To: eRM Solutions who wrote (23619 ) 8/28/1998 12:04:00 PM From: RocketMan Respond to of 50264
The companies that will be successful will be the ones with innovative concepts and solid business plan and the leadership to carry the plan out. Excellent observation, John. Personally, I think this shakeout in the blue chips is welcome and overdue. It is the overvalued large companies that are going to have the roughest time over the next few quarters. The smaller companies have already been beaten down. The survivors will be those who are innovative, who exploit niche markets, and who have a product that saves money. With international rates as high as $10 per minute, and with the money crunch, VoIP at pennies or even quarters a minute is a natural alternative. As far as Russia, MHO is that the financial crisis will be resolved, but at the expense of further democratization. I belive we will see a return to socialist or even communist control over certain segments of the economy. So the political problem is what I worry about more than the financial. In countries like this, people will usually pull their money out of the banks, but that does not mean that the wealth dries up, it just goes elsewhere, gold or whatever. One final thought. If everyone pulled out of the market and went into cash or bonds, there would be no way for the banks to pay investors any interest unless they invested the money. It is a self-correcting system. Cash might swell for a while, but eventually that cash has to go to work to earn interest. It goes into companies that are growing the economy, and as these companies prosper, the money flows back out of cash and into stocks. That is what keeps our economy in balance.