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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: William H Huebl who wrote (37241)	2/7/1999 11:53:00 AM
From: Bonnie Bear	Read Replies (1) \| Respond to of 94695

Bill: look at the chart of the Nikkei. The virtuous cycle follows Greenspan's career...and that of most of the brokerages. Where has the money gone? where were the really big bubbles? Let us look... About the time Greenspan got into the gov in 1974, interest rates were jacked up and money to pay for it was taken out of defense contractors..resulted in massive unemployment of highly-paid people, cheap real estate, cheap stocks. "The club" bought stocks, gold and real estate at rock-bottom prices....got fear and greed to run up the prices, and inflation was the excuse to run interest rates up to 15%.. in 1982 "the club".sold commodities, bought bonds... in 86 .ran up bonds to 8%. in 86..dumped the profits into the Nikkei... ran up the Nikkei until the end of 1990... in 1989-90, ran the profits back into US bonds, now back at 10%.... ran bonds up to 5-6% in 93.. .dumped the profits into asian markets, real estate and gold in 1993... sold in 1994, brought the money back to the US and ran the bond market from 8% down to 5% somewhere, around 1990, corporations took on loads of debt so they could play along with the game, their pension plans model highly-leveraged stocks like they were bonds...great stuff for executive compensation. .... To get back to 1990, you can see that "the club" got a great deal selling the Nikkei at 39,000 and buying US bonds at 9-10%...curious how a 30-year bond shows up at the right time... So, I'd assume that this last huge runup in the Nikkei in 89-90 resulted in a huge bubble in the bond market...there should be an echo of it in the bond market as 10-year bonds held to maturity come due..one wonders what they bought, 10- and 15-year bonds? There should be a pattern in the 89-90 bond market showing what issues were bought, and likely held to maturity..and there should be an echo in our stock and bond market as those issues are redeemed at maturity and the money carted off. October 7 is an echo of the 1990 bond market, isn't it? Looking at the chart of the Nikkei, one might think the party could continue through the end of December, then crash Jan 1 2000 The devil is in the bond market..stocks just go along for the ride. This business of 5% down for bonds has been going on a long time. Interest rates can't come back up, because the world will default. The other question is about where the bubble will move, and when...a trillion dollars are parked in the internet twenty-minute-parking zone. Clearly, this fed has a history of inflating us out of the national debt.. Somebody has parked it there waiting for an "event"...perhaps a final crash of the nikkei, devaluation of the yuan, exhaustion gapdown in gold. they had to stick to large-cap stocks, or massively liquid stocks, to get the money out in a hurry.. I guess my gut tells me if these guys have been at it for 25 years they will continue their virtous cycle, they will buy what is cheap when they have engineered a bottom. And my gut tells me to look at those things at 25-year lows very skeptically, as things held there by derivatives contracts and not on fundamentals.