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

To: HairBall who wrote (11987)	4/25/1999 7:49:00 PM
From: pater tenebrarum	Read Replies (1) \| Respond to of 99985

LG, i'd like to comment on rates and the stock market moving up in unison. this is typical of a slight re-emergence of inflationary psychology. the stock market starts to focus on higher earnings (a reflection of returning pricing power in some industries)instead of rates. if this persists, the market will ultimately be in deep trouble, as rates are the far more important factor. the most glaring example of this is '87. it is still too early to determine if this is a trend or just a momentary blip right now. i agree with all who have talked about rates that they deserve a great deal of attention at this juncture. btw, according to consensus inc. the bullish consensus on t-bonds is 32%,which is historically low. from this one would assume that rates should move lower. the question is: will the stock market provide the reason by declining, or will lower rates give the market another boost? interesting weeks ahead. regards, hb