Hi Ram: I agee with you 100% in your fundamental approach to sound, long-term investment strategy and this approach should work most of the time. However, this strategy takes time and time is NOT on the side of the fundamental investors. Why? In this high tech world, information often travels in light speed (using fiber optics). This technology drastically shrinks the time windows that most long-term investors are familiar with. In addition, new trading vehicles such as options, derivatives and others will further shrink these windows. Even Andrew Addison understands this shrinkage and stated in today's Barron's: "this is no market for buy-and-hold investors"
With the 1997 clouds looming, I like to be on the side of tea leaf readers and become a short term trader for obvious reasons. And besides, you can now find many companies despite great earning and potentials stay in the bottom of their trading ranges because they are virtually UNKNOWN to most investors. Why unknown? Lousy PR work. That's the answer. Clinton was elected 4 years ago because of his superb PR work. You scored last night because your girl friend was impressed with your penetrating PR work. Of course Mr. Ponzi is the king of PR work that every amateur should learn from.
In todays Barron's, A. Addision wrote "...once the blue-chip rally runs out of steam - probably before year-end - we could very well see the Dow below 5000...". Byron Wien also wrote "...when the 1000 point decline ends, the market will go to a higher high....". Sounds familiar, isn't it? These guys are echoing and re-stating the mad monk's vision (posting #144) as predicted. I am glad that this monk is only slightly ahead of these so-called analysts. Ram, picture this: assuming that ALL stocks go down in the coming bear market, how many years will it take them to bounce back to the original prices PRIOR to the crash? In 1974, it took them 5 full years!!!
Ram, I am sorry if I sound a little harsh in this posting. Being a devoted tea leaf reader, I have to call what I see, right or wrong.
I welcome your dissenting opinion. Thoughts are boundless. Only life in this world is limited.
Best wishes from a mad monk.
PS. Beware of this guy from Morgan Stanley. For he completely missed the 1987 call and compounded his errors when the market turned. |
