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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: E. Charters who wrote (21748)	10/15/1998 6:15:00 PM
From: Sergio R. Mejia	Respond to of 116764

Kaplan: "..confirmation that we are heading into a recession.." The decision by the U.S. Federal Reserve to cut both the federal funds rate and the discount rate by one quarter point apiece is final confirmation that we are heading into a recession. Historically, precious metals perform strongly entering a recession, while stocks perform very weakly. Even more importantly for gold, a rate cut on the very day that the producer price index showed higher than expected inflation means that the Fed doesn't care about inflation because a weakening economy is a more serious threat. When the Fed gives up the fight against inflation at the same time that gold is close to a major cyclical low, the upside potential for the yellow metal increases significantly. Regardless of what the Fed does or doesn't do, the true indicator toward the direction of the stock market can be found in the fashion pages of any newspaper or magazine, in which it is clear at a glance that women's dresses are much longer than they have been in many years, in some cases as low as the ankle. For example, check out page B11 of today's (Thursday, October 15, 1998) New York Times, and compare it with anything from last year. For those of you who are not familiar with the dress length indicator (really, I am not making this up), longer lengths are bearish for equities; shorter lengths are bullish. 1974 marks the last time that women's dress lengths increased as much as they have in 1998. Plus, one should not forget the super-accurate Super Bowl indicator; an original AFC team won (the Denver Broncos), which means that the market will end the year lower than it began. Admittedly this latter prognosticator has no logical base, which in my opinion makes it especially appropriate for the current euphoria.