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At 05:05 PM 6/10/98 -0400, John Stevenson wrote:
>I refer to the Jerry Favors analysis as stated last friday (5 June) on
>CNBC. I think I heard him say that the mkt needed a week of big volume, and
>needed to set new highs above the mid-May intraday high of 9312 or else. .
>.that mid-May high would represent the "final top" of the astounding Bull
>mkt we've witnessed for the past 2-3 years, and that a plunge would occur
>within 107 +/- 5 calendar days from that top. I think it's safe to say that
>the rally isn't happening.
>
>1. Do you believe in the so-called "New Paradigm"?
>
Haven't heard of that one.
>2. What happens, based on historical empiricism, when prices rise, and
>earnings fall?
>
But right now earnings are starting to rise and prices have been falling.
>3. If the "fundamentals" of the Economy can be reduced to "a low rate of
>inflation" (as Bulls want us to believe), what about the other
>"fundamentals" that tell a radically different story? (ie: balance of
>trade, mkt internals, shrinking profits, chaos in foreign mkts, blazing GDP
>growth. . .etc.)
>
Our balance of trade should not be expected to be even-steven as long as we
are the leader in productivity and per capita earnings and wealth. Our strong
dollars will continue to flow strongly to bring in products that are
cheaper from other countries.
>4. Does laying off 1000's of workers really constitute an "increase in
>productivity", or merely a short term boost to the bottom line (and the
>stock price), to be inevitably followed at some indeterminate time by an
>erosion of product and/or service quality? Is erosion of quality deferred
>inflation?
>
This socialist line does not have any bearing on our investment objectives.
The quality will just have to be achieved at a lower cost.
The 1000's of people laid off may have to take jobs paying a little less
unless they come up to today's level of technology. Things are changing too
fast to count on a one-career life!
>5. Do the PPI and CPI really measure inflation (defining same as: an
>erosion of purchasing power due to an expansion of the money supply), or
>have they become easily manipulated tickets to popularity for politicians,
>and sales tools for Mutual Funds?
>
More socialist *bs*
The PPI and CPI should be challenged in a more meaningful way. Would you
please get specific as to what has been causing purchasing power to erode?
Would you please get specific as to what is the right amount of money supply
increase.
>
>John D.Stevenson
>
Let's hear more from you.
Pete Namtvedt
petena9090@xxxxxxxxxxxxxx
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