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Strategies & Market Trends : Stock Attack II - A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Teresa Lo who wrote (15791)	8/19/2001 7:10:57 AM
From: PMG	Respond to of 52237

my theories why going down takes its time: - People need time to learn responses to altered conditions (that's a systemic approach) - Selling will indeed not continue on even worse expectations but on 'real' pressure like drawing savings to meet reduced work income. - There are some balance sheets for which there will be some 'moment of truth' in the future when the deterioations of finacial asset values can no longer be hidden. This will probably cause some unexpected defaults and liquidation of more assets. - Real estate prices should fall. This will put even more selling pressure on re as some mortgages will be drawn. The consequences are clear. - When the economy has stalled because of misinvestment you cannot go on and repeat the same ideas that did not work any longer. People have to lean back, think, and spot new fields of business that meet demand in a better way. This takes some time, naturally. - Re-evaluation of currencies will be harmful to anyone short term (structural changes) though it's a long term positive. PMG

To: Teresa Lo who wrote (15791)	8/19/2001 9:25:43 AM
From: Captain Jack	Read Replies (1) \| Respond to of 52237

No it has not gone down with a 'big whump'. About all the weak hands could be gone by the slow bleed of 18 months. Some could have rushed back,, and out again a couple times. Bottom,, do not count on it-- going down,, certainly do not count on that either,,, of all the stuff I read on WHY it is going down about 15% makes sense. The rest is from those hoping not to cover yet..

To: Teresa Lo who wrote (15791)	8/19/2001 10:06:39 AM
From: Rarebird	Read Replies (1) \| Respond to of 52237

<What are they waiting for? An invitation?> The vast majority of investors have been trained by the financial media and their mutual fund advisers to dollar cost average each month in the stock market in order to become rich when they reach retirement age. The conventional wisdom is that it takes 6-9 months for an economic recovery to begin once Fed Easing takes hold. So, I think there is still a lot of hope around for better times ahead. I think your psychological analysis is valid in a Bull Market, where a " Wall Of Worry" is overcome. What I see, on the other hand, is a Bear Market, filled with the "Slippery Slope of Hope," that business conditions will improve, while all the fundamentals point to lower lows. Hope, along with greed, are very powerful emotions. It's not easy for people to give up hope that the stock market will recover in a few years. I'm not saying that there won't be cyclical bull rallies along the way. But I think that we are in a secular bear market here, which will last at least till the second half of this decade. I think Ford's earnings warning on Friday was quite significant. These markets were informed that the consumer is now cutting back on spending in a big way.

To: Teresa Lo who wrote (15791)	8/19/2001 11:30:57 AM
From: Jack T. Pearson	Read Replies (1) \| Respond to of 52237

The world ends not in a "whump," but a whimper.

To: Teresa Lo who wrote (15791)	8/19/2001 6:16:42 PM
From: sea_biscuit	Respond to of 52237

Well, if people are so sure now that it is going to continue down, why do they have so much in equities? If the mutual funds think so, why do they have such low cash levels? If the newsletter writers think so, then why are so many of them making bullish comments? The fact is that some people are pretending to be bearish, while still remaining invested, in the fond hope that all their bearish talk will somehow work its magic and spawn a bull market! Don't look at what people say, look at what they do. Their portfolios are still based on the assumption that 1999 was no aberration and will repeat itself next year. What are people waiting for? They are waiting for the next leg up. They don't want to miss the EXPLOSIVE rally of the next bull-market, which of course, is just around the corner. They don't want to look like fools, holding cash when the Nasdaq starts rocketing up again! And yes, this darn thing is not going to go down with a big whump, it is going to trend down for years and end sometime when Time or Business Week or Newsweek writes a story about the death of the stock-market AND really mean it as well!