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> Stewart, the chart may not look very good right now, but what about the
> fundamentals? As Robert pointed out, Fed rate cuts will be bullish, but
> here's two other things to consider. The federal government has gone from
> running $300+ billion annual deficits to de facto surpluses in just a few
> years. You can't just look at demand, you have to look at supply as well,
> and that's an enormous contraction in a short period of time. The other
If the economy slows down as it is now forecasted, Federal tax revenues will
likely come up short. In making their forecast, the politicos in D.C. have
assumed that the business cycle is dead. It's not. Also there won't be the
capital gains tax money rolling in either. And don't forget the Japanese,
they could conceivably repatriate some of their money (sell Treasuries) to
shore up their battered system.
Just my $.02 worth.
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