Date: Sun, 20 Feb 2000 12:00:55 -0500 From: Enrique Diaz-Alvarez <enrique at ee.cornell.edu> Reply-To: enrique at ee.cornell.edu X-Mailer: Mozilla 4.61 [en] (Win95; I) X-Accept-Language: en MIME-Version: 1.0 To: lbo-talk at lists.panix.com Subject: Re: stox References: <Pine.PMDF.3.96.1000220012938.539054891B-100000 at OREGON.UOREGON.EDU> Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit
Dennis R Redmond wrote:
> Expectations may be rising, but according to the Fed's own historical data
> charts, corporate profits as a percentage of GDP have topped out. After
> rising from the 7% range in the early Nineties to a peak of 10.09% in
> 1997, profits fell to 9.66% in 1998 and were pegged at 9.51% in the 3rd
> quarter of 1999 (this, despite pretty major interest rate relief). This
> suggests the business cycle is alive and well and about to render unto
> Bubble-land what the global rentiers have been rendering unto places like
> Thailand and Russia. Passengers are advised to fasten their seatbelts and
> salt their hard currencies away in euros for the duration of the
> (capital) flight.
Yes, but this may have to wait until it dawns on Duisenberg that a) Europe has a huge fixed energy import bill, that has to be paid in dollars, and OPEC is unlikely to switch to a currency whose managers let it drop by 20% while pretending not to give a rip, b) issuing a reserve currency has, shall we say, certain advantages and c) the approach to growth consisting on sending crap to the US in return for IOUs is less than ideal.
Enrique