My 2 ¢:
Great bull from 1945-1966. Then, a long topping process began. 1966 was the first top, but then everything ran right back up, a speculative frenzy into 1968 for the second top. Wicked bear 1969-1970. Now, Nifty Fifty dominates the rally, more and more. Small caps are getting hit more and more from 1966 to 1973. In 1973, big caps get crushed, but already-beaten-down small caps go down too. Then, starting in 1975, small caps, having been beaten down for years, begin to rally massively, 35% annually from 1975-1983. The big caps do zip for those 9 years, because their bear market just started in 1974.
My point is, small biotech will probably get a final capitulation this fall when (if) we have a nice 30-40% bear market. Thereafter, they will finally begin to reflect reality.
O.K., that was at least 3¢. <g>
Tom |
