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

To: donald sew who wrote (15505)	6/1/1999 5:48:00 PM
From: Sonny Blue	Respond to of 99985

>>look at the commodity charts they are really not confirming inflation yet. << What everyone is looking at is NOT commodity prices. Inflation can rise even with gold price is going lower. Have you checked the housing market lately? How about the job market? US is a service economy. 2/3 of our GDP comes from consumer spending. (And US consumers don't buy gold) The problem with this is that the rise in inflation in this kind of economy could be very subtle and hidden until it's too late to revert. Housing prices don't go down on a blink. Employers can't cut wages fast enough. And what's about the medical costs? Babyboomers are getting older everyday! Inflation, imho, will never go away. We always demand more than what the economy can supply.

To: donald sew who wrote (15505)	6/1/1999 6:24:00 PM
From: pater tenebrarum	Respond to of 99985

Don, it has become very hard to gauge the true inflow into equities due to the massive increase in online trading. apparently quite a bit of the money flowing out of mutual funds finds it's way back into the market via individual electronic trading accounts. this of course can only be viewed as a dangerous development, as individuals are by and large more likely to panic than institutions. another feature of this new trend is an unbelievable explosion in margin debt(to over $181 billion as per april). it follows that in case of a severe downturn this huge debt overhang will serve to exacerbate things and likely leave many people destitute. what we are witnessing is a speculative orgy that makes '29 seem tame by comparison. if this market manages another run to new highs (possible,but by no means assured) the greatest short selling opportunity of this century will present itself. i just hope for the sake of all those newbie day traders that they will have the sense to get out while the getting's good. it won't happen of course, on the contrary, when the mad scramble for the exit starts many people will get caught in it. btw, i'm not so sure that much money is leaving to be employed in foreign markets. if this were the case, i'd expect the dollar to be a lot weaker than it is. but liquidity in general is drying up, as the fed quietly puts the brakes on money supply growth. regards, hb

To: donald sew who wrote (15505)	6/1/1999 7:26:00 PM
From: Bruce Denney	Respond to of 99985

donald...re:commodity charts. When you look at these charts and see...2 dollar corn...2.50 wheat...beans headed for 3.90... copper still going lower while gold is waiting to see what investors do with a few hundred extra tons of the product...as black gold heads lower while items like sugar @4cents + reflect nonexistent demand for these items. So where is this inflation and what will it be when we see, eg, 7 dollar beans --- 5 dollar wheat and rapidly rising rates. One thing is certain when commodity prices turn---what great buying ops. The above prices are all approximate of course. Anyone have any thoughts on when we retest 10thou. BD