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

To: Howard Henick who wrote (43461)	1/15/1999 12:21:00 AM
From: Mike M2	Read Replies (2) \| Respond to of 132070

Howard, just yesterday you said the world economy is stable and the problems in Brazil solved #reply-7251406 hohoho Many of the bears on this thread see deflation due to excess capacity and debt. The global credit bubble has burst and AG cannot prevent the bust from playing out. Mike

To: Howard Henick who wrote (43461)	1/15/1999 8:51:00 AM
From: Earlie	Respond to of 132070

Howard: I'm not an economist, and I recall calling for a depression rather than the demise of the economy, a forecast I'll happily stand by. I've never commented in any consequential way about commodities, except to note that they are at historic lows which is both a fact and a classic sign of an approaching depression. Perhaps that part of your note was a generic rather than specific reference. I do agree with you that I've been bearish for close to 3 years now. That bearishness initially related to falling demand and rising supply that I observed in several tech niches, particularly the semi/PC arena. It increased as I watched what previously had been acceptable accounting across the sector, become a gross charade and a scam not recognized by the investing public. It increased further when I witnessed the PEs rising as earnings growth (even those distorted by annual "one-time-only" restructuring charges and massive "R&D writedowns"etc.) began to taper off, then fall. And it has been reinforced by the greatest insider selling exodus since the depression. None of us want a deflationary catharsis, and I did not expect to live through one (although the borrowing binge of this last 15 years suggested that my kids would) but we will, and soon. In fact, I'll happily bookmark your comments and I'll even more cheerfully eat humble crow on this thread if proven wrong,...something by the way that I've had to do in the past. (g) Aside from the fact that many of the basic statistics emanating from the U.S. suggest a "slowing", other far more potent signs also speak to it. I'd love to hear your views on November's bond market lock-up as an example. I'll take the comments about Abelson as a compliment as he is a darned good writer and also conducts decent journalistic research. "Don't fight the Fed" is a well-worn belief in the markets, and most of the time it is good advice. It is the opposite when the Fed runs out of room, which to this observer is exactly what is happening. No need to review the trade imbalance, the current account deficit, the global U.S. treasury swamp, the depression spreading rapidly from country to country, as these are facts that cannot be denied. Dare I mention the Euro, which to my mind has fundamentally changed the way in which the world can respond to N. American profligacy. Your note is deadly accurate with respect to who is making the dough in this current market. It certainly isn't the bears. That said, if a depression does come ashore, few of the current market's bullish participants will escape with a dime. Incidentally, in normal markets, bears do rather well. While the investing public doesn't seem to be aware of it, the vast majority of junior tech stocks that make it to the publicly traded markets, flop. They create great rides up on the hype and the hope, and equally great rides down as the negative cash flows re-establish reality. It's a two-way street. I would also reiterate that I've raised rather large amounts of money over the years for a decent pile of junior tech companies, which suggests that I'm either an eternal optimist or inclined to masochism. (g) I've bookmarked your entry. (g) Best, Earlie

To: Howard Henick who wrote (43461)	1/15/1999 8:54:00 AM
From: Mike M2	Respond to of 132070

howard, in SEA liquidity disappeared without any central bank tightening. In Russia liquidity disappeared very quickly -ask any hedge fund manager-g- . In the US note how credit spreads have widened- a sign of more trouble to come- Mike