Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Tommaso who wrote (13959)	2/10/1998 2:33:00 PM
From: Mike M2	Respond to of 18056

Tommaso, great post I absolutely agree. I suspect we will see protectionism -for practical matters we already do-currency devaluations. Perhaps in the 30's the U.S. was in a position to be a buyer of distress goods BTW this is the only hope for a bailout of SEA in my opinion. The question is are we willing and able to pay the price-record trade deficits and loss of U.S. jobs. My answer is no on both counts. Steve Appleton spoke before the Senate and made some great points that Congress will be hard pressed to ignore even though I don't like Micron. From an economic theory point of view this will be a battle between the monetarist-Milton Friedman who feel you can inflate away problems and the Austrians-Mises,Hayek et.al. who believe every inflationary boom ends in a deflationary bust. The monetarist feel the monetary mistakes after the crash caused the depression where as the Austrians feel the inflationary expansion of credit created the boom which is complemented by an inevitable bust. BTW I am a fan of the Austrian school so i am not very optimistic about the future. Can the Dow hit 9000 or 10000 why not but someday look out below. I do feel this will be a memorable year. Mike

To: Tommaso who wrote (13959)	2/10/1998 8:28:00 PM
From: Bonnie Bear	Read Replies (1) \| Respond to of 18056

Tommaso: I pulled up a chart from a fund that holds 30-year zero-coupon bonds. Bingo, it lays perfectly on top of the S&P for the last 10 years. Guess I'm a slow learner, I didn't realize this was the way the stock valuation models were programmed into the computers. So the expansion can continue as long as the feds continue to lower interest rates gradually and nobody minds paying for the future discounted 30 years ahead in the price of the stocks. If this is the game then corporate bonds, even here around 6%, are the place to be. what happens when we run out of room to drop interest rates? Do like Japan did to us.....find another country with high interest rates and borrow cheap to invest abroad...force down their interest rates to get the stock market to go up... the cycle continues... so US corporate bonds and international stocks may be the place to be.