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To: yard_man who wrote (145930)	1/24/2002 1:36:44 PM
From: GraceZ	Read Replies (1) \| Respond to of 436258

Even while traders move shares around and contribute most to the daily volume its the mutual funds that own and hold most of the shares. MUFUs are made up of a zillion little people and while some of them only look at their statements quarterly and have been soundly educated to hold for the long term and continue to invest through downturns, they are at a critical juncture here. Some people are looking at their accounts drop in assets cutting into their principle contributions and not just losing their gains. This is the point where little guys swear off the market. MUFUs will have no choice but to sell to meet redemptions if these little guys cut and run. Traders for the most part don't care about the direction, up or down they will play the market where ever it goes. While we saw some strong block buying on Wednesday at the lows, yesterday's rally was marked by strong block selling as were the rallies last week. I haven't looked yet today at the flows but it I would fully expect the blocks to continue to be negative today. Its called distribution. Who's buying? Traders who don't intend to hold and little guys who will cut and run as soon as they realize they are left holding the bag. The sand has been run out underneath of this rally. When the funds exit it creates a situation where there is no foundation of holders underneath the marginal action that moves price. All it takes is someone shouting fire to get the downside rolling in this situation.

To: yard_man who wrote (145930)	1/24/2002 1:37:47 PM
From: reaper	Read Replies (1) \| Respond to of 436258

Tip, check the TrimTabs site for some stats. J6P equity mutual fund flows were: 1996 $211.5 billion 1997 $182.5 1998 $159.2 1999 $180.5 2000 $245.0 2001 ~ $60.0 trimtabs.com New buybacks have averaged $18 billion / month over the last couple of years. Cash takeovers have averaged $15 billion / month over the last couple of years. trimtabs.com So corporate free cash generation / use is at least as important as J6P, if not more. Pension funds (which J6P obviously benefits from but doesn't really "control") hold +/- $3 trillion in US equities. So just a small re-balancing one way or the other by these guys makes a huge difference (in fact, in the TrimTabs article referenced above, they think pensions bought new $90 billion of US equities in the Q4:01, more than the inflows from J6P all year). I am sorry that I do not have a link for foreign buyers. I THINK it has been on the order of $50-100 billion a year for the last couple of years. Hope that helps. Cheers