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To: James Strauss who wrote (56728)	10/30/1998 12:04:00 PM
From: Stephen	Respond to of 58727

Jim, this is a balancing act. Liquidity is better than it was....and some people say not as bad was made out - and fairly specific...... besides it can return to the market in an eyeblink. If AG overplays his hand, wage inflation etc will become an issue. He also continues to add liquidity to the market and this seems to be an ongoing method to keep things afloat. As for the reason for the rate cut - I believe that it was because he wanted to avoid an imminent disaster to one or more of the financial institutions and the systemic effect that would have had on the macro-economic system. If that has now been averted, there is no reason to cut rates further, especially as he needs to do a balancing act with the $ exchange rate, and the foreign investment in the US market. Course, he doesn't want the markets to tank - but he doesn't want to fuel irrational exuberance either. How big a fall would not making a tax rate cut promote ??. How much would it fuel a rally - if its built into the market and he feels he has to make the cut because its expected ... then we are all in trouble ...... Anyway ... we'll see ... Good luck all

To: James Strauss who wrote (56728)	10/30/1998 12:29:00 PM
From: donald sew	Read Replies (2) \| Respond to of 58727

Jim, The pullback next, that I am expecting, should be small, and the following upswing which should start by the end of next week, could be extremely strong. If it is too strong and we get close to 9000, I believe the chances that the FEDs will reduce rates on NOV 17. The probability of the market rising 400-600 points after next weeks pullback is increasing. I think next week's pullback has maximum downside of 8300 on the DOW, if it even gets that low. I feel more comfortable with 8400-8500, then add 400-600 points to that. Next week will be a good time to go long. If we do get to the 8800-9000 the NEW HIGHs better get to the 150-250 range, or there will be a strong selloff if the FEDs do not reduce rates. Again I am not saying a break of 7400, just sticking to my range trading trend. I feel that the trading range could become 9000-8000. Seeya

To: James Strauss who wrote (56728)	10/30/1998 1:06:00 PM
From: Trey McAtee	Read Replies (2) \| Respond to of 58727

james-- ok, but what happens when the fed continues to lower, people dont stablize the situation and we go into real inflation since all this liquidity is not going to be put to work effectively but is instead going to fuel new speculation? what i am looking at is an economy that just wont get marginally more effiecient with new money. so, the money goes into speculation, which is going to cause even more massive asset inflation. so what happens when the fed wants to defuse the bubble? look, i like up markets...i like the bull...but this isnt about negativity anymore. its time to pull in the reins a bit and wait for things to settle overseas. THATS the best course. however, it looks to me like the smart guys are going to prop us up until we cant be propped up anymore. what will happen then? good luck to all, trey