From the BULL MARKET (Saturday)a commentary indicating world mkt manipulation by Uncle Al.. probably the only single person with the ability...
COMMENTARY
Yesterday's sell-off didn't have to happen. Sure, the inflation numbers
weren't pretty, with the wholesale price increase reaching 1.1% for the
month, but the culprit was Greenspan. This is about the fourth time he
has done this in the past three years. He has caused the world's
investors to lose billions and billions of dollars, and yesterday was no
exception. He spoke Thursday night after the close and the world markets
from Japan to Hong Kong to France, England and Germany collapsed on
Friday. By the time we woke up on Friday, the Dow was opening down 200
points. Then he makes ANOTHER speech in the afternoon and the US markets
just collapsed.
Here's a quote from the wires: "The mighty words of Federal Reserve
Chairman Alan Greenspan sent a shiver through global equity markets in
overnight trading. Speaking at a conference of bank regulators,
Greenspan conjured up memories of his "Irrational Exuberance" speech of
1996 [when the Dow was around 6,000 - Ed.] with comments stressing that
investors need to remain cognizant of the level of risk associated with
investing in the equity markets. The cautious tone of his observations
underlie the Fed Chairman's continued unease with the market's
historically high valuation levels."
OK. So where do we stand? Actually interest rates declined a bit
yesterday despite the bad inflation numbers. Why? Because when equity
markets fall sharply around the world there is a "flight to quality"
whereby investors dump stocks and buy US Treasury Bonds. They are safe
and liquid whereas stocks can be volatile and dangerous, as you know. So
we had a made rush of buyers meeting the sellers and effectively bonds
went up a bit. Hurrah for small favors.
The Dow lost a record 630 points for the week, and this after the Nasdaq
set a record high on Monday! Prices were up 1.1% in September, the
highest jump in 9 years. So there are some concerns here. And the
financial stocks were hit the hardest with stocks like American Express
(AXP), Capital One (COF), Citigroup (C), Merrill Lynch (MER) and others
getting killed.
The major markets were all off about 6% for the week. The Russell 2000
was stronger, finishing down 3 percent. The Goldman Sachs Tech Index
(GSTI) was nailed for almost 13% though. So if your stocks were down less
than 5% last week, you were doing OK, compared to the rest of the market.
The Dow is still up 9% for the year and the Nasdaq, 25%, but the S&P 500
is almost flat now. |
