Jack: I'm rethinking my attitude about this market based on who is buying it, and why. I'm going to dig into the subject and post what I find.
I'm a little concerned about the way pension plans are willing to buy this overvalued stuff because they are only concerned with its imputed value 30 years in the future for a world population much bigger than it is now. If that's the game, the wait could be a long one. Microsoft and Dell will go up because they are parked in indices and somebody in a pension plan is buying the index, month after month.
The growth right now is in the Russell and Wilshire indices and the OTC BB and ADRs, I'd guess it will be this way for many years.
Better to park a little money in the S&P smallcap index, ignore the S&P and DOW, and buy what seems reasonable before the pension plans get it. Your mission, should you choose to accept it, is to get to a stock before the pension plans, and hitch a ride on their buying spree. The pension plans largely buy the stock index of the country the employee resides in, so in the case where large multinationals are expanding into India and China it should drive up those indices for reasons having nothing to do with valuation. The webs folks have an international index, that should be a good place to park money on dips.
If you want a very very safe place to park some money without much downside, buy legg mason or eaton vance- they are on the index so during any dip somebody will buy them preferentially if they have to buy something. It's incredibly useful to look at the list of stocks on the index, pick from these stocks. REMEMBER SOMEBODY IS ALWAYS BUYING THE INDEX. Check the S&P info for stocks recently added to the index- the turnover is high so it's a great place to find things that just have to go up because THEY BUY THE INDEX. Yup.
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