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Strategies & Market Trends : Value Investing

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To: Terrapin who wrote (5173)	10/20/1998 11:11:00 PM
From: Freedom Fighter	of 78887

>>My problem is that every other problem that brought down the market in late summer is still there (foreign financial crises, domestic political crises, enormous consumer debt levels, etc). What could be driving this rally? << I agree with you completely. I suspect that there was some options related buying going on during last week. There have been a number of very suspicious rallies during options weeks over the last 2 years. I call them suspicious because they often occur completely counter to fundamantal developments. I think the Fed rate cut then added fuel to the rally and provoked a lot of short covering and momentum guys to join the party. Problem is that earnings (REPORTED not Operating) have been declining for about a year now and they will be down again this quarter. There is no way to justify current aggregate stock prices if you have a historical perspective. Also, Brazil is having significant problems that have yet to be resolved. All in all I believe this is a DEAD BALD EAGLE BOUNCE...albeit a big one. That said, I really don't care where the market is going. The prices in aggregate are still high for large, high quality blue chip companies. That's what matters. Value Investor Workshop members.aol.com

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