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To: Gersh Avery who wrote (4592)11/11/1998 11:54:00 AM
From: smolejv@gmx.net  Read Replies (1) | Respond to of 11051
 
>>The US consumer will shift over to saving as soon as the market starts to drop again <<

I think the dog in this story is the US consumer, wagging the world economy tail. It will be the change in the consumer behaviour that will cause the market drop, not the other way around. Anyway, I think we are in for a great Xmas party. Buy ToyzRus.

BTW, my story on the interest rate is not 100% kosher - like fed dropping the rate to pump up the cash and the demand. Forgot to factor in

a) the influence on the foreign fund net flows (causing them flow even less in the bonds and even more so into the market). aka influence on foreign capital inflows.

b) the influence on the exchange rate and on the current deficit.
aka influence on US$ outflows.

I still think the US consumer is the biggest economy entity worldwide. All the rest is derivatives on this item.

dj

PS: darn it, where's my tongue, anybody seen my tongue?...