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Strategies & Market Trends : Roger's 1998 Short Picks -- Ignore unavailable to you. Want to Upgrade?

To: kimberley who wrote (6728)	4/11/1998 3:05:00 AM
From: Dale Baker	Respond to of 18691

I don't follow the macro statistics for the market because I'm not playing the "hot" stocks which funds buy and sell. My current collection of longs could be described as "eclectic" - or just wacky considering they don't mirror the big momentum high fliers. Just my opinion - there is a big lag time between the markets pulling back and cash inflows being reduced. If there is a 1 - 2 month drop, I'd guess that the amount of "elective" new money would be the first to go. Drop 15 - 20% and some would start to cut back on the "automatic" contributions. But the idea that the market will always bounce back is strong. My concern is that a lot of folks who have made 100% in the last three years will see 50% or more of that profit vanish in a very steep drop - so steep that they won't react fast enough to protect their capital. When was the last time you heard anyone mention capital preservation? By the time they do, it will be too late (just like it's too late to make much on Internet long positions). Wow, I'm really rambling here. In short, I think the markets may keep going up as long as new money flows in. Eventually the dream will die, lots of folks will get screwed and money managers will decide to lock in profits before another good year gets wrecked. All of the above is worth exactly what you paid for it. ;<)