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Technology Stocks : DELL Bear Thread -- Ignore unavailable to you. Want to Upgrade?

To: China Trader who wrote (260)	3/22/1998 11:29:00 PM
From: Ally	Read Replies (1) \| Respond to of 2578

>>Denise, I was disappointed on Friday that the Fed news on Beige book reference to tight labor market and that Fed would not hesitate to preempt interest rate hike was not noted in the market<<. Hui, the market has such strong upside momentum, and with the first quarter coming to a close, money managers don't want to look foolish not being fully invested. The strong economy and tight labour market and low interest rates are all old news as far as the market is concerned and the market figures rates will continue to stay low. As long as Bond rates stay low, the stock market is going to continue to stay in this euphoria mood. It is very unlikely that Bond rates will rise, unless there are consistent signs of inflation up ahead. The only forseeable factor now that can stump this almost unstoppable market is earnings. Even then, it may only slow it down a bit but not stop the rise altogether. The market is now rotating into sectors for over-valuation. For example, oils, chips, pcs are all down; insurance, banks, drugs are up and going even higher. Like I mentioned in a previous post, it may take two quarters of generally poor earnings across the board before logic and rationality step in and correct the market's exuberance. >>feel that Wall Street is too blind to bad news and only care about too much money chasing after too few stocks, so stock prices will go up, and the sky is the limit<< Yes, the same stocks that are already high, are going even higher. However, I think it will continue to go higher. >>This kind of euphoria is just the preamble for a big crash. Hope it won't happen so drastically to cause a worldwide recession<< If there is a crash, I doubt it'll be so drastic that it would cause a world wide recession. The fundamentals on the Western economy are very sound. Corporations are lean and mean and technology has brought on productivity as never encountered before by the industrial world. As long as interest rates stay down, there is no other game in town except the stock market. And rates are staying down because inflation is under control. The only thing I see ahead is a correction (say 10% to 20%) due to over-valuation of stock prices when compared to earnings reported. After a short correction, my guess is that the stock market will continue going up. People have talked before about the "new economy" and the "paradigm shift". This is already here, and I would not be surprised if there are many more years of controlled inflation, and absence of "boom and bust" of the business cycle as we traditionally known them. IMO, the way to deal with these times is to go with the trend and buy stocks. Buy stocks that have fundamentally sound businesses at reasonable prices (better still when they are out of favour) with the view that stocks give the best returns than other instruments. BTW, how do you see Asian stocks? I am eyeing the HKTel stock trading in NYSE. d.