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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 (2008)	10/7/1998 8:49:00 AM
From: Kip518	Read Replies (1) \| Respond to of 3339

Thanks for your thoughts.....do you think however, the falling dollar would restrain the fed from lowering rates further? No. IMO, right now fed is moving slow because it wants the market to decline and to not reinflate. However, the other consequence of the market decline is increasing credit failures and credit crunch. Ultimately, that will have to be relieved by more rate cuts. I think we're moving into the worse of all worlds for investors ... increasingly lower rates on fixed instruments, lower stock prices, and lower real estate values as well -- in other words, deflation. Of course bulls will now argue that '99 will be an improved export year with cost of goods from us companies declining vis a vis the dollar.....and even perhaps q4 of this year.... I've always found this a curious argument. What are American goods? U.S. manufacturing is increasingly done outside the U.S. and requires repatriation of costs. If the dollar is down relative to the currency of the manufacturing countries those costs increase. If third world countries where much of the manufacturing is done collapse in political chaos, then those manufacturing lines will be difficult to maintain, even if there is still a favorable currency conversion. Contrary to most people's image of America, it is largely a commodity exporter -- like emerging market countries & Canada; a debt exporter, and a "gun dealer." Of the three, given the changing political climate of the world, I would hold out "hope" only for the latter to improve U.S. world trade. Kip