Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: jeffbas who wrote (7293)	5/24/1999 1:48:00 AM
From: Don Earl	Respond to of 78522

Hi Jeffrey, The potential impact of higher rates is more likely to affect foreign exchange rates and the cost of US goods over seas than borrowing costs. If the Fed tightens, 135+ yen to the dollar is almost certain and we're back where we were last fall. For companies that depend on exports, it's either lower sales or lower margins. There's also the "flight to safety" effect where money tends to shift out of stocks and into bonds. My guess would be around a 15% correction in the Dow and a blood bath in techs. I tend to get sort of bearish when the Dow is at near record levels and all the ANALysts are saying a tightening bias by the Fed is no big deal. It's been my experience that the best way to tell if an ANALyst is lying is you can see their lips moving. Regards, Don