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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: tradermike_1999 who wrote (16552)	3/7/2002 9:21:05 PM
From: westpacific	Respond to of 74559

Lets see, at the end of the bull markets of the industrial revolution and everyother 'revolution' in the history of the stock market - at the bottom of the hype cycle the dividend yield was 5 to 6%. Right now we are at 1 to 1 1/2%. So I guess the computer revolution will change all history and make the economic cycle wiped out - as Greenspunk wants everyone to believe. Keep living in fairy land folks. No one wants to credit $1 TRILLION in M2 and M3 Fiat Money or 4.75% in FED MANIPULATION. NO the computer did it, DUH.

To: tradermike_1999 who wrote (16552)	3/7/2002 11:03:12 PM
From: AC Flyer	Read Replies (1) \| Respond to of 74559

>>Uh, ok. Let's see the agricultural revolution created modern civilization, and we all know how important the industrial revolution is. So you really believe that the computer and the internet are as important as these two events?<< Yes, I do. >>Is that why you think stock valuations don't matter?<< This is your black and white characterization of the bull's case. However, I have never said this. Show me a post where I made this statement. Of course stock valuations matter. The stock market is a discounting mechanism. The market discounts the future earnings of individual companies/stocks. Right now, the discount rate is very low, thanks to Uncle Al. However, the market is also telling us, right now, that "it" thinks future earnings are going to be pretty damn good. The market may be wrong. We shall see. >>Unlike the stock peaks in valuation and bear markets in the 1880's, 1920's, late 1960's - this time the technology is so super that regular economic and historical valuation trends in the market no longer matter?<< This is 100% your statement, not mine. I never said any of this. If you disagree, show me. >>Just want to make sure I understand where you are coming from?<< You seem to be projecting your own bias onto me rather than trying to understand where I am coming from. >>No need to say that I strongly disagree here<< OK. >>and think it is a desperate rationalization to believe in the market no matter what.<< Again, where did I make anything like this statement? This is what I believe about the market, right now. Index P/Es are high but companies with solid balance sheets, good cash flow and cheap stocks can still be found (e.g. WM, AT&T). Many of the high P/E stocks will either (a) stagnate for years or (b) take a further beating. However, some of them - the winning companies, whose people really do "get it" this time around - will be breathtaking winners. Where we really differ, I think, is that I believe that there will be a resurgence in the real economy, starting right now, driven by (a) boomer demographics and (b) productivity that will wash away all the short term concerns and allow quite extraordinary future stock market gains. You believe, if you will excuse me for putting words into your mouth, that current high levels of indebtedness must be washed out in some kind of stock market and economic capitulation/collapse. I do not. The market is either discounting very strong future earnings or is totally out of touch with reality. Somebody is going to wind up shut out of the game.