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To: Tom Trader who wrote (40451)	2/6/2000 5:48:00 PM
From: Temple Williams	Read Replies (1) \| Respond to of 44573

Hi Tom: You asked: "What price action would it take to negate your positive outlook?" If the Spoos failed to get above 1455.00 with anything more than a throwover of a handle or two, then I would probably be jumping all over the Alternate roadmap at the site (which targets a closing of the October Cash S&Ps gap down there below 1346.49 Cash ... actually I have the first leg dropping below 1310.00 Cash). It never takes much to get me to move off one roadmap and onto another. You mentioned the market crash of '87 (I well remember all those smart kids applying for cab driver licenses after they lost their homes in the Hamptons.) I just don't see that sort of action occurring in the near-term, although "hints" have been there for ... oh ... several years, really. It will happen, of course ... but I think we get to September before it really starts to stink like a Crash. And ... yep ... the fullness of time can sure empty a lot of half-full glasses :o) If we do start running the Alternate series I suggest, I would probably be picking up a bearish "crash" series as a "next most likely" reading within a few weeks.

To: Tom Trader who wrote (40451)	2/6/2000 10:48:00 PM
From: Robert Graham	Read Replies (2) \| Respond to of 44573

Tom, I am sure much can be said about conflicting factors. But we have had two recent significant events in the market. I do not believe much else needs to be considered at this point in time. One was a reversal day on the NASDAQ, and the other was a rally before a economic report that turned out negative, yet the market continued to rally. Either one by itself would point to higher prices in the NASDAQ. Now lets see if price will hold support on the pullback that is apparently in progress, and then moves on to make new highs. This would confirm in price the positive sentiment that is quite apparent in the market right now. As far as the bonds go, I assume you are talking about the long bond. There are liquidity issues there. The government surpluses has cut demand substantially. And now they have announced a "buyback" program. So guess which direction the bond market will go? As we have seen, this direction has been up (down in the interest rate). And it will become volatile as it moves due to liquidity issues. The long bond is no longer the benchmark for interest rates. The bond to track now as the benchmark is the 10-year bond. I would think the rest of the market will follow liquidity in the bond market. Furthermore, banks are following actual interest rates that will can be more accurately gauged by the 10-year bond. What happens is first the banks will end up with decerasing revenues over the shorter term. Once they have replaced enough of their outstanding loans that were dependant on the old interest rate, they will be making money again. For that matter, I suspect as the economy slows down, that is if the Fed has its way, borrowing will increase, but this time at the new interest rates. And do not forget to consider the move of our banking industry to a model similar to the "universal" banking of Europe where they now can have fingers in other sectors that they were originally excluded from, like the brokerage business and insurance pies. But this is another topic. Just my opinion, of course. FWIW. :-) Bob Graham