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"Time" was the
approach that Japan took.......
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style="PADDING-LEFT: 5px; MARGIN-LEFT: 5px; BORDER-LEFT: #0000ff 2px solid">
<FONT face=Tahoma
size=2>-----Original Message-----From: Bob Heisler
[mailto:BHEISLER@xxxxxxxxx]Sent: Wednesday, August 21, 2002 5:51
PMTo: realtraders@xxxxxxxxxxxxxxxSubject: Re: Re[2]:
[RT] GEN: DEFLATION AND GOLD....
Thanks Jim.
I get tired of these guys trashing people in
positions they no nothing about...that's the media's
job....hehehe.
And you're right, things are not as bad as one
might think and actually I'm surprised they're not worse than they are.
Sure, we could use some pro-growth measures which will be proposed next week
(if you believe the media), but the best cure for this post-bubble hangover is
simply Time.
Bob
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----- Original Message -----
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
Jim Johnson
To: <A
title=realtraders@xxxxxxxxxxxxxxx
href="mailto:realtraders@xxxxxxxxxxxxxxx";>Bob Heisler
Sent: Wednesday, August 21, 2002 7:27
AM
Subject: Re[2]: [RT] GEN: DEFLATION AND
GOLD....
Hello Bob,Amen. And let's consider for the
moment that the economy is simplynot in bad shape on a historical
basis--look at some econ charts ofemployment, hourly wages, inflation,
production/utilization. Lookback more than 2-3 years and you'll
see things are pretty good. Lookat almost any country on earth at
any time in history and the compslook pretty good. Besides being
the richest and most comfortablepeople in history, they are also the
most spoiled.Gotta go, time to put the flag up.Best
regards,Jim
Johnson
mailto:jejohn@xxxxxxxxxxx-- Wednesday, August 21, 2002, 6:52:56
AM, you wrote:BH> I'm just a lowly trader who is not an economist
or a CNBC talking head and am therefore grossly under-qualified to either
give advice on economic/fiscal policy or criticize/praise the
currentBH> economic team.BH> But what I do know is that
the current administration inherited a post-bubble economy and a post-bubble
bear market (the NDX was 45% off its all-time high when Bush took
office). Toss in 911 andBH> even someone as under-qualified as
myself can see that their timing could have been better....like inheriting a
recovery and the early stages of the PC revolution in the early
90's.BH> I hear a lot of bashing of these folks but I hear
nothing from the critics on what we should be doing - except raising taxes
and increasing government spending/entitlements. Even the
infamousBH> Lord Rubin, who bravely fled to Singapore once the Enron
news came out, has offered only these solutions. But if history is to
be our guide then that type of policy is exactly what we shouldn'tBH>
adapt.BH> What I'd like to hear from the critics are some
concrete ideas on what should be done as opposed to the daily/hourly
criticisms and negative sound bites. And those ideas should include a
plan onBH> how to get any new policy changes through the Congress
(particularly the Senate).BH> I look forward to being
educated.BH> BobBH> ----- Original Message
----- BH> From: M. Simms BH> To:
realtraders@xxxxxxxxxxxxxxx BH> Sent: Tuesday, August 20,
2002 10:27 PMBH> Subject: RE: [RT] GEN: DEFLATION AND
GOLD....BH> In the inflationary depression
scenario, it would be the best and only medicine....;BH>
however, in the second, it could be a disaster if done over a short period
of time (1-3 years), since the largest growth industry right now is the US
government... and attempts to cut-backBH> staff would only lead to
more unemployment and a lower tax base.BH> Once the big
government train is rolling, it's gotta be first slowed-down, so that
private industry can respond properly, and that will take a long period of
time (3-6 years).BH> Funny, on CNBC tonite, they had
a quote from the editor of Fortune who is calling Bush's economic advisors
the Keystone Kops !!!BH> Unquestionably, near the
anniversary of 9-11, the economic future of the country hangs "in the
balance".....recent articles suggest that NYC's economy is STILL in shambles
with many bankruptBH> vendors and small businesses, etc. Some
financial firms who lost 20-50% of their staff, STILL HAVEN'T REHIRED
replacements !!! BH> The Fed's decision on Sept 24th
looms large and should be a HUGE event....BH> watch how
the stock market anticipates their action over the next 4
weeks....BH> As always, buy the rumor, sell the
news.BH> -----Original
Message-----BH> From: Charles Meyer
[mailto:chaze@xxxxxxxx]BH> Sent: Tuesday,
August 20, 2002 7:38 PMBH> To:
realtraders@xxxxxxxxxxxxxxxBH> Subject: Re:
[RT] GEN: DEFLATION AND GOLD....BH>
Simms-BH> Yes; I'm back with another
question.<g> OK; now let me please ask this.
