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.

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

To: AC Flyer who wrote (20114)	6/21/2002 3:58:31 PM
From: Snowshoe	Read Replies (2) \| Respond to of 74559

>>I believe we get one more leg in this wondrous bull, through about 2008 or 2009<< AC, are you not at all worried about the DOW 10,000 curse?... Next, what about the possible curse of the logarithmic numbers: 100, 1000, 10,000? The following statistics come from a thought provoking article by Peter Eliades (always one of my favorite financial writers) in the March 22, 1999 Barrons article, "Nasty Numbers". The DOW first breached 100 on January 12, 1906. It took nearly 19 years to get significantly past it. Nineteen years! In between, the DOW declined 48.5 percent to a November, 1907 low, came back in 1909 and hovered there until 1912 when it slid down 30 percent by 1914. In November, 1916 it was 110 then it declined 40 percent in 13 months. In November, 1919, it was 119.62. By 1921 it was off 46.6 percent. Finally, a bull market began in 1924 that carried it to 381.17 on September 3, 1929. We all know what happened at that point. Ouch! In January, 1966 the DOW broke 1000 intra-day. Then it declined 26 percent. By December, 1968 it hit 994.65. From that point to October, 1974, the average share price declined 75 percent. Ouch again! The DOW continued to flirt with level 1000 back and forth until August, 1982. That’s merely 16 years of going nowhere. By the way, 1982 is when the headlines screamed, "Equities Are Dead" just before the greatest Bull Market in history! Is conventional wisdom always wrong? On February 24, 1983, the DOW closed at 1121.81 and the greatest Bull Market in history was off and running. It had only taken 17 years to get through the 1000 barrier curse. Will 10,000 prove to be a curse number? Did I forget to mention the possible effect of the Y2K problem? How do we cope with the possible consequence of terrible thoughts and nasty numbers? One way is to utter those words that my hero, Sir John Templeton, said would be the most expensive words you will ever utter: "It’s Different This Time." physiciansnews.com

To: AC Flyer who wrote (20114)	6/21/2002 8:28:44 PM
From: TobagoJack	Read Replies (1) \| Respond to of 74559

Hi ACF Mike, you do not seriously want to experiment with money and wealth to any extent commensurate with your conviction, the potential upside is not worth it and the imagined advantage is just that. Repent now before it is too late. The managers playing with your money are thinking thus, while fondling themselves: prudentbear.com QUOTE Merrill Lynch’s recent survey of portfolio managers indicates that US equities have lost their luster. Not only do more fund managers think that the earnings outlook is worse than it was a month ago, but more managers view the quality of earnings with a jaundice eye. Merrill’s recent survey shows 51% of fund managers would prefer to underweight US equities. This compares to 40% last month and only 29% in March. Potentially equally alarming, 30% view the US as having the worst quality of earnings in terms of volatility, predictability and transparency. The US was second only to Japan. Some details of the US respondents taking the survey: · 97% expect corporate profit growth in improve. None expect profits to deteriorate. · Almost 30% believe global earnings per share will increase more than 10%. · Increasing sales (51%) and lower costs (39%) are believed to be the two biggest drivers of global earnings growth. Ironically, 73% of respondents forecast that industrial commodity prices will be higher in 12 months. · The repayment of debt is the most important use of company cash flow, according to 49% of respondents. Repurchasing equity is a distant second at 21%. · 66% expect global core consumer inflation will be higher in twelve months, with 5% indicating “a lot higher”. Not surprisingly, 93% see global short-term rates higher in 12 months. With 10% saying “a lot higher.” · Valuations appear about right. 44% of managers believe global equities are fairly valued, with 20% seeing equities overvalued and 34% undervalued. The outlook for the next 12 months is also balanced: 17% of respondents think equities will get more overvalued, and a similar 17% believe equities will become more undervalued. · 24% indicated that cash positions were currently overweighted versus 7% being underweighted. 23% have zero cash, with another 23% holding 4% or less. · In 12 months, 80% of fund managers believe world stock markets will be higher, 24% expecting double digit gains. Economic-sensitive sectors are the favorite among 71%. More than half expect equities will outperform bonds. · If the market fell 10%, 71% would be buyers and only 2% indicated they would be sellers. But if equities rose 10%, 32% would sell into the strength and 15% would continue buying. · Managers are more risk averse. 22% have a lower level of risk in there portfolio, with only 7% having a higher than normal risk level. Yet, managers are more inclined to increase (34%) the level of risk over the next year; only 5% intend to reduce risk. Additionally, managers are working with a shorter time horizon. 29% report their time horizon is shorter than normal, with 7% indicting its longer. Outside the US, a few outliers include: · 73% of South African mangers view the market overvalued. Appropriately 67% report that they are overweight cash and 67% have 10% or greater amount in cash. · Europe is considered by the most to be undervalued. Forty-eight percent of UK respondents viewing markets undervalued. Forty-one percent from Eurozone feel the markets are undervalued. Survey questions comparing how regional managers view different regions yield some interesting results · 54% of Japanese managers view Japan as the region with the most favorable outlook for corporate profits. As a group Japan was cited by only 16% of the managers. · 27% of the US managers think the US is the best place for corporate profit growth, but received only 19% of the vote by the group at large. · Emerging markets are the runaway leader with 39% of respondents. · US was voted the least favorable by the group – 32% · US is also the most overvalued – 60%. Only 9% see the US as the most undervalued. · 65% view the dollar as overvalued, even 51% of US managers. 66% view the euro as undervalued · Only 24% of all respondents expect assets to return 8% or more over the next decade, only 3% expect double-digit returns. · On a global scale respondents are underweight technology and telecom, overweight financials, basic materials, and general industrials. UNQUOTE Chugs, Jay