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To: TRINDY who wrote (58860)	8/26/1999 4:47:00 PM
From: pater tenebrarum	Respond to of 86076

Trindy, as you say, the midcaps are indicative of what's happening with the a/d line. we have btw yet another important non-confirmation i'd like to point out and that's the FTSE 100 which is still some 300 points off it's high. in the 1970's we used to have a rule of thumb that said a new high in the INDU that was unconfirmed by the FT index was not to be trusted...but then that was a time when another 'new era' had just faded into the annals of history, so maybe it's not so important anymore. but the trannies' divergence clearly matters. btw, looking at the strength of the deflationary proxy stocks in the Nasdaq, i am beginning to wonder whether inflation is really the thing we should worry about. it is possible that inflation will take a backseat to the greater global deflationary trends once again. if so, the bears are coming closer to their day in the sun, as the stock market usually crashes shortly before the onset of a deflationary depression. btw, gold is an excellent investment during deflationary times, as hard assets usually are preferred over paper assets during such periods. stocks like HM were excellent performers during the 1930's bear market for instance. CNBC says nobody is worried about today's bump in the road...a good sign.