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Politics : Idea Of The Day -- Ignore unavailable to you. Want to Upgrade?

To: IQBAL LATIF who wrote (15365)	12/9/1997 7:48:00 AM
From: current trend	Read Replies (2) \| Respond to of 50167

By Joe Battipaglia, Chairman of Investment Policy 12/1/97 There are several reasons why we are in the midst of an explosive rally. First, we dismissed last week the notion that recession on a global basis is looming and felt that was a sturdy basis upon which to rally. The Japanese market is responding nicely to government efforts to allow free markets to take control and work through financial problems that the banks have labored with for the last decade. Between Friday and today, the Japanese market is up approximately 5%. Also, South Korea is close to a deal with the International Monetary Fund for a bailout package worth between $55-$60 billion. As for the U.S. economy, evidence continues to mount that companies are doing well and consumers are spending what they earn which is a sign of confidence. This suggests that outlook for profits in the U.S. are strong. With continued strength in the U.S., Europe in recovery mode, and China continuing to grow at 8% per annum, the rest of Southeast Asia should follow suit. The financial blow-off of the last two months has actually done wonders to changing sentiment on a number of key fronts. First of all, the fear of inflation has all but disappeared and the wage pressure issue is no longer a major concern. The main concerns now are whether the dollar will be too strong, the fact that far eastern currencies need additional help, and if anything the expectation for inflation is lower not higher. On the rate front, the Fed has gone from being on the verge of raising rates to being in the position to sit tight at 5 1/2% on the discount rate with the long bond at 6%. The next move for the Fed in 1998 will be a cut in interest rates on the short end. It appears that they have now mastered the inflationary bugaboo. They have concerns about global stability of currencies. The dollar is ascending not descending and U.S. deficits have disappeared. The next issue to address is expectations on profits. In October, some analysts basically cut their growth expectations for 1998 to zero and lowered their profit estimates by 50% in some cases. Now those analysts will be dealing with the fact that perhaps they were a bit too aggressive in cutting their expectations. When this kind of change in sentiment exists, it usually leads to stronger stock prices. Whether we get to new highs by year-end or some time in the first half of 1998 remains to be determined. I think it will be a broad-based rally fairly quickly. The generals will lead the rally and it will work its way into the small cap arena, similar to the manner in which 1997 has played out. Strength lies across the board in technologies, financial services companies, pharmaceuticals, health care devices and also information technologies. Media stocks look extremely cheap at current levels after under-performing for quite some time. Also, REIT's for total return are appealing and closed-end funds would be an excellent place to play some of the emerging markets, which have been down significantly of late. In particular, the transports are very attractive. They should have a strong '98 with energy costs decreasing. Two of my top choices in the sector include Union Pacific (UNP-Strong Buy-$59 7/8) and Boeing (BA-Buy-$54). UNP has had troubles in the system and BA has had the pleasant problem of having to produce too many goods with limited capacity. These two stocks present a very good value in today's market. They are big cap names and have lagged the market of late. I'd be aggressive and fully invested over the next 12 months. Look for interest rates to crack 6% on the long-end and for the Fed to cut rates in 1998. Our target for the Dow is 9000. ----------------------------------------------------------------------------------------------------- Comments?--- CT

To: IQBAL LATIF who wrote (15365)	12/9/1997 7:56:00 AM
From: Nemer	Read Replies (1) \| Respond to of 50167

Greetings Cousin Ike: Bottom line is indeed the core. Well said. OEX ...466...470...471... // > (472.49) < // ...474...477...478 Regards---Nemer

To: IQBAL LATIF who wrote (15365)	12/9/1997 11:47:00 AM
From: Cynic 2005	Read Replies (3) \| Respond to of 50167

Ike Ike Ike, you are making this a battle of shorts and longs. It is not. Nor is it the battle of good and evil. Even if it were, on any given markets, shorts don't have a prayer. At least on the NYSE, shorts are outnumbered by longs 2 to 98 roughly, based on the short-interest. bet with convincing authority on the long side of the market- the shorts have a fundamental problem with the world wrong they have been on ASEA wrong they will be on DOW. I have no words to spare. Shorts have a fundamental problem and they bet wrong on the ASEA? You can't be serious, are you? Tell that to who shorted Malaysia, Thailand, Korea, Hong Kong, Japan, even at 20% below their respective peaks. You are talking just like Mahthir (sp) who blamed all the structural probmlems of Malaysian economy on speculators. In one word, it is called lack of accountability. It is good to ask "what is happening to us" rather than asking "who is doing it us" and make a scape goat out of some short-seller who was wise enough to see things ahead. BTW, I am glad you like WDC at 19. After all, you loved it in high 40's you should love it even more now. -vbg- -Mohan

To: IQBAL LATIF who wrote (15365)	12/9/1997 3:45:00 PM
From: steve susko	Read Replies (2) \| Respond to of 50167

SOX is in danger of breaking your key support level of 280. It's down to 284 now. Time to proceed with extreme caution. Do you think the Asian markets are due for a rebound soon? Some of these markets are down 1/3 to 50%!

To: IQBAL LATIF who wrote (15365)	12/9/1997 6:19:00 PM
From: Judy	Read Replies (4) \| Respond to of 50167

Ike, my dear, this is a time to proceed with caution within the longer-term bull market. This Asian flu cannot be cured quickly and may need a good dose of antiboitics to expel it. Today the ORCL debacle demonstrates what can happen. Stock has been hovering at/below its 200-day ema waiting ... and it got a 30 percent haircut in share price although Asia contributes only 15 percent of its reveneues. Numerous tech stocks are hovering about key supports waiting for fundamental news to clarify the direction. Note that dd's and semi-equip makers have been devastated due to the unpredictability of the Asian currency situation on future revenues, BUT the semi-equip makers can still get a similar haircut as ORCL; semis such as LSI and ALTR and TXN knocked for a loop; NN, ASND helped by Mory's lies, CS and COMS all prewarn and subsequently tank ... imagine if CSCO pre-warns too for generals are the last to fall. January will be an interesting month. Wow, if a telecom like LU or TLAB prewarns ... or if a boxmaker like IBM or CPQ prewarns ... and you get my drift.

To: IQBAL LATIF who wrote (15365)	12/9/1997 7:13:00 PM
From: Nancy	Read Replies (1) \| Respond to of 50167

Ike, <<WDC at 19 and RDRT at 19 QNTM at 27 and COMs at 37- soon these stocks will fly>> Just based on what these will soon fly ? wishful thinking ? << someone somewhere will realise the potential of INTC TXN and in comes the 'bhumbo'- if it dosen't come I will make sure that on break of 280 on SOX I go short the market.>> If you are so convinced that these stocks are soon will fly, why you would even have the idea that SOX would break 280 ? You may get that chance very soon - all we need is another prewarn or earning miss - PLAB will announce soon - we shall see.