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To: Oblomov who wrote (53659)	1/3/2001 7:16:49 PM
From: pater tenebrarum	Read Replies (1) \| Respond to of 436258

true. this is an odd paragraph, and i think it's not in accordance with the theory. imo the wealth effect can't be denied, especially nowadays, with everybody in the market.

To: Oblomov who wrote (53659)	1/3/2001 8:00:27 PM
From: chic_hearne	Read Replies (1) \| Respond to of 436258

Some Random Thoughts On The Bear Case ..... 1) Every poster on SI (including the bears) thinks this is a sustainable rally. 2) EARNINGS, EARNINGS, and more EARNINGS. In two weeks, the onslaught of earnings will start. Correct me if I'm wrong, but MSFT is the only company so far that has warned out more than one quarter. There are going to be some nasty confessions about the rest of the year over the next month. 3) The dot com business model has not been solved. I think the Naz is entirely dependent on the continued buildout of the Internet. Clearly, advertising is not a means to profitability. Therefore, no amount of easing is going to get the money flowing. 4) The ISP business model has not been solved. Giving away free access doesn't work. They're going to have to start charging reasonable amounts for Internet access before the business model makes sense. This isn't possible until enough players have been wiped out and prices go up. Again, no amount of easing is going to get the money flowing in this sector until this problem is solved. 5) Reasons 3 and 4 effect many players indirectly, such as CSCO, SUNW, ORCL, and EMC. 6) In a few months, it will be clear that we are in a recession and have been for some time. 7) Quality of earnings. Just look at the big cap techs. Crisco, for example, has had 4 quarters in a row where they haven't been able to grow earnings ($.11, $.08, $.11, and $.11). But when you look at the "reported" numbers, they are showing strong growth. Of course this was from gains on speculative rummy stocks, and nothing AG can do is going to let them sell crap like RHAT for $100 a share. There's going to be a lot of tough comparisons going forward, the question is when they fess up and how much longer can they keep the game going. 8) Today's rate cut. Something is fishy. Why not at the meeting and why 1/2 point? What does the FED know that we don't? Some of the worries I have... 1) "Q4 was bad, Q1 and Q2 won't be great, but wait until the second half of the year" I'm sure we'll hear this over and over the next few months and its impact is unclear to me. 2) Today proved that the drunken speculative orgy is still in full swing with plenty of cash on the sidelines. There's no fear yet. 3) Denial of a recession or anything worse will likely remain strong. Even if "they" finally give in that a recession is going to happen, I expect them to hype that it will be short. Not sure how this will play out either. 4) More rate cuts. Not sure how these will play out. *************** That said, I think that the sentiment from EVERYONE that we rally for a while is a strong indicator we don't. The bottom line is that as expectations get lowered over the next month, the growth just will not be there to support the high P/e stocks. I'm probably going to do nothing the next few days and try and figure out a strategy over the weekend, but my initial reaction is too sell the shit out of this rally when it dies, whenever that is.