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To: the_wheel who wrote (160757)	4/18/2002 12:01:30 PM
From: clochard	Read Replies (2) \| Respond to of 436258

Why did the market just drop?

To: the_wheel who wrote (160757)	4/18/2002 12:48:03 PM
From: GraceZ	Respond to of 436258

Money Funds are dropping as evident in the slowing in the M2 and MZM. I would guess that the smart money is already leaving real estate while the public still chases it. Not too many people are investing in PG DL WMT etc, the stocks are going up yes as well as the PMs but there is no mad rush to buy as well as no need to sell. Well if that's what "people" are doing its a good thing that most of the people don't control most of the money. The money flow into WMT has been even stronger than its price would indicate, a straight ramp up. While some over owned, over blown stocks like GE, IBM and AOL have been experiencing negative money flow for months, the consumer stocks have had almost unabated positive flow. Only in the last month or so has the NYSE slowed down after being net flow positive for two years or so. Now the Naz is experiencing the largest divergence of price to money flow in the history of the market (although rallies see it reverse out). I would venture to guess that the flow into gold and gold producers is just above negative and amounts to a rounding error on something like GE or WMT. While people in general hate stocks these days, they have automatic investment in their 401ks and pension plans, I talk to very few who have moved all their funds to the mm. The mutual fund industry is set up so that they have to be invested to a certain percentage, so money flows in regardless of what price is doing. For the most part J6P is getting out of individual stocks and putting it in mutual funds or into houses as you pointed out. Price is never a good indication of where money is going. If we learned nothing else from the bubble of 1998-2000 it would be that price can be elevated with nothing inside supporting it. What might not be so apparent is the inverse, that money can flow in while price continues to fall.