WouldBH> the cure for EITHER scenerio
(inflationary depression or deflationary
depression)BH> be to dramatically cut both
taxes and spending? Or; would the cure be different
forBH> each potential scenerio? I can't
see ANY of these politicians taking steps to do either. Tks for your
patience.BH>
chasBH> ----- Original Message
----- BH> From: M. Simms
BH> To:
realtraders@xxxxxxxxxxxxxxx BH>
Sent: Tuesday, August 20, 2002 1:37
AMBH> Subject: RE: [RT] GEN:
DEFLATION AND GOLD....BH>
The first would occur only if actions to stop the second one
fail.BH> Tell-tale signs of
the second:BH> 1) steepening
yield curveBH> 2) widening
corporate vs. treasury bond
spreadBH> 3) CRB index
decliningBH> 4) real estate
prices stall, then reverseBH> 5)
falling equity pricesBH> 6)
increased bankruptcy
levelsBH>
-----Original
Message-----BH> From:
Charles Meyer
[mailto:chaze@xxxxxxxx]BH>
Sent: Monday, August 19, 2002 1:43
PMBH> To:
realtraders@xxxxxxxxxxxxxxxBH>
Subject: Re: [RT] GEN: DEFLATION AND
GOLD....BH>
Simms-BH> You
wrote that: "once that ball gets rolling, the government
has no choice except to pull an "Argentina" and massively reflate...if they
can do so in time. If they can't, wham,BH> depression
occurs..."BH> Is
the scenerio then EITHER inflationary depression OR deflationary
depression;BH>
assuming things got out of
hand?BH>
chasBH>
----- Original Message -----
BH> From:
M. Simms
BH> To:
realtraders@xxxxxxxxxxxxxxx
BH> Sent:
Monday, August 19, 2002 12:27
PMBH>
Subject: RE: [RT] GEN: DEFLATION AND
GOLD....BH>
DEPRESSION and DEFLATION not EXACTLY the
same......BH>
yes, in a depression, real assets worth nothing, and the US dollar worth
little, so gold shines....can't be printed, can't be
forged.....BH>
BUT With a slower evolving deflationary scenario, all assets groups
decline......pricing power is
gone.BH>
This is why everyone is watching the housing market so
carefully.....BH>
as once THAT market begins to decline, then we are really in trouble and a
depression becomes likely since mortgage holders (banks, etc) begin to
foreclose on properties whose value isBH> less than the principal on
the mortgage
due.BH>
Once that ball gets rolling, the government has no choice except to pull an
"Argentina" and massively reflate.....if they can do so in
time.BH>
If they can't, wham, depression
occurs....BH>
if they do catch it in time, then massive inflation results with mortgage
holders and other creditors, the big
losers.BH>
-----Original
Message-----BH>
From: Charles Meyer
[mailto:chaze@xxxxxxxx]BH>
Sent: Monday, August 19, 2002 11:39
AMBH>
To: REAL
TRADERSBH>
Subject: [RT] GEN: DEFLATION AND
GOLD....BH>
Group-BH>
Excerpt below from interview which references price of HM during the great
depression. I wanted to know Pretcher's logic for expecting the
opposite in the event of a deflation thisBH> time around.
BH>
chasBH>
==========================================================BH>
TAYLOR: Well, I have had some experience in analyzing gold shares in all
sorts of markets. Homestake Mining shared with me their daily share prices
dating all the way back to 1888BH> through 1998. During the
depression, Homestake Shares appreciated very greatly despite the fact that
we experienced deflation rather than
inflation.BH>
BATRA: Did the price of Homestake rise right from the beginning
or...BH>
TAYLOR: No, actually Homestake's share price initially fell too from $83.50
just before the crash to $65 about two weeks after the crash. So perhaps the
law of substitution didBH> initially apply. But from November 15th
and thereafter, Homestake's shares rose dramatically, to a high of over $500
by 1936. And during 1932, when the DJIA had lost 90%, Homestake's shares
hadBH> reached $162. So investors who diversified their portfolios
with a little Homestake were able to travel through the Great Depression
relatively unscathed, while those who owned only the Dow JonesBH>
Industrials, were
devastated.BH>
BATRA: Ok, what I am saying is that timing is important. Gold stocks are
also going to do very well. However, at this stage, my advice is to start
preparing yourself by buying goldBH> bullion. Then begin buying gold
shares the moment there is a whiff of inflation or when the market begins to
favor
them.BH>
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