Feb 07, 2003 05:34 PST
Atlas replies: I have no problem with your projected market/gold
scenarios nor with Lloyd's longer-term projections. It is always
interesting to measure the correlation of the "panic metals" with the
current group-fantasies. It is also fascinating to note the
prolonged acceptance of the false myth that the market benefits when
the US goes to war -- or, for that matter, historical patterns of
markets in other nations when they go to war. As Lloyd has repeatedly
indicated in previous postings, usually this is not true -- markets
decline during war phases UNLESS the war action is particularly
"surgical" in its duration and effectiveness.
We all expect this to be a "surgical" strike of less than 30 days
duration BUT this market will NOT bounce because the realization is
clear that there's a prolonged "occupation" following this war.
Despite Abby Joseph's prediction of a 10,500 market by year's end (oh
how so many of us with declining portfolio assets wish this would be
true), most others do not share her bullish optimism. I believe that
there will be some consequential market uptick by the end of the year
(Q4) and into 2004 because there will be an extremely harmful
European downturn in 2003, signalling their collapsed economic
The major negative factor in any market gain or economic improvement
is the "giveaway" proposals of the Bush Administration -- trillions
of dollars already passed last year and up for passing this year.
The more we maintain a "giveaway" process (largely a repeat
performance of the Reaganesque "priming the pump/supply side"
theories -- Bush father called this "voodoo economics, remember?),
whether to the "rich" or slightly benefitting the rest of the nation,
the more the Bushbaby team performs massive cuts in the nation's
ability to maintain social benefits programs, infrastructure
rebuilding or any effective response to emergency needs. The
"givebacks" + the enormous military budget (equal to the next 10
nations combined!) + the projected expenses for the "Iraq Attack"
will plunge this nation into the largest increase in national debt in
US history -- in this sense, the Republican Administration is
destroying the national ability to recover, restore and rebuild.
Some of you may also know that the Administration has been
particularly harmful to NYCity by delaying distribution of the
billions of already approved relief and rebuilding funds. JERRY