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Pastimes : The Justa & Lars Honors Bob Brinker Investment Club
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To: MrGreenJeans who wrote (11247)1/17/2000 9:12:00 PM
From: marc ultra  Read Replies (2) of 15132
 
MrGreenJeans re<<<<<
Would you care to comment on a comparison between 1976, as detailed in the September 1999 Marketimer,
and 1999 to the present? It occurs to me that similar patterns may be in play. The fact that Bob has gone to 60%
cash indicates a severe deterioration in outlook.>>>

Since I said market action seemed partially responsible for the call this is a reasonable issue. Going back to the September Marketimer looking at his possible 1976 type topping process we had the area of benchmark highs reached in May 13, 1999 with Dow 11,107 and what at the time looked like a possible benchmark high on July 16th at 11,209. I believe he said the initial move into benchmark high area was probed but should not be exceeded by more than 5% It is interesting that the close in the Dow on 1/14/00 at a new high of 11,723 was only 5.5% above the May 99 high and 4.6% above the July 99 high that we were considering as possible benchmark high at the time. We can conjure up all sorts of explanations why the NASDAQ was running rampant earlier, speculative fervor at the end of a bull, perhaps semiconductor explosion giving the NASDAQ a cyclical element or whatever we want if we feel to be perfect we need to pound a few square pegs into round holes. It's not 1976 and we don't have to be perfect and anyway what is missing was Bob's stated bear signal from his model. It is a somewhat threatening similarity to 1976 that the S&P500, and NASDAQ which which was leading the way, both hit their highs on 12/31 and have lost some ground since despite the usual trend of strong early Jan inflow. So we have a market that except for the NASDAQ powerhouse has really made very little progress from the May 99 highs. It can't really be discounted that we have remained in the process of making a top and with fundamental conditions and sentiment deteriorating as reflected by Bob's model or even basic cognition and a downturn from here should be no surprise to anyone here.

Marc
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