To: Gottfried who wrote (4026 ) 7/15/2002 9:48:45 PM From: Sam Citron Read Replies (2) | Respond to It's always dangerous to trot out gurus of bear markets past, and true to form, Granville remained bearish late enough into this latest bull market to lose a considerable fortune before running out of subscribers. I was never a big fan of his, but I do believe he was correct on the divergence of the news and the market at critical junctures in the market. I think that the market for better or worse delivers a more accurate reflection of reality than the news media, which seems to be reporting yesterday's (or last Q) news and spin. True, there has until recently been improvement in leading economic indicators and somewhat dramatic improvement in orders in certain economically sensitive sectors such as semi equipment. For the last several months, however, the market has defied most analysts and trashed the recovery thesis. As we must be aware, unless we simply B&H forever, the market trumps the news, even in these days of news everywhere all the time. [Sure uniformity is tough to come by, especially these days when our sources are not confined to the headlines of the print media.] It signaled that this was no standard cyclical bear market. To accurately read what time it is on Wall Street, it seems it is not enough for an investor to recognize whether we are in a bull or bear market, but to deduce what type of bull or bear it is, i.e., the 16 month cyclical type or the 16 year secular variety. I do not think that most people are yet prepared to believe in the possibility that we are only in the third year of a sixteen year bear market as Glickenhaus, whom you cited earlier, predicted. I would use psychological jargon from grief counseling theory to explain it. First comes denial, then anger, bargaining, depression and finally acceptance, often repeated again and not necessarily in neat tidy order. For the most part, I think Wall Street is still in the denial stage. Anger wont really appear until the pink slips go out this fall and winter (and it wont be limited to a few telecom and internet analysts this time) in spite of a few early recent anecdotal references to it on the floor by Bob Pisani.
