Rarebird, stock mutual fund inflows have been in a steady decline since 1996. There is a lot of foreign money in this market because of the strong dollar, that money is not captive like IRA money or mutual fund money.
>>>I've just seen a big move in July and thus far in August sideways action with a downward bias. This market can move sideways and churn for another 3 months<<<
It's hard to imagine such a vertical rise in the market just meander sideways. People are sitting on big quick profits and won't just watch them stagnate or drop.
>>>bull market won't end until we get a real major speculative blow off amongst the small caps.<<<
What do you call the vertical blow-off of SOXX index (semiconductors), main component INTC rising 35% in a 2+ month period. How about a gaming stock SLOT making a 300% move since April low. The landscape is littered with this kind of excess. I remember people earlier in the year thinking that INTC would make 200 by year end. Hell it made it split adjusted by early August. There are hundreds of stocks with charts that have the last leg up as almost PERPENDICULAR. INTC, MSFT, CMB, MOT, JBIL, DELL, . . . just about every story stock.
It's just hard to recognize this is taking place while your inside the bubble. I have to constantly filter out the noise and the media who sells the company goldilock line myself to see whats really going and my self proclaimed nickname is bobby beara -g-
The S&P has broken it's uptrend from April lows and the coup de grace was KO announcing flat revenue. The symbol of safe investing in big caps has just come to an end. Big behemoth multinationals with single digit growth rates and p/e's in the 30-40's which will have problems keeping growth positive with high dollar and foreign competition. And Goldilocks told you we were going to sell all the Cokes to the Chinese and Russians. I guess their making their owns soft drinks and the Coke will go flat. You can forget those Gillette razors too! The Chinese can make em a whole bunch cheaper. The devil here is not inflation, but deflation and loss of pricing power for companies to sell products at a profit in an increasingly more competitive capitalistic world economy. The Russian and Chinese capitalists who are running very lean and mean will be able to undercut our prices and many many products. Already about 80% of our shoes are Made in China. I can see Made in China making the same transformation Made in Japan did from the 60's to the late 70's. If this is the Goldilocks economy and the American Economic Engine is so great why do we have a wopping trade deficit. Read my last sentence.
Specialist Short Interest has increased from 35% to 45% in the last month. Specialists have a notorius accuracy for calling market tops.
In today's action we had very positive inflation numbers. What happened - a rally. A month ago that rally would have lasted days, but this one lasted an hour and a half.
The new cry is sell the rallies. If you buy the dips, you better have a tight stop loss.
I think it is good your only 20% long.
bobby beara |
