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Strategies & Market Trends : Bob Brinker: Market Savant & Radio Host

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To: wooden ships who wrote (5951)7/14/1998 10:10:00 PM
From: Alan Bell  Read Replies (1) of 42834
 
Balancing to the appropriate asset allocation is certainly sage advice in these volatile times. But pulling more than that from the market could cause one to follow the path of the bad news bears.

When we think about the huge gains we have had because of PE ratio expansion over the past few years, we recognize that they aren't likely to continue. So the obvious answer is that there must be a bear market. But there is another alternative - a rise (though volatile) of high single digit gains which follow earnings growth.

With interest rates being as low as they are, 8-10% annual equity growth looks pretty good.

-- Alan
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