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Pastimes : Ask Mohan about the Market -- Ignore unavailable to you. Want to Upgrade?

To: Crimson Ghost who wrote (16922)	11/1/1998 2:37:00 PM
From: Skeeter Bug	Read Replies (1) \| Respond to of 18056

ag's cuts may be a strategy for he bond market. we will find out. if he cuts again then bonds are what he is worried about.

To: Crimson Ghost who wrote (16922)	11/1/1998 8:39:00 PM
From: Enigma	Read Replies (1) \| Respond to of 18056

George - I absolutely disagree. I think the markets jumped because nearly every commentator suggested that the Fed were likely to continue easing a little bit at a time. Now, this may not happen for the reasons you suggest because the market has soared on expectations of cuts - and so we now have irrational exuberance X 2!!. So perhaps Greenspan can sit back and say 'well that worked, lets rest a while' And the market may still anticipate cuts, which may or may not happen. But starting soon the Y2K alarms are going to sound, and who knows what the public will feel as the frenzy builds. So the Fed will stand by with further cuts up it's sleeve. So my prognosis is stand pat or more cuts - no raised rates. I have been mulling over a comment you made (I think it was you) about the 'internal dynamics of the market' One thing is absolutely certain in life - we cannot predict the future - and this goes for markets. One can be terribly wise after the event - we're all good at that - but I wonder what the 'internal dynamics' of the market were in Oct 29, or in 1973, or in October 1987? I would hazard a guess that to most people everything seemed swimmingly terrific at those times - some worries no doubt - the traditional 'wall of worry', but probably everything was pretty great - better than the present, where we have a swirling maelstrom world wide. The internal dynamics may have been good, certainly not too many people acted prudently. I will post the 29/98 comparison page later, but it is interesting. Not that the same scenario will play itself out - but it is a cautionary picture let's say. E