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

To: opalapril who wrote (85286)	6/25/2002 5:46:44 PM
From: augieboo	Read Replies (1) \| Respond to of 99280

Can you articulate a fundamental economic explanation, instead of a medical analogy, for the oft-repeated but never explained chestnut that a capitulation driven by fear is "needed"? To be perfectly honest, no I can't. It's just what all the old hands say. Since I don't know beans about squat yet, I take their word for it.

To: opalapril who wrote (85286)	6/25/2002 6:04:36 PM
From: Bocor	Respond to of 99280

>>If the "capitulation" theory is always intinsically true, there has to be a reasoned basis for it, even if it's only voodoo>> opal, I think it has to do with the idea that when all the selling, at least in the short term, comes together at once, it is an "exhaustion" selloff, and there are, in fact, no more sellers left. All who wanted to get out are out. That is usually reflected in the tick which at extremes can predict a market top or bottom fairly well. Obviously in times of manias, either on the upside or the downside, none of that matters, but I think it is the best explanation you are likely to get. Much of the current selling into any strength might be reflecting those big red FED CALLS and/or MARGIN CALLS appearing on many screens as investors log into their accounts daily.