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Strategies & Market Trends : Classic TA Workplace -- Ignore unavailable to you. Want to Upgrade?

To: Perspective who wrote (6775)	7/11/2001 7:59:57 AM
From: AllansAlias	Respond to of 209892

Good post and good to have you back. Your reminders on bear market mechanics are worthy of repeating every few weeks to keep us focussed on the bigger view. BTW, thanks for wiring me this paragraph from the Pacific for my June 3 posting on the Brafoo page -g: I would like to start by commenting on the bigger picture. I think that the level of complacency right now is too high and I can only imagine what will happen if equities continue their run. Bulls think it's 1998 again ("We're going to the moon.") and many bears have been shaken by the stunning rally off the late March (non-tech) and early April (tech) lows and view the recent pullback as little more than a buying opportunity. The market is not discounting the rare and extreme risks we face. Price/earnings ratios are skyhigh. Mutual fund managers are more bullish than ever before. Sentiment indicators are are back in bearish territory near the levels we say at the Jan-Feb/2001 top. Wall Street strategists are far too bullish, recommending a 71% allocation to equities -- very near an all-time high. Company insiders are still selling with vigor into every rise. The smart money, commercial traders, are in no rush to cover their net short positions. Perhaps I place too high a premium on fear, but I believe that this is no time to be increasing one's exposure to equities for the long-run. I will not bother to rehash all the arguments yet again. Suffice to say that while I do not consider myself a permabear, I do not buy into the "new bull" argument for a second. The #1 reason that equities might rise further is the staggering level of money printing and the aggressive rate cuts. These are not a cure for what ails us. There are more like a radical treatment program whose side-effects could seriously harm the patient.