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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Ramsey Su who wrote (7651)	3/6/1999 10:45:00 AM
From: HairBall	Respond to of 99985

Ramsey Su: Nice post and "anything" that effects the Markets direction is on topic. This thread is for both FA and TA. Of course, most that post here often contribute their TA reads, but FA is just as important. I am primarily a technical analyst, but may I offer a bit of fundamentals as I see it. Keep in mind, that eventually Japan may well begin to raise interest rates to attract capital invested overseas, back home. This will be done to support their efforts to repair the Japanese ailing banking system. This I believe may be the catalyst that eventually provokes rates to rise around the world as vast amounts of Japanese wealth invested overseas becomes a battleground. I suspect Europe and the US will try to retain the Japanese investment capital by raising rates as well. I suspect currency valuation will play a pivotal part in this as well. Keep in mind, that I rarely do fundamental analysis, so you get what you pay for here…<g> BWDIK as always... Regards, LG

To: Ramsey Su who wrote (7651)	3/6/1999 11:22:00 AM
From: Casaubon	Read Replies (1) \| Respond to of 99985

I recently read an interesting article concerning drastic measures to prime sagging economies. It invoked the use of negative interest rates to prime the economic pump (in essence gauaranteeing a positive return on borrowing money). Japan is very close to employing such a technique. Since real interest=interest rate - inflation rate, if the inflation rate is negative (ie deflation) Japan could theoretically lower the interest rate to keep up with deflation. The low interest rates keep the yen week and allow the Japanese to "sell their way out of crisis" by creating very large foreign trade surpluses. This is what is causing the most pressure in the world, and the chinese yuan is getting beat up because of it. Any prolonged exposure to these interest rates and the chinese will be forced to devalue. If the rest of the world devalues at the same rate we inflate, the economy can walk a long way with metastable interests rates. We are propping up other countries economies with our rapid expansion. And their deflation is allowing our expansion to proceed relatively cheaply.

To: Ramsey Su who wrote (7651)	3/6/1999 7:14:00 PM
From: Challo Jeregy	Respond to of 99985

Ramsey - from another low IQ individual <g> re-So where is cost pushed inflation going to come from Two weeks ago, I heard that some cinemas (Loews, Sony? don't remember) are raising prices in NY area to $10 a pop. Toyota raising prices 3%. Increased air fares are being tested. Received this in the mail today - Proposed new rates for AT&T services call type 1st min addt'l min curent props'd incr current props'd incr LD .08-.20 .30 .10-.22 .06-.17 .30 .13-.24 local toll .09-.19 .20 .01-.11 .05-.15 .20 .05-.14 AT&T Operator Services pers-to-pers LD $4.90 $6.50 32.5% pers-to-pers local 3.15 4.50 43% And, don't forget, price of stamps went up Maybe time to buy T? <g> BWTHDIK Challo

To: Ramsey Su who wrote (7651)	3/7/1999 12:13:00 AM
From: X Y Zebra	Respond to of 99985

Ramsey, Very good post. A couple of comments for your consideration. Greenspan tried to use inflation and potential interest rate hikes in lieu of his infamous "irrational exuberance" speech. Why does he not just tell the truth in simple English? I will help him with his next Humty Dumty speech on capitol hill: Even if he told the truth... would the politician listen, particularly nearing election time....? There are two simple components, supply and demand. Yes I like simple things, my mind gets muddled up when we get involved in complicated stuff. Would it be possible that the only reason why stocks keep marching on up to lofty heights is pure, simple and raw demand for them.... that is from an army of currently employed wannabe retirees ? If that is the case... then what would happen when they feel that their retirement is sufficiently funded, and timely appropriate to "cash in the chips"... Someone once said that when Americans decide on something... they do it all at the same time... The exit door ? how big is it? or the better question is: at what price to exit ? Now, if you think about it... maybe (just a thought, as I would disappoint myself to no end if I ever for once, agree with a politician), the idea of opening up some of the s/s funds to the casino of Wall Street, might prove not to be such a bad idea... The perfect pyramid sca... er, no, I mean strategy. Why ? For starters, it will provide an excellent kick-start (as if it needed one), from that point on.... that is to say, never mind irrational exuberance, but rather a case of rational, and maddening euphoria. Creating a level of confidence never seen before, since... If done right, it would almost assure a continuous feed of funds that would gradually provide an ascending joy ride... notwithstanding the ever "cyclical" downturns... (I am sure there will be plenty of technicians that will find the magic patterns to come up with profitable seminars, to recognize the corresponding profit opportunities). Is it possible that once you determine a specific flow of cash, (with a degree of certainty), that you could calculate the rise of the market ? Then the guessing game would be which issues, (for some reason blue chip is beginning to look even bluer now). The punch line? That would be provided by an increase in the public participation not of the American public, as by then, the great majority would be in more of a selling mode or flat tapped out.... Rather the participation of the public from the world at large... You know the argument: "The market for the next one hundred years"... or the more accepting "last bastion of safety"... the US Dollar (and its markets)... As it has becoming more evident to the investor and plain vanilla worker of the world that investing in anything that is remotely related to the Greenback... is no doubt safer, (the greener the better). Small Wonder that Alan Greenspan has been so good for the US Economy... Saint Alan, to keep it mystic. It would provide a heaven of security against those vile tyrants who would force the devaluation of the local currencies... Does Argentina sound familiar? Particularly if they dollarize their economy... Presto! in a swift move the local politicians are forced to be a little more honest... and the locals will feel more comfortable with their savings in a hard(er) currency than their former monopoly money. In this fashion.... is it possible that the theory of the greater fool can once again prove profitable? It seems that to those who create the bubble, or are in it first, seems that it always is... leaving the holder of the bag.... to others, the greatest of the greater fools... in this instance, foreign invaders... er, no, no, I mean investors ? Do you remember the Real Estate craze of the 70's ? the key was, location, location, location.... (oh yes, and be there first) I wonder if this stock market resembles that.... if so, I guess that blue chip, blue chip, and blue chip seems to be the equivalent... (and of course, don't be the last one to hold the bag....). Just some thoughts... A case to argue in favor of free markets. I am not really looking for specific answers, merely add to the on-going confusion…. Outrageous ? not really, just consider any of the current so-called news. And to be on topic: As for market direction ? Well... I view things short term, that means sometimes is up and sometimes is down, I can not afford to be long term, as I have no idea if I will have a chair when the music stops... short term assures me that at least I could go and buy one, just in case I am “out in the cold” when the music stops, as I would have some cash left. Besides... the above theory may prove to be moonshine... but perhaps a better recipe than the on-going one. Just my opinion. Good trading to all...