treasuries at 7% and make a tidy 6.5%. Lee