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

To: jmootx who wrote (71380)	3/6/2001 12:52:52 PM
From: Bruce Brown	Read Replies (2) \| Respond to of 99985

jmootx wrote: Also on the 70's, why different today. Remember besides inflation at 6-10%, interest rates at 10%, etc. etc. stocks were more components of dividends...yields needed to be 3-5%. The 1990's saw the demise of dividends, so the old PE standard is gone for good. Bingo! Yields have dropped as the dividends 'contracted' and this has been reflected in the average PE advancement. In addition, accounting changes have also been a part of the PE advance. So when we compare historical PE's, all of this needs to be factored in so we know when and what we are comparing. The sad thing is that I have a link to the historical PE and dividend yield information on my Netscape Browser, but each time I try to launch it the thing crashes. So I'm using IE at the moment and don't have the link available. As soon as I get Communicator up and running, I will submit the link. BB

To: jmootx who wrote (71380)	3/7/2001 3:08:37 AM
From: Psycho-Social	Read Replies (2) \| Respond to of 99985

2001 vs the mid-70's: The demographic patterns are different today, although there are some reasons to worry about coming years. In the mid-70's, the Depression era group was reaching its 40's, and there just weren't enough of them to keep the Market up. The much larger group of WWI era Boomers were hitting 60 at the same time. Additionally, once the negative momentum developed and the Depression era babies saw that they couldn't win in the Market, levels of stock ownership declined as well, aggravating the imbalance. Based on Harry Dent's charts and my own demographic analysis, I believe this period is comparable to 1963, although I'm not saying we'll follow each twist and turn of that period. I'm just saying we're in the late innings, but have one or two bull markets left before the Baby Boomers start to cash in their chips in a major way, and overwhelm demand for stock from the Vietnam War era babies.