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To: RGinPG who wrote (4363)	10/16/1998 5:55:00 PM
From: Lucretius	Read Replies (3) \| Respond to of 14427

LOL!! bear mkt is over, eh? Most won't even call it a bear mkt yet (they like the word "correction"). Sorry, I think we're just getting started. A shake out move like this always happens before a big fall. Shorts panic and cover, greedy longs trip over themselves to chase stocks that are still too expensive by any means of computation because they are fearful of "missing out." I've been waiting for the Fed to make this move. it scares bears and makes bulls greedy, but it doesn't change the fundamentals. You say adding money by the buckets... that is simply not true... they have lowered the interest rate at which banks can receive loans who then loan that to customers. Were our previous rates too high that they were suppressing demand from borrowers?... NO... Businesses wouldn't take on debt and/or the banks couldn't/wouldn't make the loans. Every boom ends, and this one already has. When the mkt finally accepts this, there will be hell to pay. Japan cut S-T interest rates down to almost nothing and it got them nowhere (at least they are a net creditor nation so their L-T rates also fell). In '29 we cut rates and it got us nowhere. Rate cuts do not stimulate demand, they stimulate supply and we already have too much supply. Throw in a weaker dollar and repatriation by the Japanese and Europe and we get higher L-T interest rates to boot because foreigners have financed this mania for the past 15 years. When we have to start having to finance ourselves that money will come out of the stock mkt and other investment in order to hold down our national debt which grows exponentially daily. I'll be buying NE much lower than 15. -besides I like bad habits (G) -Lucretius BTW- the mkt has not priced in a recession yet (not even close) and how did I know the bear was beginning?... easy... my black mystery ball said "bear" (G)

To: RGinPG who wrote (4363)	10/16/1998 6:22:00 PM
From: waverider	Read Replies (1) \| Respond to of 14427

Oil stocks do a little rally and folks come out of the woodwork from down there. We've seen this before. Take care in making sure this isn't one more head fake...an endemic problem for the OSX. Ron, with all due respect, Luc's record on calling market moves has basically been right on since March or so. He based his opinions on fundamental changes in money flows, earnings, overseas markets, currencies, etc...not on stochastics. No system works forever, as you and many of us who followed your work found out the hard way. Yes Luc may have gone over the edge and lost his perspective, but nothing indicates that yet. Things are playing out EXACTLY as he has suggested they would. To my personal delight (and stock positions), on a day that one would think the bears would have been buried, the utilities got hammered (PE and PEG), gold has continued to move up (as have most of the stocks), banks and financials were beat up, and we tested 8425 resistance and it beat back the bull run. These are not the kinds of things the would be encouraging to the bull case. Luc's portfolio is smiling too today. The case of a runaway bull market now, as you are suggesting, does not compute with what we know about the world...especially since AG confirmed our fears with the rushed cut yesterday. The Fed cuts not because the economy is in great shape. The market will soon recognize this. Good luck, <H>