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Old 06-20-2002, 10:25 PM
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Default You are misreading the situation



Treasuries are a scary place to be right now. Remember treasuries are owned a great deal by foreigners, they love em because they are one of the few risk-free investments in the world, or so the thinking goes. The run-up in rates today could portend a dark cloud if this currency run kicks into higher gear. I don't think there was profit-taking at all, I think its more people from overseas taking their money altogether. As they flee, the rates are bound to go up.


I don't know though if the currency run will continue unabated. I still find it hard to believe foreigners see better prospects in their markets. I mean what is so appealing about Europe or Asia right now? They go lock-step everyday with the US markets, half the pressure on the index seems to be purely reaction to US market moves or anticipated moves the next day. Think about it, 10 years ago if an American company announced an earnings shortfall, Europe would have shrugged it off and mostly stuck to themselves. Now if Cisco or Intel says something, it causes 3% sell-offs in Europe, often due to the expectation that the US market will do bad in its next session. This is pure stupidity, how Cisco misses its revenues by a couple of percent has almost no effect on European companies. Simple as that, but the markets are the way they are now and you have to accept that. As for CEO's stealing, that is another outrageous claim. A few CEO's have made some questionable ethics decsions and now CEO's are crooks? Are you kidding me? I mean Kozlowski did something clearly illegal and deserves to be in trouble for it, but come on the guy was trying to cheat on his personal taxes. Not the guy you want running your company no doubt, BUT his personal behavior on that matter had very little to do with his own company and his actions didn't change a fundamental thing about his company. Now that he is out, it really gets silly to pound down the company's stock price because he is indeed not going to be calling any more shots. I don't know, I accept that the fear and worries are hurting the market, but this is irrational fear (opposite of exuberance I guess). CEO's are in very broad terms, very respectable and driven people. Almost all today have a duty to grow their company and stock price, and by almost any measure they do it well. Its an extremely difficult job, the guys that go down usually have very little direct control on the things that go wrong. Some guy four levels down could be harassing women cause he is a real creep leading to multi-million dollar lawsuits. The lawyers suing will claim its the CEO's fault cause there wasn't a strong policy out there. In reality every company has a policy out there, but all it takes is one real jerk who doesn't get it and the whole company suffers no matter how good the policy is and the CEO who never met the jerk gets blamed for it. So before you go calling them crooks or think they aren't out to make you money, just remember if they make mistakes these days its often the fault of the investing public. They won't accept a CEO that doesn't grow a company an unreasonable rate. They won't accept a CEO that gets outmaneuvered by another company that took great risks in doing it. Worst of all, the investing public won't take responsibility for their own damn investments! They should come gamble with us and see how we take responsibility. If the Mets lose and I bet the Mets, oh well I lost I took the risk of betting on the Mets and it didn't work out in my favor. Investors take the point of if I invest in something and it loses value its someone in management's fault! I don't pick losers, I must have gotten screwed over by management or auditors or government people or...well you know the mentality. People people, invest understanding that you could lose every single penny of that investment. Period. On occasion there are some frauds out there, BUT that too is part of the investment scheme. Its a potential issue, your trust in management. 99.9% of the time management is on your side, maybe a bit agressive, but still on your side. If you lose money its just part of the reality that is investing. Stop investing your whole nest-egg in two stocks or leaving every penny of your retirement in company stock and you won't get crushed. Why doesn't anyone ever seem to point this out????
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