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To: donald sew who wrote (39004)	4/10/1998 1:29:00 PM
From: Gersh Avery	Read Replies (1) \| Respond to of 58727

Thanks Don .. Yes I agree that the money will be looking for safety ie: US bonds. Currently US bonds have some speculative money in them. When bonds jump up, the speculative money will "profit take" and go into stocks. That makes the entire market go up. When bonds go down hard, speculative money leaves stocks to go back to bonds. I look at it as if it were water flowing. It flows off the high point to the lowest. Lisa re inflation: The Fed has been pumping out dollars at the rate of ~10% per year lately. Yet our inflation is currently only ~1.5% (? not sure the exact numbers) The remainder of the dollars have been absorbed by the rest of the world as "safe haven holdings". At this time every government on the planet is dumping dollars to support the yen. The day may come when our markets may look to us as if they are going through the roof. However our import costs will suddenly go up fast. It may take a month or two before we get the news that hyperinflation has come home. Remember .. the Feds main worry still continues to be inflation .. AG has now gotten to the point, I believe, that he thinks there may be nothing he can do to stop the events we are about to see. Gersh

To: donald sew who wrote (39004)	4/10/1998 8:30:00 PM
From: ViperChick Secret Agent 006.9	Read Replies (3) \| Respond to of 58727

more on the Japan saga to confuse you Message 4029052

To: donald sew who wrote (39004)	4/10/1998 9:49:00 PM
From: ViperChick Secret Agent 006.9	Read Replies (1) \| Respond to of 58727

Don here is my easter present to you decisionpoint.com notice the last link Cute as a bunny Lisa ps..here is more to add to the Japan confusion: economist.com

To: donald sew who wrote (39004)	4/11/1998 12:18:00 AM
From: Patrick Slevin	Read Replies (1) \| Respond to of 58727

I did not scan lisa's links yet. The risk in Japan is the repatriation of capital from Tokyo Banks selling Treasuries to prop up capital at home. A break in the Nikkei would send monies here short term, but would be offset by a wave of Bond selling by Japanese Banks. Have a pleasant day.

To: donald sew who wrote (39004)	4/12/1998 4:58:00 AM
From: Robert Graham	Read Replies (1) \| Respond to of 58727

I do appreciate your posts on the technicals of the market. I do have something to contribute to this discussion about foreign money and its impact on our market. Foreign money has been going into our bond market for sometime now, actually since the beginning of this bull rally. IMO this is why when the fund money moved back into the stock market from the bonds and money markets, the long bond took an initial dip which resulted in a bit over 6% return, then it pulled back due to a continued infusion of foreign funds. There has also been much foreign money entering our stock market for a safe haven ever since the Asian crisis. They go for the "blue chip"' stocks, particularly the ones they recognize like GE and others that have well-known names throughout the world. Just take a look at the GE chart to see what I mean. I suggest to not underestimate the liquidity of this market and its ability to continue floating many boats. Also the funds have already been selling off due to sector rotation. Look at a sector leader in the market like retail to see evidence of this before this market correction, which I am sure has helped lead to the correction. At this point, I suspect the funds will resume their strategy that is a necissary part of managing billions and billions of dollars: buy on the dips where there is a supply of shares for sale. Just look at the pullbacks for this bull market run for evidence of this. Every pull back except for recent market selling has been very moderate, even defying technicals like the OB/OS type of indicator. This is how the market can remain overextended for a long period of time before the OS state of affairs catches up with the market. As long as there is substantial liquidity, further helped by sector rotation, I do not believe you will be seeing this market going much of anywhere except perhaps through a period of consolidation. When liquidity dries up, even during interim periods of time where fund purchasing abates, volitility will be present in the market. That is what we have been seeing. I suggest to look carefully at how this bull run has been progressing and the "trading" behavior of the indices and market at large. This is what happens when there is allot of money being moved into the market by the institutions from where they kept their cash in bonds and money markets during the last market correction. I have seen this before. It is unmistakable when you have been through this at least once. However, it did take me a period of time to catch on to this and remember what it was like in the past. I think the important questions now are: where are the funds at with their cash position? When will they move back into the market? What sectors and industries are next in line for their investment dollar? This will determine the near term future of the market more than most anything else. Look for evidence of large accumulation during this consolidation. I am sure you know that this will help you identify the sectors and industries, and individual stocks next to fly. Bob Graham