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Pastimes : Ask Mohan about the Market -- Ignore unavailable to you. Want to Upgrade?

To: Tommaso who wrote (11980)	12/20/1997 5:01:00 PM
From: Joseph G.	Read Replies (1) \| Respond to of 18056

T, <<still wondering about is how two services can come up with such radically different figures.>> As I responded to people previously, there is no weekly reporting by stock funds, only MM funds (which are required by the Fed). Trim labs and the other one are just guesstimating the numbers, as you or I can. (like: market went up, expect above-average inflows, etc.) Their numbers don't add up to the real monthly numbers. In other words, total garbage. Joe

To: Tommaso who wrote (11980)	12/20/1997 6:54:00 PM
From: Snowshoe	Read Replies (2) \| Respond to of 18056

Last week Barron's had an article on "Liquidity Trim Tabs": "Banking on Santa: Tracking the Float of Shares and the Money to Buy Them" by Kathryn M. Welling, Dec. 15, 1997 interactive.wsj.com It's an interview with Charles Biderman, who publishes "Liquidity Trim Tabs". He attempts to track both the available supply of stock and the money available to buy it. He can only track a portion of the float and money flow, but is attempting to gradually improve it. He tracks the available float by looking at IPOs, secondary offerings, takeovers, convertible bonds, insider selling, etc. His primary source of money flow is mutual fund data. Among his conclusions: 1) From fall '94 to summer '97 the float of shares was shrinking, while fund flow was increasing. 2) Since August the float increased, mainly due to a heavy IPO schedule and at a global level, government privatizations. This explains the market's weakness since August. 3) New share offerings virtually come to a halt every year for about a month starting at Christmas and ending around the third or fourth week of January. This is the real cause of the January effect which causes stock prices to rise in January. 4) He predicts that if the market makes it thru to Christams without being derailed by Asia, liquidity should support a strong market and possible blowoff in January '98 until the new round of IPOs hits the street in late January. 5) He thinks this potential Christmas rally could be the "last hurrah". Record levels of new offerings, record insider selling, and slowing cash takeovers are running up against flattening fund flows.