NW, Living here in Palm Beach County, I make it my business to find out what is going on <G>. In fact, it has become almost an obsession for me lately, I am sorry to say.
Personally, I suspect the real rally (if and when we get one) will be triggered by two distinct events.
First, the rally will not begin until the month of November is complete. That is because the mutual funds that were selling in late October cannot repurchase before late November in order to avoid the wash sale rule. These guys have enough influence to control the market mood and keep prices depressed for a while, IMO, and they do not want to purchase at a price higher than what they sold it for earlier in the year.
Second, from a political perspective, the US Supreme Court has never rendered a decision in less than 4 days, saying that any decision would not be forthcoming before the middle of next week at best, if they are satisfied with the oral arguments made later this Friday.
From this decision, two things will happen. First, the simple case, nothing, which will allow the process to continue in the state courts until the 12th or beyond, with no finality unless an adverse decision against the Gore team is rendered making his effort futile going forward. Otherwise, contests could go on for several months if no one concedes -- easily.
Second, if the US Supreme Court decides to reverse the FL Supreme Court, that may result in the Bush advantage being reset at 930 votes, what it was before the dimple counts, net of military votes. If 930 stands and not enough progress is made in the state court contest proceeding, Gore might concede, giving the market the impetus to rally through the end of the year.
I suspect that anything short of a concession by one party will keep things status quo for now, but in no event do I see a rally without the fund managers repositioning themselves right now and without the political cloud being lifted.
If CPQ were to go back to 28, my calls of this morning might might nearly quadruple. Twenty-eight is 5 bucks away, but not a far cry from where we've been. As to the quadruple, that would be sweet to say the least. |
