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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: Frodo Baxter who wrote (4435)	6/12/1998 6:29:00 AM
From: MikeM54321	Read Replies (3) \| Respond to of 9980

Lawrence, Glad to see someone with a bullish sentiment on this thread. Keep your post coming even though they, "smart" at times. Contrary views forces one to re-evaluate. Can't argue with your analysis of what we can do with "our" (assmming you are in the US) economy. I think most are not that concerned with what we can do even if all the smaller SEA nations tanked. I think most are focused on Japan and then China/Hong Kong. Greenspan actions here, have little to no consequence on what will happen to the US equities markets if those major economic powers were to get into severe trouble. If you have been reading all the "Asia Warnings," it's hard to argue our strong economic connections. That being so, let's say it's at a low end that our goods find there way over to their shores, can we live without it? Maybe. But how can we deal with the imports? Tougher question. How does our overinflated equities market, selling at a PE of 24 plus, deal with it? They dealt with 1.5% and under growth in 1Q98 pretty well. But that was supposed to be, "Oh don't worry. Q1 is the bottom. Q2 we will pull up and out of it." But what happens if Q2 doesn't? What about Q3? At some point, wouldn't you say, our markets have to adjust to a substantially lower level of growth than they were used to? If so, that mighty high PE of 24 is going to take a serious hit. I certainly didn't say anything about "some kind of 1929-style" depression. Quite a few writers have whose articles we have read, and posted, have. I don't believe there are too many that post on this thread, that think, to believe what is coming will be that severe. I feel like my main lessons learned from all the past few months of being involved in this thread, is to treat these problems with lots of respect. They are more severe than the Wall Street professionals and the main stream press would lead us to believe. Watch carefully. Act quickly. Don't be one of the ones to pile on blindly, into our equities markets. Wait and let the dust settle. The problems are real and don't listen to the professionals who say, "this is the bottom," time and time again. Thanks, MikeM(From Florida)

To: Frodo Baxter who wrote (4435)	6/12/1998 9:58:00 AM
From: Sam	Read Replies (1) \| Respond to of 9980

Larry, "Now I know some of you of particularly ursine proclivities thinks is the beginning of some kind of 1929-style depressionary spiral. But you have yet to make a case for why the Fed doesn't have enough maneuvering room to avert this nonsensical and implausible nightmare." I agree with you about the problem--that deflation is currently a greater threat than inflation. I also think that deflation is harder to fix than inflation. But I think that the Fed--and a lot of economists out there as well--are still fighting the last battle; that is, against inflation. They see it as more likely than deflation, especially with the tighter labor market. Don't forget that labor is a much higher percentage of the cost of most things than materials.