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Technology Stocks : JDS Uniphase (JDSU) -- Ignore unavailable to you. Want to Upgrade?

To: Gut Trader who wrote (9364)	4/22/2000 9:42:00 AM
From: Hank Stamper	Read Replies (4) \| Respond to of 24042

Thanks for the thoughtful responses. (The others too!) "If we are in a healthy economy, and for the most part, we are, markets should not crash." We are in a very healthy economy--full employment in the States and very strong growth in almost all of the rest of the world economy. (Even Russia repoted recently that their economy is experiencing a healthy revival.) However, it should be pointed out that bear markets and econconic slow-downs often (not always, though) arise out of the current economic conditions. This works as a classic feedback loop. For example, rising compensation costs 'cause' employers have to pay more to hire/retain which 'causes'lower corporate profits and higher inflation. (Recent strong increases in productivity have not outstripped rising compensation costs.) The stock market is a leading indicator of the economy. The markets typically peak 6 or more months prior to the economy. Because of this, people have a hard time believing that the party is over. It's a trap, I reckon. In economic and stock market history there are many examples. In November 1968, the market peaked but the business cycle peaked In December of 1969. Bear market followed. In December of 1972 the markets peaked but the busyness cycle peaked 11 months later in November of 1973 which resulted in a 40% decline in the S&P500. (The S&P500 is a proxy measure for all stocks since it holds about 80% of the market cap of US stocks.) With all best wishes, David Todtman