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Strategies & Market Trends : DAYTRADING Fundamentals
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To: Sir Francis Drake who wrote (8578)5/27/2000 9:50:00 PM
From: booters  Read Replies (1) of 18137
 
<how will a MODERN bear market differ from a traditional one? >

It will look just like all the others. It will feel just like all the others, and it will be for a new reason everybody saw at the time but no body understood, just like all the others.

I think the difference will be the speed at which it will happen and the speed of the recovery. I think this because of the flow of information and the education to deal with the information. If I don't have TV and can't read I might leave North Carolina where they have just decided to hire thousands at good wages to build the Blue Ridge Parkway,and drive my family to California where I
heard 3 month old news that growers needed farm hands.

Fast in fast out.

But another thought also dealing some what with information.
What if this is just an internet boom and bust? We have a new addition to the economy. It's exciting. It's different. It deals with the disemination of information to the masses at an incredible speed and is almost frictionless. How do we decide what that is worth? The company makes no money now but think about the possibilities. What does 200 times earnings mean when earnings can increase 10 fold in weeks.
And what if I give a new generation that has never seen anything but a historic bull market,a self directed retirement plan and the ability to push a button and buy a stock for pennies a share.

If these companies are worth that much, then wow, the old companies ought to be worth alittle more. They can go on the internet too, right?

So everything gets drug up in the frenzy. Then reality begins to set in. The internet is going to change the world but it is going to be a little harder to make a profit than we thought. As the .coms go down it drags everything with it. But only to a point. The old companies are still worth what they were before the frenzy and so we soon settle back into the wonderfully mild bull market that started what seems like 20 years ago and everybody is happy again except the new guys that bet everything on the frenzy and will never be back again. As I already said "Just like before".

So, maybe the new thing in this bear market is we had a SECTOR boom and bust market that caused a large wiggle in the overall market but nothing too serious. Could everybody say after it is over that you saw it but didn't understand it at the time? If so we have a great candidate.

(Grossly over simplified but fun to mull over)

IMHO

boots
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