----- Original Message ----- From: Charles Brown <[EMAIL PROTECTED]> To: <[EMAIL PROTECTED]> Sent: Friday, October 13, 2000 6:42 PM Subject: [CrashList] Warning signs Rob Schaap's latest analysis of surplus value's wicked circuits. CB >>> [EMAIL PROTECTED] 10/13/00 11:47AM >>> G'day Thaxists, I see Wall St has decided it's time for a spot of bottom-feeding. I'm still not sure it's anything like a bottom. If you leave out the fact that nowhere on the planet seems particularly stable (fragile polities here, fragile economies there - all within a context of wars and rumours of wars), I see the Yank Producer Price Index is showing inflation *after you take out the soaring energy and volatile food sectors*; ``These are horrible numbers, and the real horrible number is the core rate,'' said Peter Cardillo, director of research, Westfalia Investments. And, sez the Yahoo! market watcher, all this is happening amid concerns that banks may have sustained serious losses in U.S. junk bonds and as company after company, especially in technology sectors, reports earnings that do not meet expectations. The news is worse now than it has been during the last six weeks, which was not enough to stop the S&P 500 index falling 13 percent in that time, the Nasdaq tumbling nearly 24 percent and the pan-European Stoxx index losing nearly 10 percent. And GM is feeling the oil problem, too - Goldman Sachs analyst Gary Lapidus has cut his fourth quarter 2000 and full year 2000 and 2001 estimates for General Motors Corp. GM's copping increasing truck inventories, sales weakness in Europe, and slower net income growth in Latin America and Asia than originally projected. Net earnings fell 5.5 percent to $829 million because of larger than expected losses in Europe of $181 million. So oil is hitting where it should finally get noticed (demand forecasts and manufacturing stocks) and there is inflation in the mix in the economy of last resort itself. I don't think today will be as positive as it currently looks, but, even if it turns out that way, I don't think it points to anything our economists like to call 'fundamental'. It's just a heap of money-of-the-mind swishing about trying to convince people it's really there - but it's only one nasty 'external shock' away from disappearing in a puff of belated logic. And no-one is going to convince me a nasty equity reversal can happen in the year 2000 without hitting real producers and consumers. Even as recently as the hiccough of 1987, 'economy' and 'Wall St' weren't nearly as synonymous as they are now - and the culture that's produced this mad identity is not at all equipped to handle it - consumer and speculator debt won't be addressed in time to avoid a nasty chain reaction whereby lower equities translate into bankruptcies, excess capacity problems, unemployment and a plethora of suddenly stretched finance and government institutions. If that possibility doesn't decide 'investors' this time, it'll certainly be in their minds next time. I reckon the bull-run is over, meself (reckon it has been for 18 months, actually) - and I reckon Greenspan hasn't the arsenal available to him to do anything about fluctuations in 'market confidence - he can't cut rates without inviting inflation fears and exerting pressure on the currency upon whose buying power dozens of national economies depend, and he can't raise 'em without a structurally volatile market pushing a few million margin-punters into system-threatening panic. So some time soon we're gonna find out if we really do have a better safeguard system than we did in '29 ... Keynes would get out now because he'd be worried about other players' apprehension of the other players' nervousness, Schumpeter would get out because this looks just like the denouement of the 1893 rail boom and the 1929 electricity/automobile boom, Hayek would get out because prices aren't reflecting anything in the real world, and Marx would get out because so many punters have taken the tag 'information economy' to mean a C is no longer required to get us from M1 to M2. Who am I to disagree? Anyone wanna take some issue or take my fears to a sessional high? Cheers, Rob. _______________________________________________ Marxism-Thaxis mailing list [EMAIL PROTECTED] To change your options or unsubscribe go to: http://lists.wwpublish.com/mailman/listinfo/marxism-thaxis _______________________________________________ Marxism-Thaxis mailing list [EMAIL PROTECTED] To change your options or unsubscribe go to: http://lists.wwpublish.com/mailman/listinfo/marxism-thaxis _______________________________________________ Crashlist resources: http://website.lineone.net/~resource_base To change your options or unsubscribe go to: http://lists.wwpublish.com/mailman/listinfo/crashlist
