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Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: James Calladine who wrote (84444)	6/24/2002 6:38:46 PM
From: Zeev Hed	Read Replies (3) \| Respond to of 99280

Jim, for a variety of reason, the "window" for a good bottom closes around July 2nd (external news event can always change that, as well as internal dynamics of the market), thus it quit possible we do not get a good bottom, If we don't that would quite "disastrous" (to us longs), since any rally without such a "good bottom" would be short lived an would not carry very far (a poor bottom may result in less than a 200 Naz run, followed by more grinding down). The next four to six trading days could very well produce the sentiment indicators necessary, if they do not, I would probably go to only 50% to 60% exposure rather than the 80% plus. A poor rally following a poor bottom may not be worth playing (ro many air pockets will be present, like the recent pockets in RDRT and OAKT). All I can do is "listen" to the market and try and fathom what its intentions are, if these are not "honorable"....(g). Zeev

To: James Calladine who wrote (84444)	6/24/2002 7:30:26 PM
From: Earlie	Read Replies (2) \| Respond to of 99280

James: I am not a technician, but the market's fundamentals sure as heck suggest that we have a very long way to fall before a true bottom arrives. Most folk don't like to think about it, but IMHO, the best comparisons for deciding where we are and where we are going, can be found by examining both the fundamentals and the parallel market actions of 1929-32. There are, of course, differences but unfortunately most suggest that this time around, things are much worse. Just for starters, the U.S. was the world's largest creditor nation back then. Today, it is the world's largest debtor nation. As well, corporations "saw it coming" in the late twenties and raised tons of dough, so they entered the bleak period cashed up. Today, most U.S. corporations are loaded to the gills with debt, much of which is becoming unserviceable due to the profits implosion of the last two years. Whether the market does a "reverse triple in the pike position", or merely abrades investors' body parts, one by one, via a dreary "grind-down", we will know soon enough.. What is there for all to see are the remarkably ugly economic realities that point to a relentless deflationary wave just entering our harbour. Either way, plenty of investors are going to be drowned before it recedes. That is not to suggest that there will be no successful stocks during this nasty period. Again, history suggests the opposite,... that there are indeed companies that "do well in bad times". As I am an optimist, I will continue to hunt for them and invest in them when identified. But I also don't see much value in fighting the trend, which is now, powerfully bearish. Given this fact, shorting makes common sense, particularly when history also suggests that the decline of bubble stock prices occurs over much shorter time periods than was required to accumulate the preceding excesses. Bluntly, the risk/reward ratio now heavily favours Darth Vader tactics. I will know a true bottom is in when every person I know hates the very word "stock" or "invest" and has vowed that he will never invest again during his lifetime. At that point, I will buy more generically and with less discrimination. Best, Earlie