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To: Terry Whitman who wrote (150055)	2/8/2002 1:03:04 PM
From: pater tenebrarum	Read Replies (2) \| Respond to of 436258

well, the point about the WS strategists is that their weighting has risen throughout the bear market. it was already historically high when it began, and went into completely silly territory on the way down. at the low, it will be at least 25 - 30% below current levels judging from the indicator's history. also: mutual fund cash levels are at their lowest point since August of 2000 (below 5%), and corporate insiders are selling in droves. that imo means that upside will be limited. Japan might implode, at which point people WILL care. consider the data presented in this article: forbes.com RECOGNITION is coming there too. regarding inflation,i disagree. imo we're in a deflationary era. those price rises you cite actually have the opposite effect to that normally expected in a deflationary era: as they concern mostly necessities, or governmental extortion, they lead to a drop in spending elsewhere, intensifying the deflationary pressures on the overall economy. i said the same thing about high oil prices in 2000, and have been proven right so far. ECRI's future inflation gauge has convincingly broken below both its '98 and '94 lows and debt is imploding faster than the Fed can print up new money. we just had two back-to-back record months in corporate bond defaults, and C&I lending and commercial paper markets have been in steep decline for over a year, all hallmarks of a deflationary period. regarding the miners, sure, they will correct at some point. when wave 3 up ends. and note that we have a bona fide break-out in gold which nobody appears to believe can be sustained. however, i do expect that the metal will fall back into the 270 - 300 trading range one more time before the rally really gets going. that's because we are building a fractal of the '85 bottom, and so far the market is perfectly following that template. that correction should be swift and painful, no doubt about it. look at it as the last chance to get aboard. :)