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To: goldsnow who wrote (22753)11/8/1998 3:47:00 PM
From: John Mansfield  Respond to of 116780
 
'....So where does Canelo see profits next year?

''I think the truth is somewhere in the middle, around 10 percent,'' he said. ''For earnings to keep growing 10
percent, you can have the market gaining 10 percent from here. You can sustain fair to 10 percent overvaluation in
stocks as long as you have moderate earnings.''

But the stock market will see its highs for 1999 in the first half, after which worries about year 2000 computer
problems and other issues will cause stocks to retreat, Canelo said.

biz.yahoo.com



To: goldsnow who wrote (22753)11/8/1998 6:05:00 PM
From: Bobby Yellin  Respond to of 116780
 
Subject:
Weekly Analysis -- November 9, 1998
Date:
Sun, 8 Nov 1998 15:32:06 -0600 (CST)
From:
alert@stratfor.com
To:
alert@stratfor.com

_________________________________________

Try the Asia Intelligence Update
stratfor.com
_________________________________________

Global Intelligence Update
Red Alert
November 9, 1998

1998 Elections Redefine Will Redefine U.S. Policies

The past week has demonstrated that Bill Clinton is the most
extraordinary politician of our time. He took a draw in the 1998
by-elections in which the Republicans retained control of both
houses of Congress, and managed to define it as an overwhelming
defeat for the Republicans and a major personal victory for
himself. The generally accepted consensus was that the elections
ended any chance of an impeachment of the President. As pure
icing on the cake, the elections destroyed his archenemy, Newt
Gingrich and with it, redefined the Republican Party.

The President achieved his tremendous victory by defining the
basic issue as whether having sex with Monica Lewinsky was or was
not an impeachable offense. He was actually aided in this by Ken
Starr and the Republican right wing, which in fact did regard
having sex with Monica Lewinsky as being an impeachable offense.
The issue of lying under oath became a subsidiary matter. The
really critical issue: whether the President raised funds from
Chinese and Indonesian government and commercial sources in
return for skewing U.S. foreign policy in their favor was shoved
off to another investigation where it languishes, mostly
forgotten. This was the true tail wagging the dog: Monica
Lewinsky's tail wagged a dog of an investigation.

How was this permitted to happen? The cultural conservatives in
the Republican Party simply failed to understand that the
dominant culture in the United States draws a fundamental
difference between public character and private behavior. Most
Americans were personally offended by the President's behavior,
but did not translate the private failure into something that
defined the President. Clinton understood this. He allowed his
enemies to do exactly what they wanted to do: paint Clinton as a
degenerate womanizer. He allowed them to win that battle,
knowing that he would win the war, since being a degenerate
womanizer was not an impeachable offense. Clinton sandbagged the
Republicans. The Republicans then sandbagged themselves by
permitting the elections to become a referendum not on whether
Clinton was a degenerate womanizer (that was already conceded)
but whether he should be impeached over it. They then allowed
the Democrats to define a draw as a victory, and the results sent
Gingrich packing his bags.

There are two domestic political results here. The Christian
Right sees itself as engaged in a struggle for the cultural soul
of the United States. They have just been handed an overwhelming
defeat. The culture that won this battle was the secular,
hedonist culture that holds that what people do of their own free
will behind closed doors not only is their own business, but does
not in any way effect public life. The inability of the
Christian Right to bring down a President caught literally with
his pants down will be seen as a signal that the Christian Right
simply doesn't have the power to define the important issues. If
they could not bring down Bill Clinton over admitted sexual
misconduct, they are simply not as powerful as they would like to
think they are. Their influence in the Republican Party will
diminish after this, or the Republics will slip back into
minority status.

The second political result is the effective collapse of feminism
as a political force. Feminists savaged Clarence Thomas as being
unfit for the Supreme Court because a former employee of his,
Anita Hill, provided uncorroborated testimony that on several
occasions he had asked her out on dates and that he had even made
several dirty jokes in her presence. Feminists seriously
regarded this as evidence that Thomas was unfit to sit on the
Supreme Court. Clinton was charged (with certainly at least as
much evidence as Anita Hill brought forward) with exposing
himself to an employee (Paula Jones), groping another employee
(Kathleen Willey), and having an affair with young student doing
an internship in the White House (Monica Lewinsky). Where lesser
charges were enough to mobilize feminists against Thomas, the
charges against Clinton were not seen as sufficient to demand his
resignation. In fact, feminists argued that the good Clinton
did the feminists outweighed whatever personal misconduct he
engaged in. In other word's, powerful liberals are to be held to
different standards than conservatives.

