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To: bobby beara who wrote (30384)	3/21/1999 9:15:00 AM
From: Rarebird	Read Replies (1) \| Respond to of 116791

The U.S. will be immersed in Stagflation in the second half of this Year. The increasing trade deficit has brought down estimates for GDP for the coming quarter to 2.7%. GDP will fall well below 2% in the second half of the Year as the trade deficit widens even more. Inflation! Look at what crude has done just this month! The Fed will be forced to raise interest rates later this year to contain rising inflation. This would be quite bullish for Gold and the XAU. Why? The Stock Market would collapse and the dollar will follow, which will be much more bullish for gold than will be the minor bearish effect of a small rate increase, especially as few other countries are likely to follow, given high unemployment and other problems. I say again: If domestic inflation increases in the U.S. and the stock market declines significantly, then the price of gold will rise regardless of what central bankers and the IMF does. In fact, central bankers and the IMF will be under great pressure to buy rather than sell gold , due to the changed economic situation. The best of all possible environments is emerging for Gold. It is darkest at the bottom of the Killer Bear. I see a move to 120 on the XAU sometime this year.

To: bobby beara who wrote (30384)	3/21/1999 9:03:00 PM
From: goldsnow	Respond to of 116791

Bull Market Mixes Fact and Fancy Sunday, 21 March 1999 N E W Y O R K (AP) NOW THAT the Dow Jones industrial average has broken 10,000, it's more tempting than ever to regard the great bull market in stocks as a flight of fantasy, something utterly unreal. How can the assets and earning power of corporate America be worth twice as much today as they were just 3 1/2 years ago, when the Dow crossed 5,000 for the first time in the fall of 1995? Or three times as much as their market value seven years ago, when the average hovered around 3,300 in the early spring of 1992? That's not even to mention the wacky world of Internet stocks, where traders seemingly never let mundane worries like "will this business ever make a profit?" spoil a good story. "These are outright gamblers," says Ray DeVoe, an analyst at Legg Mason Wood Walker Inc., "riding a lucky streak and hopefully getting off before the plug is pulled." As they survey the whole bull-market scene on Wall Street, many observers seek to explain it by looking at the supply and demand forces that drive the stock market. Stocks are up, they conclude, because the huge generation of baby boomers born after World War II is rushing to invest, almost in a panic, before its 72 million members start reaching retirement age. In this view, once the bull market got rolling it gathered a self-propelling momentum that attracted more and more investors. Now, the skeptics say, it looks as though nothing will stop the bandwagon until something ugly happens and the wheels come off. Almost everybody in the financial world shares these concerns to some extent. By any known standard, prices of many technology stocks and a few dozen blue chips are extraordinarily high. But optimistic analysts say that doesn't make the whole bull market a fraud, or the result of some artificial increase in demand for stocks. They say the primary explanation for rising stock prices lies in powerful economic progress, marked by surging productivity and sharply reduced inflation that have helped many businesses prosper and grow. "We break with the consensus in our view of the baby-boomer inflows into the stock market," says Richard Hoey, chief economist at the Dreyfus Corp. "Rather than the demographics being the cause of the stock bull market, both the public inflows into stocks and the bull market are the effects of favorable fundamentals. "These favorable fundamentals include the decline in inflation and interest rates, the shift to budget surpluses and the superior capital efficiency in the U.S." If an aging population concerned about retirement had the power to cause a bull market by itself, Hoey adds, Japan also should have had one over the past decade, instead of the severe bear market it has suffered through. As analysts debate what is real and what isn't in the bull market, most all of them agree on one point - the "battle of Dow 10,000" does not qualify as an actual event. The latest reading of the Dow is calculated at any time by adding up the prices of its 30 component stocks, and then dividing by a divisor that is regularly adjusted for stock splits and other changes. It just happens to be around 10,000 now because of a long series of decisions, many of them arbitrary, made in years past by the people at Dow Jones & Co. who designed and oversee the average. If different stocks had been added to the average over the years, or some of the same ones now included in it had been introduced at different times, Dow 10,000 might be an old story, or a still-distant vision, by now.

To: bobby beara who wrote (30384)	3/21/1999 9:10:00 PM
From: goldsnow	Read Replies (2) \| Respond to of 116791

''The idea is $17 to $19 Brent,'' a Gulf official in Vienna said. ''By the third quarter you will see it around that level. Prices will rise when the market feels the cuts.'' OPEC To Ratify New Deal To Revive Prices 04:21 p.m Mar 21, 1999 Eastern VIENNA, Austria (Reuters) - OPEC oil ministers arrived Sunday for a meeting that will bless new output curbs aimed at reviving prices after oil's worst ever slump. Organization of Petroleum Exporting Countries members were confident no last minute snags would upset a prearranged accord on lower supply limits. ''We are finished, it is all done,'' Kuwaiti Oil Minister Sheikh Saud Nasser al-Sabah said. ''Absolutely. This time it is very clear and positive,'' Venezuelan Oil Minister Ali Rodriguez told reporters on his arrival in Vienna. ''It is concluded. There is nothing but solidarity,'' added a senior Iranian official. The deal thrashed out by five oil ministers in The Hague March 12, with the consent of others contributing, will cut output from 10 OPEC members 1.717 million barrels per day starting in April. The pact aims to restore the prices exporters were familiar with before Asia's financial crisis and oversupply sent oil markets crashing to less than $10 last year. ''The idea is $17 to $19 Brent,'' a Gulf official in Vienna said. ''By the third quarter you will see it around that level. Prices will rise when the market feels the cuts.'' Oil prices since the Hague pact have risen sharply but still remain no better than last year's $13.30 average for Brent -- a 22-year low. OPEC delegates said the duration of the new pact had still to be decided but that it was likely to be imposed for at least one year. It will reduce OPEC production to 22.976 million bpd from 24.692 million, excluding sanctions-bound Iraq. Non-OPEC Mexico, Norway and Oman together have pledged an additional 286,000 bpd of cuts. Russian Energy Minister Sergei Generalov, due in Vienna Monday, may also pledge lower exports from his country. OPEC, in control of more than half the world's oil exports, last year sliced output by 2.6 million barrels a day but it proved insufficient to ease huge stockpiles of oil. The cartel saw petroleum export revenues slump 30 percent, losing $50 billion. This time producer countries are confident they have resolved the issues that ruined last year's efforts at market intervention. They insist there will be no repeat in 1999 of the sloppy adherence by some countries with official output limits. ''There are no fears this time about compliance,'' a Gulf official who is familiar with Saudi policy said Sunday. ''Every country is willing to comply fully. They have seen the consequences when they do otherwise.'' A settlement two weeks ago between Saudi Arabia and Iran of the squabble that had blocked any earlier discussion of new oil cuts paved the way for the Hague pact. Venezuela's Rodriguez said his country, like other countries, would implement its lower production levels immediately. Meanwhile Iraq's Oil Minister Amir Mohammad Rasheed told reporters in Vienna that Iraq's oil exports might rise a little later this year but would not match last year's big jump. Oil consuming countries for the time being remain comfortably protected by a global inventory stock excess estimated as high as 500 million barrels in a world market that uses 75 million barrels daily. Copyright 1999 Reuters Limited.