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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Ramsey Su who wrote (35567)	11/8/1998 11:08:00 PM
From: Mike M2	Respond to of 132070

Ramsey, historicly periods of financial asset inflation are followed by deflation. The Mississippi scheme ( France 1720) and England's South Sea bubble 1720. More recently the roaring 20's bull mkt in the U.S. followed by the Great Depression. The Japanese bubble of the 80's which is still deflating and more recently the collapse of SEA. I believe we are in for a period of deflation after this current bubble bursts but many economists would disagree-notably the monetarists but I have history on my side. There are many good articles at fiendbear.com and gold-eagle.com

To: Ramsey Su who wrote (35567)	11/9/1998 11:50:00 AM
From: Knighty Tin	Respond to of 132070

Ramsey, Yes. There have been several periods like this. The most recent was Japan in the 1980s. The Nikkei could never decline because the Japanese were pouring money into it every year and they are the most consistent investors in the world. And, of course, in the 1920s, an entire generation of WWI veterans had achieved financial security and threw their dollars into bottomless pits. That expanded stock market participation tremendously. Market liquidity increased greatly in the 1960s after the forever muddling along economy of the 1950s. We know what happened in the end to all of those markets. The simple fact is, there are always reasons why this time is different on the liquidity argument. But the real story never changes. A stock market rally attracts new players. People who didn't know a stock warrant from a search warrant in the early 1980s now have most of their assets tied up in overpriced stocks or stock mutual funds. You simply cannot have a real bear market without suckering in a massive number of new players during the bear phase. MB