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  1. zee

    34 Posts.

    Hi Bligh007 and everyone..

    >>Debt/Deflation will be the death of the US economy.
    Someone has to pay the piper.<<

    To look at this quote objectively I would have to say this is correct. However, I am more concerned about the US's $6,119,331,528,850.00 bubbly debt situation than deflation ---- debt is tangible, deflation isn't.

    There are theories the us economy will follow Japan's path. This will be correct when Greenspan implements a zero interest rate monetary policy..untill then, there are no fears of deflation.... We are heading towards that path as indicated by the federal reserves bias on a record low interest rate policy - no doubt -- however deflation fears are still pre-mature until that policy comes to fruition..

    I listen to the market in general and not specific sectors in the media world. The market is not focussed on market fundamentals such as debt, as the media composing stories of extreme negativity that has taken the market by the scruff of the neck with hardly any aknowledgement on stock specific issues nor economic issues. The media is playing the piper which is expected at this phase of the bear market..

    The market is only concerned with scandals, fraud and corruption - and who is the next victim for chapter 11 - crazy stuff.

    The corporate 'dirtbag' shake-out is more than required and welcomed with opened arms in my view.. but how far does the market want to take it ?.

    The media beat-up of corporate scandal is only healthy but it is also only a fad and investor focus will again swing to other issues.

    Like night following day, like high volatility following low volatility.. good will follow bad..

    More than likely investor's attention will be re-directed to market fundamentals such as company earnings, economic numbers including the massive debt the government has weighed on its own head.

    I don't know about you guys ---- but this market is very similar to '98 (doom and gloom).. by all means stay short, i'm also short..

    The risks of shorting here is fine, but we are approaching levels where fundamental value outstrips everything else....

    Only 17% of companies on the SP500 thus far have indicated they will miss their target. That is not a bearish sign, but you also wouldn't be throwing your life savings into the market once the dust settles... Technically the SPX is in freefall mode...

    Fall street lost us$70 trillion of its value in 12 months. Funds in the US yesterday sold a massive $1.5 trillion in equities in one day. It is clear to me the selling yesterday was almost exhaustive..

    Some will say 'there is no value in the market because the economy is cactus', and that is correct where numbers are viable in a historical sense. The market thinks forward --- past p/e's are a robust guide but are also irrelevant. The S&P tech index p/e is still trading at fantasy land 48 as of yesterday ---- there are indications this will almost halve by 50% by the end of '03 and this I believe will definitely happen if the American population take large doses of anti- depressants..

    Traders who have done their homework and have gone though market capitulations in the past will understand... there are certain sectors where you stay short and others you shouldn't short as the market will re-direct its focus and begin to decipher the weat from the chaff looking forward in a stock specific sense...

    Cheers, Zee

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