Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : High Tolerance Plasticity -- Ignore unavailable to you. Want to Upgrade?

To: CpsOmis who wrote (8241)	9/19/2001 8:06:14 PM
From: chowder	Respond to of 23153

Cosmo, you and I are on the same page I think. I just posted this on the RIG board with regard to the DOW. ---------------------------------------- messages.yahoo.com Grade zero, I don't think it's possible to have a bottom yet. People are still buying the dips. We haven't seen tax selling yet by the mutual funds either. A lot of manipulation going on here as the mutual fund guys are desperate to minimize losses as redemptions are sure to impact the market during the last quarter. >> We need to remember one really important issue. Bottoms come a long time before the economy turns. (So far this has been true.) << Agreed, but when does it turn? Six months from now? A year from now? Two years from now? With CEO's still declaring no visibilty, it certainly shouldn't be in the next six months. My guess would be the economy starts to turn three months after Greenspan stops lowering interest rates. With interest rates going lower and lower, why would companies borrow money now for capital spending only to find that they could have waited and borrowed at better prices? I don't have the answers, but the above is my best guess. I do know that when RIG was at 31, I mentioned that waiting to be sure the bottom was in was the prudent thing to do. Others argued that the bottom was near with maybe a 10% downside risk. Well today RIG traded at a level that would take a 30% rise to break even if you bought at 31. We may see a near term rally, but I'm of the opinion we see new lows before the year is out. I may be wrong but when I look at a 10 year chart, the DOW isn't oversold yet. The RSI needs to go below 30 and the Stochastics below 20 in order to achieve oversold status. stockcharts.com[h,a]maclyimy[d19900101,20010919][pb20!b10!f][vc60][iut!Ub14!Uh14,3] I think we test the 7300 level of support! The NASDAQ is oversold on the Stochastics, but not the Relative Strength Indicator. stockcharts.com[h,a]maclyimy[d19900101,20010919][pb20!b10!f][vc60][iut!Ub14!Uh14,3] In my opinion, the weak economy and the outlook for the next 6-9 months causes the markets to go lower in spite of any near term rally. This is just my opinion but what the hell, even if I'm wrong, we can all learn something from it. da-grizzly-bum

To: CpsOmis who wrote (8241)	9/19/2001 8:25:40 PM
From: jim_p	Read Replies (2) \| Respond to of 23153

Cps, What you say is true, but the market is a function of supply and demand. First we have record amounts of cash on the side lines which causes the pent up demand for securities to be high. Second we also have very low interest rates and very low inflation which tends to make stocks more attractive vs. bonds. The stock market is a fraction of the size of the bond market. Next bonds have no where else to go but down, so the smart money is starting to take profits and are exiting bonds for stocks. We also have liquidity growing at record rates. Don't forget about the VIX. Stocks are very over sold here. Lower energy costs will be an incredible boost to the economy and that will be factored into the market soon. We will have an economic stimulus plan announced soon, and investors want to be in the market prior to the announcement. Stock valuations have not seen the extreme lows of prior bear market, or have they? Based on low inflation, low interest and pent up demand for stocks they may have. After today, I'm 100% invested and will be watching tomorrow with an extra large sized popcorn and an economy size box of milk duds. JMHO, Jim PS: Don't forget the locus are gone :-))) PPS: Don't be a deer staring in the head light when this market takes off.