The feminists have now created the Clinton Test for sexual
harassment. Unwanted sexual advances, actual exposure of private
parts, and taking advantage of a powerful office to seduce young
women, do not constitute sexual harassment if you support the
feminist agenda. Asking employees out on dates and telling dirty
jokes in front of them does constitute sexual harassment if you
are on the feminist hit list. The utter cynicism of the
feminists will cripple the movement for a generation. No one
will take seriously NOW's calls for greater protection of women
in the workplace after their refusal to condemn Bill Clinton.

This is the interesting outcome of the elections. The two wings
of the cultural wars, the Christian Right and feminists, have
both suffered massive damage. The ability of the Christian Right
to strike fear into the hearts of politicians has been severely
diminished, certainly on a national basis. The moral and
intellectual credibility of their main opponents, the Feminist
Left has also been shattered. Thus we will make an extreme but
we think defensible statement: the cultural wars that have
defined much of the nation's politics since about 1980 are over.
Both sides have lost and have lost decisively.

If this is true, then the battles that energized the Christian
Right and the Feminist Left, but which left the center generally
uneasy and unengaged, should slowly decline in importance.
Abortion is, of course, the core issue. Issues like pornography,
on which both flanks agreed and which failed to excite the rest
of the spectrum should also decline in importance. In short, a
new political agenda should be emerging in time for 2000. What
will that agenda be?

It is increasingly clear that Bob Livingston of Louisiana will be
the next Speaker of the House of Representatives. That means
that the Republican leader of the House will be from the Deep
South, along with the Republican leader of the Senate, Trent
Lott. This is an extremely dangerous situation for the
Republicans, who have just been devastated by cultural
conservatism. But there is a reverse twist to this. Precisely
because both Livingston and Lott come from the deep south and
have strong credentials among the powerful Christian Right within
the Republican Party, they have more room for maneuver within the
Party than others might have. Moreover, both Lott and Livingston
are more creatures of Washington than the South by now, and we
should remember that Washington won this election. They will be
able to define a new agenda without alienating the Christian
Right. They can lighten up on family values if they have another
issue that the Christian Right resonates to but that has broader
appeal.

That issue is economic nationalism. Bob Livingston was the key
figure in the recent debate over an $18 billion payment to the
IMF for use in addressing the global economic crisis. While some
in the Party wanted to block the payment altogether and while the
President was simply in favor of it, Livingston crafted a
solution which permitted the money to be paid if the IMF
underwent massive reforms that would actually change its very
nature. Rather than supporting proposals for increased power to
the IMF bureaucracy, Livingston crafted legislation that both
supported the IMF while decreasing its power. He forced Clinton
into accepting what was, when viewed carefully, a very radical
piece of legislation. Given the new proposals being floated for
$80 billion bailouts and the creation of a larger, more powerful
bureaucracy to control international currency controls, proposals
almost but not quite creating a global central bank, Livingston
has already shown himself to be a powerful opponent to Clinton
and Rubin.

It is interesting to note that issues like the power of the IMF
are increasingly motivating the Christian Right as much as
cultural issues. There is a deep and growing distrust on the
part of the Christian Right of the trend toward multilateral
solutions, like NAFTA, IMF, UN, WTO and so on, that the Democrats
are so fond of. What is most important, is that this sense of
unease is not unique to the Christian Right. Dick Gephardt
represents a serious faction within the Democratic Party that is
equally dubious about what is seen as a transfer of power from
the United States Government to multilateral organizations.

Now, the most important issue facing Congress when it returns
will be the future of the international financial system founded
at Bretton Woods. There are proposals being made to dramatically
increase the power of organizations like the IMF and World Bank,
transferring regulatory powers over world financial markets into
their hands. These proposals are being made by France, Germany
and Japan. The Clinton administration has recently appeared to
be increasingly in favor of these changes. These proposals will
rip Washington apart. They may well be supported by major banks
looking for a way out of the crisis. Free traders who have
tended to line up with the banks, like Jim Leach who chairs the
House Banking committee, will be torn between his ideological
loyalties and his institutional proclivities. Labor Democrats
like Gephardt will be opposed to any such institutional shift.
The Christian Right will be utterly opposed. Corporate
Republicans will tend to favor the proposals. In short, there
will be chaos.

With the cultural wars at an end, the new defining issue in the
United States will be economic nationalism versus
internationalism. This is an issue that cuts between parties.
Pat Buchanan and Bill Gephardt are on one side, Newt Gingrich and
Bill Clinton are on the other. But Newt Gingrich is gone. Pat
Buchanan is a pale reflection of his old self. In fact, both
parties are up for grabs. It is not clear which party will
become the party of economic nationalism. However, the dynamics
surrounding Bob Livingston's elevation to power seem to indicate
that he will take the mantle of economic nationalism and run with
it. It will protect his Christian Conservative flank while
allowing him to define the difference between Republicans and
Democrats. Livingston could turn out to be a pivotal figure in
American history.

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