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To: Gersh Avery who wrote (2628)	4/24/1998 1:09:00 PM
From: MonsieurGonzo	Read Replies (2) \| Respond to of 11051

Gersh; RE:" Old News & tidBITS " *J.P. Morgan recommends cutting stock allocation* NEW YORK, April 24 (Reuters) - J.P. Morgan & Co Inc. (JPM - news) is recommending cutting back on stocks held in its model portfolio to 50 percent from its previous recommendation of 60 percent. Douglas Cliggott, the firm's U.S. equity strategist, raised bonds by 5 percent and cash by 5 percent. The model portfolio is now 50 percent cash, 35 percent bonds, and 15 percent cash. He said the stock market may have run up too fast, making the near-term risk/return profile ''not very attractive,'' in a research note. Cliggott said stocks are 11 percent overvalued compared with bonds, the biggest mismatch in valuations since early 1993. The Standard & Poor's 500 Index has sprinted up 15.37 percent for the year so far against the not-so-favorable backdrop of rising interest rates. The yield on the 30-year U.S. Treasury bond is back near 6.0 percent. He said the massive inflow of money is driving the market now -- ''liquidity is in the driver's seat'' -- compared with the beginning of the year, when value drove stock buying. The money driving stocks higher is mainly from U.S. households, he said. Cliggott said buying in domestic equity mutual funds rose 27 percent in the first quarter, compared with the same quarter last year, and did not slow even in April, when the country settles up its tax bills. Meanwhile, cash holdings are at a 10-year low. Foreign inflows, another main leg of liquidity, still look very strong. In 1997, non-U.S. investors bought a record $65 billion of U.S. equities, sharply above the $12 billion in 1996 and $17 billion in 1995. Although first-quarter data will not be available until June, Cliggott said the dollar's strength, the widening U.S. trade deficit, and the divergent performance between the U.S., European and Asian equity markets point to continuing strong capital inflows. Share-buyback and merger activity also have been driving liquidity, he said. The inflows could be sustained for a long time, he said, and ''the risk of a major correction...is probably not very high. ''But we do think value matters, a lot,'' he continued. ''And so we would be surprised if 30-year Treasury bonds didn't give the S&P 500 a run for its money in coming months.'' >Steve .. interesting tidbit; Rumor has it that Viagra works just as well, if not better, for females <GGGG> Wait 'till that news hits .. PFE PFE PFE!!!!!!!!!!!! Yow! *Spanish Fly ?* (^_^) -Steve