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To: Cynic 2005 who wrote (45159)	6/4/1999 4:53:00 PM
From: Stefan	Respond to of 86076

Mohan thanks for an excellent post.

To: Cynic 2005 who wrote (45159)	6/4/1999 5:05:00 PM
From: DJessen33	Respond to of 86076

Preach, brother. Preach! DJessen33

To: Cynic 2005 who wrote (45159)	6/4/1999 5:17:00 PM
From: Ken98	Read Replies (1) \| Respond to of 86076

Mohan, excellent post. Do you get the sense that maybe it is not just the bears that think the numbers are cooked? The bond market did not seem to like them either. At what point do you thing stocks will pay attention to interest rates, if ever?

To: Cynic 2005 who wrote (45159)	6/4/1999 6:22:00 PM
From: BGR	Read Replies (1) \| Respond to of 86076

Mohan, The sole reason the US economic system has the Fed is to intervene when in their independent opinion the free market equilibrium has become hazardous for the future state of the economy. Thus, it is chartered to pump in money when the market decides to pump liquidity out and the reverse holds as well. (I am not making this up, you may check out their charter.) Last October there was a severe liquidity crisis. The Fed did an excellent job averting the damage. I salute it for that. IOW, the Fed is on the side of the economy, period. If the economy collapses, while it is OK for private individuals to claim that fornication is not affected by that phenomenon (I don't; perhaps those who do don't hold jobs in this economy, but I do), the Fed cannot say that, as it would be neglecting its job in that case. If enough big banks collapse, the economy collapses. I do not grudge LTCM a big fat bonus, not do I grudge corporate CEOs their big option packages. I have my own small one and I am happy that my economic situation has been improving by leaps and bounds during the tenure of this Fed. And that is not a Govt. statistic. I know how I am doing. If enough people feel that way (which it seems they do) they are either deluded (unlikely) or the Govt. statistics need no manipulation. Let's leave arrogance aside. It's a subjective issue. But as for feelings of invincibility, since you and I are both from India, let me ask you this: What would you rather choose, the fatalism and pessimism endemic in the Indian economy and consumers or the invincibility and optimism (which is not w/o its downside) of the US economy and consumers? It seems to me that both you and I have made our choices. As for the margin issue, the problem is one of lack of education. Today's individual investors (and that includes many many bears - realists, if you prefer - on this thread, I must add) have very little undertanding of what risk is (yes, the risks of buying options are not very different from going into margin). That has got nothing to do with when the market crashes. That has to do with brokers advicing clients about what the worst case scenerio may be. Oh, I forgot, these days nobody uses brokers anymore! Well, at least one can buy the standard finance texts and learn some. Oh, I forgot, the internet is the best education available. This, precisely, is the problem that the present day investors have (both bulls and bears) - that they are unwilling to learn the basic theories of modern finance but instead focus on the hocus pocus known as TA, follow the touts and seld-proclaimed gurus on the internet and finally make ridiculous bets based on emotion. Sorry about the rants, it was not pointed at you, I just had to vent. Coming back to the main point, you may differ with the Fed's opinion about the state of the economy, but not with its action based on the opinion. I have no comments about Bill Clinton as I am not an US ciizen (and do not plan on becoming one). In any case, the Fed is an indepedent board. As for short selling, I consider that to be a very important aspect of the market and I disagree with the uptick rule. Hey, I buy puts too. It's just that long term I am extremely optimistic about the state of the US and the world economy. -BGR.