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To: Bill Harmond who wrote (12870)	7/19/2002 6:47:52 PM
From: stockman_scott	Respond to of 57684

Commentary For Friday's Market Henry Ford Pitbull Investor Thursday Evening July 18th, 2002 Once again the abject fear in the marketplace froze investors as good news is discounted and unfounded fears affect investor psychology. The DOW and the SP 500 futures suffered setbacks, but did manage to stay above weekly support. Looking at an hourly chart of the NASDAQ over the last three days, it made the third higher-high and higher-low..ending up as the most bullish of the indices despited negative earnings on a couple of belwhether stocks. NASDAQ DOW and SP all ended on support lines for options expirations tomorrow. I am sure at this point some of you are saying what in the world is there to be bullish about or look for ANY improvement in the markets? ....and once again we saw 135 stocks reporting today in the SP500 with 119 meeting or beating the street and only 16 who didn't match expectations. THIS IS THE BEEF and at some point these folks are going to get the message and start buying the reality. Warren Buffett plunked down a cool bet of 100 mil on telcom this week when the rest of us are doing our best to bury it.......A wise man once said "FEAR IS THE DARKROOM WHERE NEGATIVES DEVELOP" I really find it hard and painful (despite my ever increasing bullish attitude).... to watch day after day for the last few weeks as investors bail and pull their mutual funds out, but I have lived through a few of these. I have to admit this is the worst one psychologically, because of the slow grinding nature as we try to set a bottom, but this is the way good bottoms are formed. It IS painful...but it is equally painful to be left out when things suddenly and seemingly inexplicably turn and leave most in the dust. The VIX Volatility Index) stayed under the upper bollinger Band again today. For the first time in two weeks we got 2 days in a row, and like a rubber band that is stretched too far it has to snap back...when it does it will be violent and profitable for those on board. This "Fear" gauge needs to drop under 36.90 to get the bears covering their tracks. We ended at 39.95 this evening. Can we still go lower...of course, but the downside appears to be limited a lot more than the upside. 8235 is a much talked about area for retesting the DOW, but much more likely, if we do go back down, would be to make a double bottom at Monday's lows. Once the S&P gets over 936.50 I believe the bears will be pressured to cover their shorts, and over the ensuing couple of days we could actually see a buying panic to match the selling panic we saw today. That's all for now...keep an ear and an eye on this weeks market action. I truly believe this is the time for opportunity. << 4:03 PM Friday July 19th UPDATE: Took out 8000 by a good bit then rallied back... Monday will be exciting methinks....Too hard to call right now, but two scenarios leap to mind: 1. Panic gap down on the open followed by rally into the close 2. Orderly rally from the open. After everyone gets home tonight and turns on their computers or hears the news they will have all weekend to worry about what instructions to give their brokers Monday morning....Without more input I would guess on scenario 1, but we will wait to see,,,In any event we are getting some great bargains here and believe 60 days from now we are going to be pretty happy campers. Nobody is going to call the bottom to the day, but if you you aren't invested you can't participate..... All of the issues we tossed out this morning held up very well through the selloff in the afternoon.

To: Bill Harmond who wrote (12870)	7/19/2002 8:00:57 PM
From: stockman_scott	Respond to of 57684

Fear, Loathing and Monday's Open By Matthew Goldstein Senior Writer TheStreet.com 07/19/2002 06:21 PM EDT It was an ugly Friday on Wall Street. It could get uglier on Monday, especially because investors, traders and fund managers have the weekend to sit and stew. Obviously, no knows what will happen when trading resumes. And no one really knows whether Friday will finally be the much talked about but illusive thing called capitulation -- that one cataclysmic day of selling that finally slays the market bear. The trouble is, we're in uncharted waters right now. Yes, valuations are still high on a goodly number of stocks, but what's driving this market right now isn't a concern about stock prices -- it's a fear about the numbers company's report. It's a complete breakdown of investor trust in Corporate America and Wall Street. Indeed, it's not just fear that's driving investors, but utter distrust. And that's something that won't disappear over a weekend, or even a few days. Lack of Precedent "There's nothing common about what is going on," says Harold Schroeder, a portfolio manager for Carlson Capital, a Dallas-based hedge fund. "We have lost tremendous confidence in major institutions. And without confidence you have trouble investing in stocks. We've thrown fundamental analysis out the window." If you're looking to history as a guide for Monday's stock action, the best place to turn is to the October 1987 crash. The infamous Black Monday selloff in 1987, when the Dow Jones Industrials fell some 22% on Oct. 19, was preceded by a 5% drop in the Dow Jones the previous Friday. For the entire week before Black Monday, the blue-chip index fell just over 9%. And there are some parallels to today's sickening market action. Friday's 390-point tumble in the Dow translates into a 4.64% drop. For the week the Dow lost 7.7% of its value. Past Performance, Future Results But markets don't necessarily do what history predicts. Remember how everyone said at the beginning of this year that a third-straight down year for the major market indices would be unprecedented? Well, we're certainly heading in that direction. And the problem is that telling investors stocks are cheap is not going to get them to buy, at least not right now. "There is a disconnect between fundamentals and the stock market and stock prices," says Timothy Ghriskey, president of Ghriskey Capital Management, a Connecticut-based hedge fund. "My gut is we're in for some stabilization on Monday, but I've been looking for a bear market rally for a while." One thing that won't help the market stabilize are things that breed more distrust. That's what one institutional trader said he saw happen on Wall Street just before the close Friday. The trader, who didn't want to be named, said specialists -- the firms that manage trading on the New York Stock Exchange -- were artificially trying to prop up in a handful of stocks that were being added Friday evening to the S&P 500. He acknowledged, however, he was holding short positions in some of those stocks. The Little Guy Factor What ultimately will tell the tale on Monday is how ordinary investors react to Friday's selloff. If investors view Friday as just another in a long string of bad days for Wall Street, Monday could be rather uneventful; indeed, stocks could rebound as investors smell a buying opportunity. Or investors might conclude that it's finally time to throw in the towel on some of the clunkers they're still holding in their portfolios from the glory days of the bull market. "This is clearly mostly emotion," says David Kaslow, senior portfolio manager for Bank of America Capital Management's Nations Mid-Cap Fund. "It will be interesting to see when they go home this weekend, do they maybe pull the trigger and sell some things. We may need another big down day. (People) want some kind of mental bottom." And even if there is another big selloff, it won't be the end of the world. Wise investors remember that after the October 1987 crash, the market rallied and the bull market was born soon after. Oh, and if you want to look at historical trends, this one may cheer you up. The Dow closed Oct. 19, 1987 at 1738. This Friday it closed at 8019. thestreet.com

To: Bill Harmond who wrote (12870)	7/20/2002 12:09:51 AM
From: techanalyst1	Read Replies (2) \| Respond to of 57684

Yes but there is a disconnect. Is Ebay really worth half as much as Disney and is Yahoo worth a quarter what Disney is worth? I don't expect that to stay that way. Either some of these old econ stocks rise, or there are still some naz stocks that are going to fall. I'll bet if I bought Disney and shorted Yahoo I'd end up being ahead in a few years.... not that Yahoo isn't a fine company, but there is a valuation disconnect. TA