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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: William H Huebl who wrote (14023)	2/10/1998 8:44:00 PM
From: Tommaso	Read Replies (3) \| Respond to of 94695

I hope it is not too impolite to point out that you were calling for a 5% drop last week, and that GZ was terribly excited about three weeks ago about a supposed "outside reversal." I think that a week or so ago when I made a little joke about making a funeral pyre of tomes of financial analysis, you mentioned the superiority of TA (technical analysis) over "FA." Did you mean Financial Analysis or Fundamental Analysis? I remain steadily bearish in the face of all these new highs, because very seldom have United States Stock prices been this high in every measureable aspect: P/Es. relation to book value, relation to gross national product, and--perhaps most significantly--dividend yield. As at moments in the past of vast overvaluation of common stocks, the concept of the incorporated company as a source of dividend income to its shareholders has been largely forgotten. As we know from the history of financial bubbles over the last four centuries, there is no telling how high valuations may go when greedy hope clouds judgment about fundamental values. Many speculators may be ruined either by fighting the rising trend or, worse, by finally joining into it in the belief that they are wise enough to know when to get out. If one must speculate, the best place to be is the Asian markets where not only the stock prices but the currencies are already marked down. The great majority of savers would be best advised to get money into insured bank accounts. Precious metals are about at their lows, too, --as everyone knows now, silver has been blessed by Warren Buffet. By the time Templeton is seen to be into gold it will be too late for that. Which is to say that I doubt that it will ever happen, though after the run-up in the 1970s he did say "we may have missed something" and like Buffet may be taking a long-delayed second look. My own favorite is oil. It is worth so much more than it costs, when you consider what it will do for you. Natural gas, too.