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To: Little Joe who wrote (3483)	2/27/2003 5:40:11 PM
From: Jim Willie CB	Read Replies (2) \| Respond to of 5423

ordinarily I would agree except that several factors fly in the face: - mass delusion has set up absurd expectations (crude oil going back to $20, quick war, establishing democracy in the Arab world, owning the Iraqi oilfields for repatriation costs, no terrorist retaliations, etc) - mass deception on earnings still, with proforma bullshit still widespread, and constant talk about "beating expected EPS projection", instead of focusing on slowing sales and cratering earnings - overlooking the constant distortions inherent to USGovt statistics (e.g. removing "extraordinary" blips to CPI) (e.g. phantom "quality adjustments" to productivity) (e.g. ignoring jobless who ran out of insurance) (e.g. steady favorable assumptions in early estimates) check the S&P downtrend note that Dow Utilities are nowhere near confirming recovery recall the Standard & Poor agency remarks on GAAP rules cutting S&P earnings by 30-35%, raising their PEratio to over 50 in 2002 I think instead we are setting up for a reality check if you apply the same thinking to August 1987, do you also get a bull signal, pushing aside rising rates and falling dollar? no way, Joe the market is now ignoring rising production costs across the board in their illiteracy, they cannot distinguish "good inflation" from "bad inflation" WE HAVE RISING COSTS FOR LABOR, HEALTH, MATERIALS, ENERGY, SHIPPING but the market is pleased that "inflation is returning" it is, but it is all BAD since NO PRICING POWER, which is ensured by China's continued presence when Q1 earnings come out, they will reflect rising production costs and shrinking profit margins the market will figure this out very soon, imho / jim