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To: Michael Olds who wrote (30153)	3/16/1999 4:18:00 PM
From: goldsnow	Respond to of 116764

IMo the following is the reason...Traders afraid of weakness/backlush Dow Hits 10,000 Milestone But Quickly Retreats 03:43 p.m Mar 16, 1999 Eastern By Richard Melville NEW YORK (Reuters) - The Dow Jones industrial average made history Tuesday as it topped the magic 10,000-point level for the first time but the excitement was short-lived and business returned to normal as the index retreated. At 3:35 p.m. EST, the Dow was up 15.26 points to 9,974.03. Traders earlier cheered on the floor of the New York Exchange as the 10,000 number was reached but not all on Wall Street greeted the passage as a bullish event. At its early morning peak, it gained 41.35 points to 10,001.12, climaxing an unprecedented 4-1/2-year show of force in which the Dow soared 6,000 points. But some analysts have viewed the market's latest surge, which has tended to be focused in well-known large stocks, as masking an underlying weakness. ''Dow 10,000 may bring tears of joy to the market, but it will be followed by tears of sadness because this market is so narrow,'' said Roy Blumberg, chief investment strategist at Chestnut Investment Group/Allied Securities. And analysts cautioned that many investors not get wrapped up in the excitement of breaking the milestone. ''I don't think individual investors should put an emphasis on the Dow 10,000 -- even though it is historic,'' said Ron Doran, director of institutional trading at C.L. King and Associates. ''Stocks are still the place to put your money, but the short term looks a little overdone on the plus side.'' The blue-chip index's rise to 10,000 shortly after the opening capped a run that was fanned for years by an ideal economic climate, low interest rates and the lowest inflation in decades. At least one influential market watcher believes the market has a long way to go before reaching its ceiling. ''We're in a new bull market. This could be the start of a 'mega-market' lasting 12 to 15 years, similar to the boom markets that followed the First and Second World Wars,'' said Prudential Securities chief technical analyst Ralph Acampora. The bulls have been at the wheel of the market, which many Wall Streeters have described as the ''Greatest Bull Market Ever.'' Favorable earnings news helped the Dow hit the historic mark Tuesday. Union Carbide Corp. led the blue-chip average higher, rallying 1-1/4 points to 44-3/4 after the chemicals giant said its first-quarter earnings would on the high end Wall Street expectations. The Dow had been explosive this decade, breaching 9,000 in April of last year, but it stalled and later entered a severe decline as worries over the spread of a global economic crisis reached a fever pitch. But after a head-spinning drop below 7,500 in September and then again in October, the market proved its resilience, surging to 10,000 in a little over five months. The dramatic rise was helped in part by the Federal Reserve's move late last year to cut interest rates three times in a bid to keep the super-charged U.S. economy from being dragged down by the economic crisis in Asia, Russia and Latin America. Stocks have been rejoicing because the economy has expanded at a record pace and corporate earnings have defied the economic law of gravity, more than doubling in the past decade. The economic news is still rosy, even after all these years. Tuesday, the Commerce Department reported that builders broke ground on new U.S. single-family homes at the fastest pace in more than 20 years in February as a booming homebuilding industry barely missed a step. Healthy corporate profits have spurred companies to invest more cash in new plants and equipment, which in turn has fueled productivity gains and created even stronger earnings. The great market story has also been fueled by an unprecedented flood of cash into stock mutual funds. Much of the credit for the super bowl economy goes to the Federal Reserve, which has maintained an accommodating monetary policy, keeping interest rates low. Among other stock market indexes, the Nasdaq composite index rose 6.48 points to 2,437.92. The Standard & Poor's 500 index was off 1.51 at 1,305.75. Copyright 1999 Reuters Limited

To: Michael Olds who wrote (30153)	3/16/1999 4:19:00 PM
From: goldsnow	Read Replies (1) \| Respond to of 116764

U.S. backs IMF gold sales, big hurdles still ahead 03:01 p.m Mar 16, 1999 Eastern By Janet Guttsman WASHINGTON (Reuters) - U.S. President Clinton Tuesday urged the International Monetary Fund to sell gold to fund new plans for debt relief, but the idea, long under the IMF spotlight, still faces big hurdles at home and abroad. Clinton, announcing $70 billion in debt relief for poor countries, many of them in Africa, proposed ''significant improvements'' to an international program of debt relief, the Heavily Indebted Poor Countries (HIPC) initiative. ''(We need) support for gold sales by the IMF to do its part, and additional contributions by us and other countries to the World Bank's trust fund to help meet the cost of this initiative,'' Clinton told a U.S.-Africa ministerial meeting as he listed a menu of proposed changes. His comments, following statements on gold sales by officials in Europe and Japan, sent the gold price spinning to a 6-1/2 week low of $283 per ounce at the London fixing, down $3.80 from London opening levels. ''Bill Clinton opened his mouth and said he thought the IMF should sell gold to relieve third world debt, and that was it,'' said one London dealer. An IMF spokesman said the IMF had not yet set a date to debate selling some of its 103 million ounce stockpile of the precious metal, worth some $29 billion at current prices. He noted that the IMF's policy-making Interim Committee had already decided to explore the possibility of selling gold, but said the U.S. Congress would have to back the plan. ''No decision has been taken and no decision on the actual timing of any sales can be taken in view of the need for the U.S. executive director to the IMF to secure congressional authorization for the sale of gold by the fund,'' he said. Other monetary sources said that, while U.S. agreement was crucial for gold sales to go ahead, other major countries would also have to back the proposal, which has in the past been fiercely opposed by Germany's inflation-conscious central bank. The German finance ministry said on Monday that Bonn would only back the idea of gold sales if the Bundesbank approved the deal, while the Bundesbank said its position had not changed. Japanese finance ministry official Harun Kuroda said the idea of IMF gold sales should be discussed ''very cautiously.'' French President Jacques Chirac said IMF gold sales might be a possibility. ''We have to find a solution to the multilateral debt for those who need it, without ruling out the sale of the IMF's gold reserves if necessary,'' he said. IMF rules say gold sales would need the backing of member countries holding 85 percent of the votes at the international lending institution, so Washington, with 18 percent of the votes, must approve the sale for a deal to go ahead. No details have been given on how much gold the IMF might sell, but speculation centers on the sale of between 5 million ounces and 10 million ounces. The money would go into a trust fund which could also help fund a program of low-interest loans for poor countries. The U.S. administration's 2000 budget includes a request to Congress to approve a request to use cash from IMF gold sales to fund HIPC, which rewards reformist debtor states by forgiving up to 80 percent of their sovereign debt. But Congress, where many lawmakers oppose the IMF, stalled for months last year on approving extra money for the fund. House members, in a bipartisan initiative last week, put forward a Debt Relief for Poverty Reduction Act which would cancel most of the debt owed by poor countries to the U.S. government and reduce debt to the IMF and the World Bank. Copyright 1999 Reuters Limited