Hi Bill,
Your insightful analysis has confirmed the nervous feeling that I've had in my gut for the last two weeks. Thank you very, very much. Without your help I might be hanging on trying to get that last few % (went to all cash as of today)
I've gotten myself caught up in this speculative orgy. It's like drug addiction, the person involved is under the ether of the "good feelings" and is unable to look at the world with any reason. I even bought and sold HEC last week (a mini BRE-X?).
If this follows the 1929 chart, it looks like we might see the Dow much higher, maybe even 9000. Not going to chase it though.
I checked out of the library Galbraith's "A Short History of Financial Euphoria" I suggest anyone who has not read this book, run-not walk down to the library. An excerpt: In the winter of 1929, Paul M. Warburg, the most respected banker of his time and one of the founding parents of the Federal Reserve System, spoke critically of the then current orgy of "unrestrained speculation" and said that if it continued, there would ultimatley be a disastrous collapse, and the country would face a serious depression.
He was held to be obsolete in his views; he was "sandbagging American prosperity"; quite possibly he was short in the market.
In the winter of 29' Warburg raised interest rates, from which a correction insued, the market rallied into the fall on 29'
I've been spending a lot of time in the last couple of months at the library. I noticed that most of the financial books I checked out were written in 69-71 period. When the recent unemployment rate was announced "the lowest since Nixon" the light bulb came on. However, your work wacked me in the head and inspired me to be proactive. Thanks again and may God help us all if this thing plays out like 29'. |
