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

To: Cynic 2005 who wrote (15379)	12/9/1997 8:09:00 PM
From: Tom Trader	Read Replies (1) \| Respond to of 50167

Hi Mohan re >>But, your last name is trader so you have a different objective Not quite my last name but I get your drift:) Basically, I am an investor and a trader and I keep both objectives separate. Like I once posted I have been short a stock in my trading account even as I have been long the same stock in my investment account -- not the optimal use of funds but it helps keep my goals defined. But as you know, from a trading point of view I switch positions at the drop of a hat and am not wedded to any point of view on the market. >>All I am saying is this is not a good time to "invest." I agree with you whole-heartedly -- the only stock that I have "invested" in this year is CSCO which I bought at 57 and like all investments--will hold until the story changes. I am now looking to buy several stocks in the very near future given the devastation that has occurred. >>I have had the unfortunate opportunity of reading a lot about how the earlier financial euphorias ended. Also, recently I have witnessed one each in Japan, India, and in the SE Asian countries, and S. Korea and Hong Kong. My knowedge of these events and the past events tells me one thing about all markets-- People are the market. People behave predictably as a group - whether they are White, Black, or Brown in colour; or whether they are American or Asean or whatever. My be it is my misjudgment, but in today's US markets I see signs of 1989 Japan, 1990/1995 India, 1929 USA, and 1997 Thailand/Malaysia/S. Korea!<< I agree with every word that you say. Mohan, I have been a close witness to several major bubbles--stocks, real-estate, gold, art and even commodities--and in more than one country. There are three universal truths to bubbles -- first they may last a lot longer than anyone can reasonably expect and how long they last has nothing to do with rationality; second, the tail-end of the bubble is when things get quite frantic with everyone buying like there is no tomorrow--it occurred in all of the Asian countries that you cited but IMO has not occurred here as yet and third, when it bursts it takes a lot of casualties and turns people off the investment for a long time and that is when bottoms are established. IMO, in the US we are in a correction within an on-going bull-market though some sectors are in bear markets--I think that the US economy is too well-positioned to suffer a major down-turn absent a global depression -- and that fact combined with the flow of funds are the reason why I would expect this bull market to resume. The reverse is true when the bottom is reached--hardly anyone feels that an end to the decline is in sight. So keep that in mind as you look at potential opportunities in some of these devastated markets. I am looking to go very long in some of these Asian markets using contacts that I have in these countries to help me assess the situation there. The risk IMO in these markets is less in the price levels of the markets and more the lack of currency stability. Remember the total despondency that existed in 1990 regarding the money-center banks -- Citicorp in the low teens and no one wanted it. In July 1982, there was almost a universal belief that the stock market was the wrong place to be and that the country was headed into a depression -- and then an optimistic statement by Henry Kaufmann that interest rates were going to come down was the spark that started the bull-market in the US. So to paraphrase a well-known phrase it behoves us to remember --- that in the midst of darkness, light persists. Take care