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To: Chris who wrote (4587)	11/10/1998 9:11:00 AM
From: Gersh Avery	Read Replies (1) \| Respond to of 11051

OK Chris .. Here's a thought. AG & co. cut interest because of concern about bonds. The cash didn't go into bonds but instead went into stocks. Now that there is talk about that maybe AG & co won't cut where is the cash going to? bonds. If AG & co. want bonds to go up, short term what would be the best action for them to take to get them to move? No cut .. or even nastier .. rate increase. Of course they wouldn't raise the rates. At this time a rate cut is built into the market. If AG & co. drop the rates by .25% then it will be sell the news time. I think that to keep the stock market even would require ~.5% cut. Not likely .. bonds go up .. stocks go down (some) just for a day or two. If there is enough rumor of no cuts before the FOMC meeting then the damage will be limited and the 401k money will keep rolling in. The way to tell this will be how much the market pulls back before the FOMC party. My $.02 (and worth every penny ggg) Gersh

To: Chris who wrote (4587)	11/10/1998 2:04:00 PM
From: Gersh Avery	Read Replies (1) \| Respond to of 11051

Yes and as DJ pointed out .. There is a linkage between the saving rate and consumption of the US population and the DJIA. If you wish to get an advanced look at how the retailers are doing this Christmas season watch the stock market. If the market is going up during prime shopping season then the retailers will do well. Want to check out some real mania? Furby index now ~$75 search.ebay.com These markets resemble the former Japanese markets. The US consumer will shift over to saving as soon as the market starts to drop again. As they did during the last dip. (My money market funds right now pay 6.0%) Then when the dip and spending continue the next quarters profits are lowered which feeds more selling of stocks .. but not for now. For today each of us takes turns being the greater fool .. Gersh

To: Chris who wrote (4587)	11/11/1998 2:01:00 PM
From: John Harton	Read Replies (3) \| Respond to of 11051

To Chris: RE: Mr.G & Sector Funds Info. FWIW The following are 6 month performance ending Aug 31 98 for the top 10 and bottom 10 Fidelity sector funds. TOP Health Care -.12% Computers -.90% Retailing -3.14% Utilities -3.22% Multimedia -4.36% Medical Eq&Sys -5.30% Consumer Indust -6.85% Leisure -7.35% Business Serv. -7.63% Food & Agric. -8.03& S&P 500 -8.10% BOTTOM Paper & Forest -25.51% Industrial Material -25.80% Chemicals -26.10% Medical Delivery -26.55% Home Finance -26.84% Environmental Ser -26.97% Natural Resources -27.25% Precious Metals -38.81% Gold -41.79% Energy Service -49.55% Observations: a) The top 10 are mostly "consumer" driven. b) The bottom 10 are mostly "commodities". c) When the market tanked in August those that didn't "flee to safety" in cash, bonds, or T-bills obviously didn't like gold but did like utilities. Questions: a) If commodities are out of favor and gold is no longer a safe haven, isn't deflation a greater concern than inflation(Mr. G's main boogie man up til now)? b) If consumer spending is the main engine driving this economy, won't the 4th quarter retail sales be a prime focus for the fed? Hence IMHO.... The fed will probably cautiously(deflation fear) make one more 1/4 point drop before the end of the year but may wait til December when the first results of the late November retail sales are coming in. Timing: The market(in its irrational wisdom g) will probably react more strongly if the move comes on a "surprise" date(as it did in October) rather than following a regular fed meeting. Any end of year rally, however, would most likely be offset by fund managers dumping their "embarrassing" holdings and investors taking EOY tax losses on their losers. BWDIK etc. -John PS. THE GOOD: Happily holding INTC JAN0 LEAPS +300% THE BAD: Sadly sold INTC JAN99 at small loss last week. THE UGLY: Still holding AMAT JAN99 bot @6 now @2.