"Please substantiate"
First of all, my worry is
relative. I have remained about fully margined since 10/8/98, so I am "edgy," as would be appropriate. I am so far ahead this year that when I review the numbers I feel confused. Nevertheless, I don't think my good fortune is coloring my view that we are too high, and certain sectors are way too high. So my concern is coming from my viewpoint that my insanely aggressive posture requires a let up on the accelerator.
I think earnings on the dow will be 420 in 1999. I think rates will stay low. I think that will lead to a high pe of 24. This = a dow of ~10,000 at the peak. So we are not extremely high, but I think we are heading there too fast.
As far as pockets of hysteria, I have problems with the valuations of yahoo, amzn, and aol. I think we are discounting too much with amat and nvls now. Ko is way too high again. I have a lot of csco, but it is at historically high valuations. There is a long list.
Everything is not too high. I would be very happy with a rotational correction that slows areas that are too ahead of themselves, and puts more money into small caps, transports, etc. Maybe we will get it.
Gene |
