Perfect timing! The following guru says that we are going to have one last Bull Run to new highs before the Bull Market is over sometime early in 1998:
"Market Monitor"-Douglas Jimerson Of National Investment Advisers
PAUL KANGAS: My guest market monitor this week is Douglas Jimerson. He is the president of
National Investment Advisers which is a Potomac, Maryland based advisory firm. And he is also the
editor of the monthly newsletter "National Trendlines" and welcome back to NIGHTLY
BUSINESS REPORT, Doug.
DOUGLAS JIMERSON, PRESIDENT, NATIONAL INVESTMENT ADVISORS: Thank you,
Paul. It's great to be here.
KANGAS: Speaking of trend lines, are we seeing enough damage to bullish trend lines to make you
something less than bullish?
JIMERSON: Volatility. You know, I think Verde expressed it best. (singing- Lu dow a mobile, clou
you my vento). Moving like the wind, the markets are fickle.
KANGAS: What our viewers probably aren't aware is that you are a professional singer. So, that's
a very good way to express it. But everything seems to now be much like it was prior to October
27, when we had bloody Monday. The Asian markets down and Japan particularly lower in the
Latin American markets. Are we leading up to another bloody Monday next Monday?
JIMERSON: I don't believe so. I think we have to look at what's happened in context. You know,
the Dow reached its high in early August, and the correction started then. I think that we actually
saw the culmination of that last week and the retest of those lows today. And this to me looks more
like the event of 1989 than the analogy of 1987. It's a short, short 7.0 percent shock to the system.
KANGAS: Well, you know, the last time you were with us in late March, we had been through a
very severe down turn at the time. The Dow was 6740 and you said don't let it scare you, stay with
it, buy some more growth funds. And buy more Chevron (NYSE:CHV), which at the time was 69,
it's now 85. You said buy Schlumberger (NYSE:SLB). After a two for one split, it's-it was 55, now
it's 93. And of all things, you liked Intel (NASDAQ:INTC) which was at 69. And it bucked the
trend today, up 77. Are you taking some money off the table in those nice big gains you have?
JIMERSON: Well, here's what we did. You know, two years ago we talked about oil stocks. And
Chevron was the choice. Schlumberger we added a year ago. In the spring, I said buy Intel and sell
it at a high, or matching the high, which we did. Now, it's a buy Intel again. Sell it at the high. That
would be a 30 percent run.
KANGAS: Now, the one little clinker you had was Placer Dome (NYSE:PDG), the gold stock, at
18, it's now like 15. Will nothing move gold higher?
JIMERSON: You know, this is a classical period for the low price for gold stocks, this November
time period.
KANGAS: Yes.
JIMERSON: I believe we are near the end of this very long term bare market. So again, still Dow
cost average into the gold stocks, gold funds. Just a little bit in the portfolio.
KANGAS: You still like Placer Dome?
JIMERSON: I do.
KANGAS: OK. Let's look at some new ideas that you might have here. You sound a little bit on the
defensive side-not as bullish as you have been.
JIMERSON: Well, that's correct. I'm cautiously bullish. We are approaching the end of the bull
market. We continue to look for contrarian areas. And investors need to take defensive strategies.
KANGAS: OK, let's get to them quickly.
JIMERSON: One, is diversify the portfolio. Two, is continue to buy natural resource stocks and
funds.
KANGAS: Yes.
JIMERSON: Three, is get casualty insurance on the mutual fund portfolios. Now, in terms of
diversification. Look for mutual funds that act differently from growth funds. I've got to remind our
viewers that just buying a dozen growth funds is not diversification. We need other types of funds.
KANGAS: Get specific, if you would.
JIMERSON: All right. Let's say if T. Rowe Price New Arrow Fund and natural resource fund or
Putnam Natural Resources and maybe a small position in international bonds, like the T. Rowe Price
International Bond Fund, which when the bull run ends, sometime next year, I believe, our going to
be good performers.
KANGAS: OK. So stay with Chevron (NYSE:CHV)-Schlumberger (NYSE:SLB), Intel
(NASDAQ:INTC), any new additions to individual stock purchases.
JIMERSON: Well, I would continue to-I would add to Schlumberger and my new choice for tonight
is Conagra (NYSE:CAG), symbol CAG.
KANGAS: On the Big Board.
JIMERSON: Around 33. It was up today. And I expect that is a stock that's going to continue to
advance.
KANGAS: That also would be kind of defensive, being in the food business.
JIMERSON: It's in the agricultural food business. That I think is...
KANGAS: New high in the Dow in the next six months?
JIMERSON: It's coming certainly by early next year.
KANGAS: But beware, because then the risk/reward ratio becomes very thin.
JIMERSON: That's right.
KANGAS: That's what you're telling us.
JIMERSON: Yes, sir.
KANGAS: OK. All right, Doug, as usual, very interesting outlook and I'm glad to hear that you
think there's still life in the old bull.
JIMERSON: Oh, yes. It's a great run.
KANGAS: Great. Thanks, Doug.
JIMERSON: Thanks, Paul.
KANGAS: My guest market monitor Doug Jimerson, the president of National Investment
Advisors.
Hmm, no mention if he likes KGFC!!! |
