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Strategies & Market Trends : ahhaha's ahs

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From: Ron Dior6/26/2014 12:55:50 PM
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Just thinking out loud for purpose of discussion. Through many discussions Ahhh always made a point to remind me “It’s a Market of Stocks”. It’s a familiar investing term so I got what he meant but he always referred to it in such a specific way that maybe there’s more to his muse.

It got me thinking the other day. The market right now has been caught in this funky flux. As usual all of the talking heads are trying to explain what’s happening. In short the market continually goes higher with little correction and on little volume. Now I’m far from a market technician so maybe my thoughts are far too unsophisticated but what if.

I pondered on a bunch of things that Ahh had been pounding into my head over the last year. Key buzzwords of his referring to current market “Market of stocks”, “Trading no longer works”, “Most stocks are cheap right now”, “Technology is changing the economic paradigm”, “We are in a New World economy”.

Here is my thought on all this. What if this time, for the markets history will not be repeated and will have little bearing on the future? What if some day soon the US economy as a whole has no real effect on the stock market? What if we never get another big correction in the market again? Now I’m not suggesting there’s no way the market could ever crash again due to some major geopolitical uprising or something else unforeseen. But what if the game has severely changed from here on out.

The entire world is now interconnected in multiple ways. The new tech paradigm has expatiated this process. Due to these changes and others a company’s success is rarely dependent on one or two factors anymore. Companies have become masters of overcoming adversity, masters of change and finding new ways to make and preserve money. What if the term “Market of Stocks” has taken on new meaning? What if only individual stocks were to correct but not markets as a whole? After all stocks correct 5%-10% all the time. Could this market continually move sideways with a bias to up never having a major correction again? For stocks, no more throwing out the baby with the bathwater so to speak. A true market of stocks!

This could be the perfect storm. We have tons of money sitting on the sidelines because investors are waiting for this so called correction thus the low volume. We have many many companies making money so their stocks are cheap. The market continually drifts higher which forces investors to buy on dips. It’s a continuous loop and the higher the market goes the harder it will be to break.

Everyone keeps saying history has taught us that this Bull Run has to eventually end. What if history is wrong? What if there was more to what Ahh was thinking?

Just a thought…..
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