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

To: Zeev Hed who wrote (91912)	7/6/2002 12:06:29 PM
From: michael97123	Read Replies (1) \| Respond to of 99280

Re post 91909 and 91912. 12 seems to me to warn of long bear period yet to come. 09 talks of a final flush in nassacre with 3rd quarter rally. Which do you think is more likely? Or is it a combination of the two that you are predicting? mike

To: Zeev Hed who wrote (91912)	7/8/2002 5:00:36 AM
From: limtex	Read Replies (1) \| Respond to of 99280

ZH - Well everyone keeps referring to this 66-82 period. But this was a very odd period indeed and simply bears no colorable relationship to the situation today. Why? 1. Soviet Union replaced by an incipient capitalist Russia. This is a double second being the first time in history that Russia has been free and capitalist. Incidentally I know personally many people now going to Russia to do business for their companies. This is not like ten years ago when I first started goign there. This new wave is different and the legal situation is gradully becoming workable. 2. Same sort of thing for China but much more so. The Chinese are the greatest capitalists in history. That is probably so becasue they are the greatest gamblers! They are alos among the mosat intelelectaully brilliant if not the most. Go to any graduation ceremony in the US and see who gets the honors. The difference here is that China is almost an entire World on its own. Go see how keen the are to learn English even in small provincial towns. To see how keen these yuong people are just to be able to string a sentance together tlaking to you on the street it is impossible to keep a dry eye. They have so little and all they want is to be able to speak English, because then they can get on in life because English is the language of business and these people can't wait to get into business. 3. In the late 60s andearly 70s we had the unpleasnat pehenomenon of OPEC. Follwing the Yom Kippur War whole economies in the West almost went bust. Britain had no electricity for three days a week and they had a banking clooapse that the Bank of England had to create the "Lifeboat" to help stabilize the entire Biritsh financial system. This was an actual calamity of proportions that makes todays problems look like a walk in the park. There was inflation at the highest levels the West has ever known and the Cold War was in full swing. 4. The tech revolution hadn't started. The tech revolution has now just started and it is getting stronger. As a techie I am just amazed at what we have coming down the line. More goodies every year to save lives, make things more efficient learn more effieciently. I can't think of anything in the 66-82 period that is remotely similar to today. Best, L

To: Zeev Hed who wrote (91912)	7/9/2002 2:48:43 PM
From: chomolungma	Respond to of 99280

Zeev, We started the 82 period with stocks extremely undervalued, and then went to extreme over valuations in early 2000. We are still in the area of overvaluation here, and earning will have to grow by quite a lot to justify current valuations. You got to accept the fact that we are only in the third inning of this secular bear market, which will, eventually, bring stocks to extreme under valuations. I agree that we began the period in question with stocks extremely undervalued and ended in a period of extreme overvaluation. But the big period of undervaluation occurred primarily because of economic reasons. During the mid to late 70's, the U.S. economy was in the grips of stagflation and interest rates were magnitudes higher than they are today. I think a prediction of extreme undervaluation must assume a dire economic background. Maybe you are predicting such but absent that, I believe we are closer to "fair value" than you give credit for.