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

To: bobby beara who wrote (68420)	2/2/2001 10:57:14 PM
From: marginmike	Read Replies (1) \| Respond to of 99985

other then shorts whats to buy????

To: bobby beara who wrote (68420)	2/2/2001 11:15:02 PM
From: Zeev Hed	Respond to of 99985

Bobby, all I can do is reiterate my long standing opinion, we are in for a very extended period similar to the 1966 to 1982 where the average are locked in a wide trading range (I have 6000 to 13,500 on the Dow and 1900 to 5300 on the Naz, I may have to lower the lower part of the last range, but for now, that is where it is). Even if the current rate cutting is successful in reviving consumer confidence and as result end aggregate demand, it will rapidly be dissipated, IMHO, and followed more rapidly than before (particularly if too great a tax cut is implemented, IMHO). There are structural problems that will take a long time to "repair", including, of course, excessive valuation (the S&P is still about twice as high as it would be at a real bottom in a bear market relative to its earnings), excessive debt, and intrinsic weakness in Asia. In 1998 we came to Asia rescue by increasing our trade imbalances to 4% of GDP (from under 1.5%), we surely cannot go much higher than that without causing the dollar to plummet, inflation to rise, and the subsequent problems these entail. Having said that, I do not think we go into an "attrocious" single spin, but more into a wildly oscillating market (manic /depressive), thus for the next few years, the most important things will be to know when not to stand in front of a freight train (g). I strongly believe that 11% average rise, or even 5% average rise over the next five years is out of the question. Zeev