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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: John Carson who wrote (33404)	11/14/1999 12:53:00 AM
From: Dwight E. Karlsen	Read Replies (1) \| Respond to of 99985

John, I should have said, "add to" my index puts. I bought last week also, with one buy being last Friday. Needless to say, the bubble is stronger than I thought. Btw - look who's speaking of bubbles: .."an icon of the bond market. Chicago-based mutual fund research firm Morningstar named him fixed-income fund manager of the year for 1998. A few years earlier, Pensions & Investments, the bible of institutional investors, called [William] Gross the most influential person in the business. Gross, 56, a wiry tenor who spent four months just after college in the late 1960s playing blackjack nonstop, is the chief investment officer for California-based PIMCO Advisors, which has nearly $225 billion under management. But the streak of winning bets creates a paradox, Gross said: The upbeat outlook remains in place, with one big risk. "The financial bubble stands a chance of throwing a monkey wrench into the equation," he said. In his view, the lure of successful betting sows the seed of destruction. "I think we're in fine shape, absent the bubble. It's the only thing that can turn off the prosperity we have going forward." In other words, the hordes of financial market vigilantes, shooting first and asking questions later, have created favorable conditions for a bull market now and a serious sell-off later. Fed chief Greenspan has become obsessive about the risk of exuberant stock prices, Gross said. "Alan Greenspan is increasingly becoming phobic on the stock market in terms of his comments, and with some justification. It's a question for the bond market as well. Bonds these days are dominated by stocks. "Inflation increasingly is a function of the stock market," Gross, said, noting the belief that consumer spending is fueled in part by the paper wealth that many Americans enjoy in their stock portfolios. If overconfidence, not vigilance, explains the bullish stock market, all bets are off. Overconfidence, of course, can diminish vigilance. -------- chicagotribune.com Good night.