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To: The Ox who wrote (1404)	1/21/2013 4:34:36 PM
From: robert b furman	Respond to of 8239

around 4 and before 5. Bob

To: The Ox who wrote (1404)	1/22/2013 12:15:30 AM
From: Return to Sender	Read Replies (11) \| Respond to of 8239

Business Cycle & Stock Performance Because sector funds have a narrow focus, you should be familiar with the factors that may affect the industry in question. personal.fidelity.com Based on a comprehensive analysis of the relevant facts, you may arrive at a judgment as to what the industry's performance will be like going forward. One technique commonly used by is to monitor the business cycle for clues as to what may be happening in the market. Business Cycle Basics By examining empirical evidence, the investor can attempt to create a framework for viewing present and future events as they unfold. There are two key questions the investor may want to ask: 1. Will the historic pattern hold, or will it be altered? To answer that, you'll need to ascertain whether the factors driving today's market are fundamentally unchanged, or whether the situation has evolved incrementally or even been radically changed. 2. Has the market already taken the anticipated future events into account? If the factors driving the industry are the traditional cyclical ones, the market usually will have taken them into account, because they are expected. If the factors represent a new element in the equation, then the market may not be expecting them and may not have adjusted accordingly. Business Cycle and Relative Stock Performance The following chart shows a typical business cycle and the points at which various economic sectors tend to outperform the broader market. Click any number in the chart to learn about the cyclical characteristics of a particular industry. The chart above shows a typical business cycle and the points at which various economic sectors tend to outperform the broader market. Please note that the chart should be used for illustrative purposes only. The chart is a historical representation of stock performance movements relative to the business cycle and is not intended to convey any current or future economic outlook. Choose a Sector for a detail description of its role in the business cycle. Source: 2000, Standard and Poor's, a division of McGraw-Hill Companies, based on a study analyzing the differences in market returns of 90 Industries vs the S&P 500 during 10 complete economic cycles from December 1945 - December 1995. Consumer Non-Cyclicals Stocks in consumer non-cyclicals (food) and consumer growth industries (cosmetics, tobacco, beverages) tend to experience fairly steady demand and are less sensitive to changes in the business cycle. These stocks typically attract investors when the economic cycle or bull market has matured, or is in the early stages of contraction. I will use the BP Indices and some of the older Amex Industry Holder ETF's to show these relationships. RtS Consumer Cyclicals (durable & non-durable) Stocks in this category include durables and non-durables that are sensitive to interest rates as well as the business cycle. Investors typically seek them out when the economy is in the late stages of contraction. Healthcare In general, stocks in this sector move similarly to consumer non-cyclicals. This sector is considered defensive, meaning companies in this sector are generally unaffected by economic fluctuations. The healthcare industry consists of pharmaceutical firms, HMOs, biotechnology firms and medical equipment suppliers. Pharmaceutical companies are affected by competitive market shares, the pace of FDA approvals, patent lives, and the strength of the R&D pipelines. Many biotechnology firms are still in the development stage with their fortunes largely determined by investor perceptions of the relative merits of their R&D pipelines. With future new financing likely to be more difficult to obtain than in the past, strategic alliances between major drug companies and biotech firms are expected to increase. Financials Stocks in housing-related industries tend to respond well to falling interest rates and are often targeted by investors in the mid to late stages of an economic contraction. Non-mortgage-dependent banks are generally driven by commercial and consumer loan growth, and tend to be favored by investors during the middle of the cycle. Technology Technology stocks can be cyclical to the degree that they depend on capital spending and business or consumer demand. However, they may also have long-term growth potential as technological products find broader applications and as new technologies are developed. Technology stocks are usually popular during early to mid stages of an economic expansion. Basic Industry Profits of basic industries are driven by high utilization of capacity and strong market demand for products. Therefore, their stocks tend to be popular with investors late in an economic expansion. For basic material companies, the global economic picture and supply/demand equation also affect stock price movements. Capital Goods Capital spending tends to increase midway through the business cycle, as the economy is heating up and higher demand for products leads companies to expand their production capacity. Demand in global export markets is key for agricultural equipment, industrial machinery, and machine tools. Transportation Railroads and other surface carriers tend to react early to a pickup in the economy. Airlines are subject to cyclical fuel costs, usage versus capacity, and competitive pressures on airfares. Energy This category includes large integrated international companies, domestic exploration companies, and energy services companies. Each industry has its own dynamics, but ultimately all are driven by the supply and demand picture for energy worldwide. Political events have historically had a major impact on these industries. Stocks tend to be popular with investors late in the business cycle. Utilities Electric companies have historically been very sensitive to interest rates because of the large debt financing costs they must incur in order to build their infrastructures. These stocks tend to perform well in an environment of declining interest rates. Telephone companies may offer attractive long-term growth opportunities, as they diversify and compete in recently deregulated telecommunications markets. Precious Metals Precious metals and the stocks of companies that mine and process them can be affected by industrial and consumer demand, but the largest factor contributing to volatility in this category is generally inflationary pressure. Investors often flock to this category late in the expansion cycle.

To: The Ox who wrote (1404)	1/22/2013 11:34:52 AM
From: richardred	Respond to of 8239

I'd guess 6-7 Past mid recovery, and IMO It's a weak recovery.

To: The Ox who wrote (1404)	1/22/2013 2:52:05 PM
From: Return to Sender	2 Recommendations Read Replies (1) \| Respond to of 8239

And several hours later I think I have the thread header working again. I don't like the fact that I have to rework half of all the chart posts I have made in the past. Lets give the new management here a chance to fix whatever they are doing that makes older posts with charts no longer work. I think we are further along in our economic cycle than Bob for sure but as long as the FED continues to support the stock market with its endless supply of dollars the market could continue on higher. Right now though sentiment is getting pretty bullish with very little fear. That's going to end up with at least a pullback in the market post earnings. If we continue on higher until we get RSI 70 on monthly charts then I would be afraid that the market is in for a much bigger sell off. Also keep in mind that once the FED sees low enough unemployment then they stop filling the punchbowl. Even if we never get there at some point inflation will come back. RtS