Kodiak, you may be right about that chip counting thing in January. I'm taking a page out of the book of Dabum and MetalTrader and not second guessing the run up in the techs. If it wants to go up farther, whether or not I agree, I am certainly willing to take that ride. I hope that I don't take the elevator all the way down when it doesn't reach the top floor.
On an intellectual level, I also think that the market has gotten ahead of itself fundamentally but there are many factors involved including the baby boomer money, the fed cuts, the prospect of fiscal stimulus if things get bad, signs of real improvement in lower inventories and increasing orders in key sectors, and strength in the service sectors with continued strength in consumer spending and increasing public sector spending. These factors may justify the belief that the indexes will be higher at the end of the year and may justify any long term money that is getting in now.
The truth is that almost all of us have underestimated the timing and strength of this latest up wave. I still would not buy the semiconductors at prices of last month, much less those of this month. What that make me; is WRONG! (Way to go Gottfried. It kills me to see asyt run up since that laggard was a slim possibility for me still.)
In spite of my fear that this house of cards will collapse, until I see a down move that doesn't appear tentative and doesn't look like consolidation, I will stay invested at about the level I am at now. I am currently about 75% invested and almost all of it is in biotech and tech.
The purpose of my last post was twofold, first, I couldn't resist messing around with your medical "patient" analogy which I thought raised the issues in very understandable terms. As a second purpose, I had fun writing it. g.
What I was saying there was part of a theme that I have been thinking about. I suspect that we often underestimate the monster size and vitality of the U.S. economy when we focus our worries and concerns on the imbalances and inefficiencies that exist. The market may be wiser than we are in judging that the problems in the economy are not as large in a relative sense as they look in the focus of our microscopes, and in apparently determining that in the forseeable future the economy will not just survive, but become strong again.
Maybe increases in real income will support increased consumer debt, maybe companies like enron that cook their books and skew the efficient allocation of capital are tiny pimples on the complexion of our huge economy and those pimples will heal over without scars, and maybe AG can keep the people confident and carefree that make the decisions that keep money circulating and people working.
I know, and maybe there's a tooth fairy too. The point is that right now there is a strong move up in the markets that is too powerful and too sustained to be manipulation. That move, even if it fails tomorrow, says that the problems we see as major, may not be. Whether that view is correct or not, it deserves recognition as a force that is moving this market. Ed
PS, I threw in a few long run on sentences so I wouldn't get that "murder" thing hung on me or get thrown in with slick Willy for a "slick prose" violation. Actually, being thrown in with Willy for articulative ability wouldn't be such a bad thing. I could never have kept his pace, however; the truth constrains me and with his talent, that's a big handicap. |
