Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: RetiredNow who wrote (61454)	9/27/2002 2:48:54 PM
From: larry	Read Replies (2) \| Respond to of 77400

Hi mind, Do you REALLY believe that this is a surprise? All I have heard from different big companies is that it's going to get much worse before the turnaround. And don't count on an IT budget increase for 03. Actually I will be surprised if the number does not shrink 10% and we don't top 7.5% unemployment rate next year. The aging DOW should make an imminent push for 7000-7100 after breaking the neckline of the mini H&S formed in the last 3 months. A tradable rally might push us back toward 8000, and then we resume the march toward 5800. larry

To: RetiredNow who wrote (61454)	9/28/2002 4:33:50 PM
From: Tom D	Read Replies (1) \| Respond to of 77400

MM, please take a look at this chart: stockcharts.com If you grab the left margin of the horizontal scroll bar (theone that says 200 days in its middle) you can drag it to the left and expand the chart to 460 days. You can also drag the left and right ends of that scroll bar to zero in on a period of a few weeks that is of interest. And then, as time and interest allow, read a few back issues of Investment Research and Insight, and read some of the weekly recent market comments from John Hussman. hussman.net The weekly market comments do a lot of teaching and analysis of issues like the problems with the fed model and the dividend models for market valuations, as well as sprinkling in references to Mark Hulbert, Ned Davis, Norman Fosbeck etc. Hussman carefully explains whe he thinks the markets are overvalued, and the huge negative impact that upcoming crises in pension fund losses and our current account deficits will have in future years. He also discusses how little it will take to bring Fannie Mae into bankruptcy due to its 40x leveraging. He also explains his investment methodology: buying a diversified group of stocks that he expects to outperform their benchmarks, and then hedging the benchmarks either partially or completely. He never goes net short on the market. He follows an investment discipline based on his indicators. He wrote in August that in his personal opinion he expected a bear market rally of 20%. His investment discipline called for him to unhedge 40% of his index shorts during part of that period and he did so. (from 7.23 to 8.20 2002 during our bear market rally, HSGFX was up 2.5%) In this context, being plus 45% in the last 24 months is amazing. All in all, it is a thoughtful, methodical, careful analysis of the high-risk overvalued state of the U.S. markets. After I read the 36 pages of recent market comments, my major conclusions are: 1) I cannot rely on my Salomon Smith Barney financial planner to call major market trends. In January 2002, SSB forecast a 15% rise in the major market indices for this year. In December 2001, John Hussman's methodology indicated that the investment climate merited a warning status, and he has been there ever since. 2) Hussman's track record is short but fabulous. He went from neutral in August 2000 to very negative in October 2000. 3) Hussman catches some of the upswings some times. And HSGFX is up 15% YTD, versus down 25% for the S&P. The HSGFX prospectus says he can leverage to go 150% long in very bullish times. So I am actively looking for other market timers who have attractive records and credible methodology that will be successful in both bearish and bullish periods. So far, HSGFX is the best I can do. I talked with the wife & we are tenetively planning to shuffle our bonds so that they are all about 3 year tax free. We will hold these to maturity. We will liquidate the longer duration bonds. We may end up 60% bonds, 24% HSGFX, and 16% HSTRX. I think there is actually an institutional version of HSGFX, so I've got my financial planner studying it for me. I'll let you know what he concludes. Best regards, Tom