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Strategies & Market Trends : The Stock Market Bubble -- Ignore unavailable to you. Want to Upgrade?

To: Box-By-The-Riviera™ who wrote (1570)	9/8/1998 9:58:00 AM
From: yard_man	Read Replies (1) \| Respond to of 3339

I think the market is doomed with/without rate cut. Announcement was made to stem the slide or slow it. Lotsa luck -- don't buy into the bull hockey. Greenspan did not say the FRB was cutting rates, just indicated the possibility. If you read the full text of what he said you will get a different idea. This rally will be a one or two day wonder at most, IMO. FWIW, even if it is not much.

To: Box-By-The-Riviera™ who wrote (1570)	9/12/1998 12:44:00 AM
From: Larry Abrams	Respond to of 3339

Cause of Bear Markets: Then and Now Then, Bear markets caused by inflation and RISING interest rates. Financial institutions such as banks and S&Ls fails due to disintermediation as they have borrowed at short term and lent long term. Now, Bear market is caused by FALLING interest rates. REITs who have bought mortgages and then securitize them by bonds begin to fail because the return on liabilities (securitized bonds) drops below their assets (mortgages) as they are prepaid and refinanced at lower rates This dries up the mortage-backed security market causing a drying up of money for mortgages (especially on subprime mortgages) which causes a bear market in real estate and institutional failure. Any attempt by FED to lower rates will just exaserbate the coming bear market