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Strategies & Market Trends : Technical analysis for shorts & longs -- Ignore unavailable to you. Want to Upgrade?

To: j g cordes who wrote (14915)	12/5/1997 3:22:00 AM
From: Snowshoe	Read Replies (1) \| Respond to of 69913

Jim, in his essay Henderson gives a good explanation of why mutual fund money flows should be taken with a grain of salt. There are many types of players in the stock market, and the mix changes over time. But there are always buyers and sellers. As for the mutual fund cash level chart, perhaps if it went further back in time and the index funds were stripped out it would be a fairly impartial measure of fund manager sentiment (which might be a good contrarian indicator). Henderson also comments on saving by the baby-boomers and mentions the disparity between stock and bond prices, saying: "The boom in stock prices must be due mainly to an increase in the expected stream of future income from stocks." I think the key word here is "expected". Could it be that because boomers are at an age where maximum earning power is combined with maximum risk tolerance, they are more prone to over-expectations? As they age further, will they cast a more jaundiced eye on corporate earnings forecasts and demand tangible dividends as returns on their investments, thus bringing stock and bond prices back into closer balance? BTW, Compaq boss Eckhard Pfeiffer mentioned a couple weeks ago that Compaq is going to start paying a dividend...