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

To: bobby beara who wrote (43653)	3/20/2000 2:53:00 PM
From: Crimson Ghost	Read Replies (1) \| Respond to of 99985

Another bear bites the dust (sort of) Shepler Capital Management: March 20 - March 24, 2000 Another Bear Bites the Dust! Well, I am happy to inform our bearishly inclined readership that I am personally about to hammer down another nail into the coffin of this record shattering bull market. They old axiom on Wall St. is that the bull market is dead when the last bear is either converted or just plain disappears. Well, I am certainly not converted to a bull (not a chance!), and I am not about to disappear, but I am planning to take a temporary hiatus from my weekly updates. Now I know that this announcement will likely bring joy to the gloating and cocky bulls, and while the bears may miss my commentary, they should take heart in that my hiatus may very well turn out to be a contrarian signal that this bulls has seen its last days. Of course, it will be a shame for me not to have the chance to gloat and say "I told you so!" via my weekly updates when this bubble finally pops. But, unfortunately time constraints and other priorities have gotten in the way of my weekly missives of late. And, I would be less than truthful if I did not admit that it has grown somewhat tiresome to say the same thing week after week only to be confounded by a mania that has extended beyond my wildest imagination. I feel that my weekly updates are becoming somewhat repetitive and no longer really adding value. I would however be happy to continue to provide updates on a monthly basis, that is if George is still interested in posting them [Hell YES! - GU], and if readers are still interested in hearing my viewpoints [Hell YES! - GU]. Finally, I would like to thank all the readers of urbansurivial.com who sent me feeback on my column, and would like to extend a debt of gratitude to George Ure who provided me this forum and has been a great partner on this collaborative effort to bring our readers a different perspective on the markets than what the mainstream media provides. Now on to the markets: Expiration week certainly turned out to be a wild ride this week, as the once mighty tech bubble let out a little hot air, dropping nearly 15% on an intraday basis in a mere 3 days. This was just a preview of the kind of swift destruction of wealth that the Nasdaq bubble will be subject to, and it reinforces my point that it will be better to be out of tech a month early than a week late. Meanwhile, the game of musical chairs continues, as all this funny money that "Bubble Boy" Greenspan has created (or allowed to be created) sloshes from one sector to another. So, even as a tech wreck was underway, the Dow was soaring higher, setting a new record on Thursday for its largest point gain in history. This type of frantic rotation will continue until "Bubble Boy" Greenspan finally decides to manage the money supply with some shred of integrity. To date this does not appear likely. Despite all this tough talk and the interest rate hikes, the Fed continues to sit idly by while credit is created at an alarming pace. So Nero fiddles while Rome burns. In fact the Fed at times seems to be encouraging the expansion of this credit bubble, which means that Nero is not just fiddling but is pouring gasoline on the fire. The talking heads are right when they claim that this bull market is all about liquidity. And the bureaucrats in D.C. have decided that the bull is too big to fail. So, the printing presses keep rolling, the credit bubble kepps expanding, and the herd keeps pouring their nest eggs into this government sanctioned (sponsored?) ponzi scheme. This house of cards looks very stable until a stiff breeze blows it down. In my opinion, the day that foreign governments cease to be willing to finance our ever increasing trade defecit is the day that the house of card comes crashing down. The reason is that such an outflow of foreign capital will tie the hands of "Bubble Boy" Greenspan to turn on his printing presses for fear of further eroding the US dollar. Until next months update, I would advise keeping a very close eye on the US dollar and the balance of trade data. Any sustained weakness in the greenback would suggest that the capital outflows are already beginning and that bull market is in dire straits. Click here to send email to --> Bill Shepler