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Strategies & Market Trends : MDA - Market Direction Analysis
SPY 681.43+1.6%4:00 PM EST

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To: donald sew who wrote (39916)2/12/2000 7:52:00 AM
From: Haim R. Branisteanu  Read Replies (2) of 99985
 
Donald, just to look at the averages may be misleading. I would prefer a chart based on total market capitalization including in the money option and employees stock option (puts/calls will be a wash but there are more call outstanding than puts).

I think this way the steep rise of prices are better reflected than just averages. My speculation is that it may add about $1.5 to $2 Trillion to the present $17.5 trillion capitalization (or 25% to 30% of GDP).

This also may explain why a 30% correction may spell RECESSION, as many option will just evaporate, or around $7 trillion will be dust. This amount is close to the yearly US GDP of $8.5 Trillion.

Just wonder if this data is available and how different it may be.

Haim
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