Dave,
The market seems puzzling, climbing to new highs when corporate earnings are slowing down. Almost a classic description of "irrational exuberance" at the height of a bull market. However, this is not the historical bull market... this is a "new economy", "paridigm shift" type of bull market. It is unlikely to end, unless a significant dislocation happens in the economy... something big, something unexpected... don't know what. Until such time, the market will continue to be dominated by fund managers climbing over each other, compelled, forced, to take part in the market, less their performance numbers lag behind. Those prudent fund managers with lots of cash, or silver, or gold bullion, parking during these times of frothy market valuations, have looked foolish. And they can't afford to be seen as not smart. So they climb on... like a human totem pole, with the ones at the bottom feeling more pain, and scrambling over bodies to get to the top. Unless some dislocating happening takes place, IMO, this scramble will continue and the market will go higher. The only exceptions are stocks that have warned or reported poor quarters. Even then, as we saw last week (COMS, etc.) the institutional investors are quick to rationalise the poor earnings, and to bid the stocks higher.
... so the beat goes on...
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