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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: William H Huebl who wrote (7420)	10/25/1997 9:44:00 PM
From: Defrocked	Read Replies (2) \| Respond to of 94695

Bill, two anecdotes and some Monday indicators( and I agree that 10% down from here would not be a crash.) Anecdote One: The CBOT paid $50 mm for the rights to list DJIA futures and options on futures. Last spring the cheapest seat to trade these contracts, an IDEM, went from under $10,000 to around $100K. This last Friday four( 4 in one day is a lot mind you) , seats were sold off at lower bids in succession now down to 70K. Implication: Margin calls, Tap outs and volatility increasing Caveat: Could be a contrary indicator or that inexperienced floor traders got shook out. Anecdote Two: At least four individual investors approached me at different times Friday to inquire about the safety of their mutual fund holdings and whether they should get out of stocks, some foreign,some domestic. Implication: The public is worried and I question the staying power of those that have shifted from Bank CD's to mutual funds during the last two years. Caveat: The staying power of this market has surprised me before. An Indicator I Will Watch On Monday Grain prices at the CBOT. On Friday grain prices followed the stock market closing slightly up at their close 90 minutes before the stock close. If grains follow stocks down Monday AM then IMHO liquidity concerns are impacting the commodity markets. If grains trade lower with gold down again such action would have deflationary implications of large concern. Question Your Assumptions When Unexpected Occurs Recent stock market activity could be much more related to asset valuations rather than earnings discounting. Much liquidity growth went into financial assets during the last 3 years as evidenced by rising stocks but little inflation. The source could be attributed to changing expectations, less US crowding out due to lower deficits and greater confidence in the Fed. Remove these underpinnings and stocks fall, by how much I don't know since a bid to bonds should help equilibrate the decline. I remain cautious and nervous with a portfolio fully protected with puts. My concern has shifted to deflationary scenarios rather than EPS estimates. Heaven help us if the Fed raises interest rates Nov.12 in this environment. Would be a seismic blunder IMHO. Caveat: I almost always lose my put premium.<ggg>

To: William H Huebl who wrote (7420)	10/25/1997 10:57:00 PM
From: Bonnie Bear	Read Replies (2) \| Respond to of 94695

Bill: go ahead and laugh at me for being a bear (i'm getting used to it). Open mind? yes. open pocketbook? only when it makes sense. I sold a house the end of June and had new money to invest. There was a huge bubble in the international index. So it made for sense for me to wait until it peaked and short into it, which is exactly what I did. Now I have profited nicely by being a bear in low-risk bear investments, whereas I would have lost money, a lot more money, by investing long into the top of the global bubble. As a global investor I will go long when I see some evidence of a correction in THAT index. For new money in this market the long side is simply too high a risk at this time. For day-trading and day index puts and calls, fine. If I have any regrets as a bear it was for not being a more aggressive bear as I let many opportunities slip by listening to the bulls on the thread.

To: William H Huebl who wrote (7420)	10/26/1997 1:40:00 PM
From: Jerry Olson	Read Replies (1) \| Respond to of 94695

Hi Bill The Pocono's huh?, near my neck of the woods...Have a nice time and don't look at the markets<g> After reading Barrons, and reading a bunch of other stuff, i came to the conclusion, that the Bears are emerging faster than ever.. I am a realist of sorts<g>, and don't think for 1 moment that this market couldn't come crashing down around us... But it won't be from any Asia currency or devaluation crisis..The 1 thing that has begun to creep into all the Soothsayers minds is, Deflation!!!!??????? Huh??? yeah, well maybe, but NOW!!!??? ah, i don't think so!!!! IMO, we have just begun to come out of a horrid depression from 89 to 93-94..The REAL BULL MARKET started in 94 and is roaring along at a breckneck pace...This year we have had 2 corrections and maybe we'll have another... But a crash??? Not in this lifetime... Oh I know you too do not believe there could be a crash... I got it, ok!!! But Deflation my friend would institute rates coming down!!! Not UP!!! If AG has to cut rates, whew!!! the upside could be dramatic... Yes there will be sectors that will under perform that market senario.. But Bill there are sectors doing that NOW!!! I believe we have ignored the pride, the intellect, and the competitive nature of the Asian Co's... Lose Markets share??? I don't think so... Stop capital spending, not likely, geez and let MY competitor gain a larger share of MY market??? Not on your life!!! No Way Jose!!! Right now in the next 2-3 weeks, if we get by next weeks eco reports unscathed, AMAT & KLIC will annouce their earnings and talk about the future of the semi equipment makers in Asia and around the world... Fully 80% of ALL KLIC's business comes from Asian driven orders from the biggest and best Co's there... This alone will tell ALL of us, where and what direction these markets will go in that part of the world.. I think it very prudent to wait and watch and listen to these 2 very well positioned co's AMAT & KLIC, for their guidence on this hotly contested issue... But Bill the Semis are not the only sector to play..Drugs, Financials & my favorite OILS, should be looked at and monitored for entry into these sectors... I love the give & take of this thread, many bulls and bears here, each with compelling thoughts...All valid, buy mostly just NOISE!!! Nothing but NOISE!!! we shall see very soon whats, what with the REAL direction of the DOW...Money is still at this very moment pouring into the funds, another 4.8 billion last week... I wonder where it's going to go!!!???? I'm very bullish, but scared as always... Blindsides, out of the blues, crazy stuff can hit you at any moment from nowhere... But all in all, it's been one terrific year, yeah very very nice my friend... I don't own puts, havn't at all this year...I would look hard at AMAT leaps...Sheesh, what a co and what potential for the next few years... It's very tempting right here.. We'll see huh??? My Best to you & yours, Regards, Jerry