Word: baumohl
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Dates: during 2000-2000
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Meanwhile, though, we have to look to Washington for assurances, and that's a little fuzzy. According to TIME financial correspondent Bernard Baumohl, although there are certain immutable red flags that signal monopoly power, the Justice Department and FCC each have their own way of doing things, which can be trying for companies who need the go-ahead from both agencies to continue a merger or acquisition. "While the DOJ maintains long-standing, black-and-white parameters to seek out monopolies, the FCC tends to undertake a far more subjective and changeable analysis," says Baumohl. AT&T, take note: While...
...What's going on? "In March and April, interest rates were going up very gradually, and tech investors figured Greenspan would taper off, because this was an election year," says TIME senior economics reporter Bernard Baumohl. "Now, the inflation picture is getting worse, and Greenspan is getting serious. And they're feeling the effects of higher interest rates...
...investors, tech stocks have always been wobbly, with their stratospheric price-to-earnings ratios and fluid business plans; now they're starting to careen, mostly downward, with regularity, and other bets are only getting better. "The higher interest rates go, the more lucrative bonds and T-bills are," says Baumohl. "When 30-year bond yields get over 7 percent, with absolutely no risk, money gets shifted out of the techs and put elsewhere." And then there are the fundamentals, which were never the tech sector's strong suit anyway. "When rates go up, companies don't have as much money...
...expanding at a pace that has Fed chairman Greenspan nervous. "The dominant view had been to expect a further one-quarter percent rate hike in June, but if the economy continues to show strength that may well turn into a half-point increase," says TIME Senior Business Writer Bernard Baumohl. "Even in increments, the rate increases eventually dim the outlook for profits, and that has an impact on the market. The Fed has been stepping more and more firmly on the brake to slow the economy, but investors are clearly uncertain as to whether the brakes have yet taken hold...
...silver lining for investors in Greenspan's desire to get the job done quickly. "The need to ensure a smooth landing rather than bring the economy crashing to a halt means that the Fed will want to make any increase in June their last for the year," says Baumohl. "It wouldn?t be at all surprising if, once it absorbed that increase, the market shows a healthy rebound...