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Strategies & Market Trends : Puff Daddy's Mo' Money Mo' Problems
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To: SouthFloridaGuy who wrote (790)4/12/2000 2:54:00 PM
From: SouthFloridaGuy  Read Replies (2) of 896
 
To: Jay Couch who wrote (33643)
From: Stock Operator
Wednesday, Apr 12, 2000 2:51 PM ET
Reply # of 33645

Actually, I have provided technical, fundamental, and theoretical reasons why the market should fall on other threads.

A brief synopsis of my theory:

1) Fed pumped liquidity in 1999 prior to Y2k.
a) Foreigners saw USA as a safe haven prior to Y2k.

2) Many hedge funds thought 2000 would see a retreat - particularly the beginning of 2000...many learned traders thought people were holding off
profits of 1999 to sell into 2000 because of tax implications.
a) These hedge funds shorted.

3) January to mid March was a short squeeze. A great stock for evidence is Rambus. It is well known amongst circles that RMBS was being shorted
the hell out of and many pros were forced to cover at substantial losses.

4) Reallocation into larger cash position and out of tech by pension funds, CalPers (my former employer) is an example in mid March. Abby Cohen's,
Mark Mobeius...particularly Mark, a hero of mine since I was in junior high school.

5) Fed draining liquidity now that Y2k is over.
a) Foreigners selling because they see opportunities in their own emerging markets.

6) Intense margin buying by daytraders, hedge funds, and an overall arrogance about man's place in history.

7) The charts. Take all emotion out of the game and go strictly by technical analysis. There is certainly no fundamental basis to value these guys so I
read the chart and tape. Both say a sell.

In conclusion: Do I think CSCO will go to 45.? Yes. Will it? Of course not, nobody knows.

But I certainly have provided more evidence for my opinions than anybody else here.
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