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Strategies & Market Trends : LastShadow's Position Trading -- Ignore unavailable to you. Want to Upgrade?

To: SteveDavis who wrote (3808)	12/7/1998 8:56:00 AM
From: tom pope	Read Replies (2) \| Respond to of 43080

Steve, there is an interesting interview in this week's Barron's with Barnes of the Bank Credit Analyst which speaks to the points you raise. Briefly, he claims that the benefits of disinflation have all been used up, and that further declines in inflation would equate to deflation, which would be bearish for stocks, tho not for bonds. The Bank Credit Analyst has been bearish (and wrong) for some time, it should be said. However, the scenario he paints has been played out for some time in Japan where lower and lower interest rates have not led to a re-igniting of demand, so it's not out of the question. I agree that the problems in Japan were compounded by a tight fiscal policy which negated the effects of an easy monetary policy, so the situations are not strictly comparable.