I also held on to my shares...
Periodically, there is alot of talk of the
incoming great crash. In last weeks edition
of The Economist, this made the front page
of the magazine. During the last 2 years,
however, investors have talked themselves
into selling several times and create rather
attractive market lows (July 96, April 97),
but I personally don't think the dynamics for
a bear market are in place. Economy is strong
enough to maintain good coorporate growth and
long bond rates are very unattractive, even
if there were another 1/4 point hike. I think
what will undo this bear market would be a
significant slow down in coorporate growth
(not too much inflation, as is a popular argument)
associated with a deflationary period (something
like that happened in Japan). However, US$ seems
to have retreated recently, which should help.
Companies are generally reaching or beating estimates
(I follow only the high tech sector), showing the
solid foundations of the economy. Personally,
I still find several attractive values (growth
rate significantly higher than p.e.), especially
in the mid to small cap high techs (e.g., WDC, RDRT,
IOM, MRVC, LUNR, TLC, TMPL, ETC.). So I don't
see armaggedon yet!
I was happy to see SFA hold well in Friday's
downdraft. I don't believe, after their very nice
quarter, seeing a p.e. lower than 20 on their
forward estimates. So 20-22 should be a solid base
on which to built... Hope I'm right. Been so before,
but also been wrong :)
Trilobyte |
