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To: Lucretius who wrote (21199)	5/3/1998 1:29:00 PM
From: William E Hodal	Read Replies (3) \| Respond to of 95453

Your posts indicate a lot of detailed work. You owe it to yourself to read Louise Yamada's book: "Market Magic: Riding the Greatest Bull Market of the Century." John Wiley & Sons, 1998 ______________________________________________________________________ Salomon Smith Barney technical analyst Louise Yamada has written a monumental book, one that all serious and professional investors should read. The scope, breadth and depth of Yamada's inquiries are unmatched by any investment book I've come across in years. What you encounter here is a mind at work, carefully evaluating stock market history and trends, and trying to draw reasonable conclusions about the probable course of our equity markets; not to mention reflections on the future of inflation, demographic trends, commodity prices and the new shape of our economy. Yamada's great strength is mining stock market history to find conditions analogous to our current market, and then making reasonable conclusions based upon that history. Armed with those lessons, she makes a compelling case that our current bull market may very well continue: "Our review of relevant market history has established the historical precedent for further extension of the 1982-present bull market. Technical corroboration is furnished by the similarities between today's bull market and its predecessor in 1942-1966, including: a shared background of low interest rates and low/stable inflation; an analogous Advance-Decline line trend pattern; the experience of numerous record market advances without any 10 percent reversals. . . In addition, these two bull markets have shown comparable strength in weathering discount rate raises. The technical evidence suggests this bull market is poised to continue." Yamada believes that much of the credit for the bull's longevity can be found in what she calls the "Two-Tier" equity market, wherein those companies that have exposure to the global marketplace (usually the larger-cap stocks) will flourish. Companies that draw most of their revenues from within our borders are more likely to be hurt by interest-rate increases and domestic recessions. Yamada explains that this may help us understand why 1994 was such a cruel year for small stocks, while the Dow managed to perform okay despite steep rate hikes by the Fed. These factors, combined with some technical analysis of relative strength trends of the larger, internationally exposed companies, lead Yamada to conclude: "The newly established outperformance trend of the DJIA is still young in its progression, and should continue for some time to come." Yamada builds her bullish case by examining many parallels between today's market and 1946-1956, showing similarities between the advance-decline lines, the shifts in market leadership and "record advances without as much as 5 percent or 10 percent reversals" from both periods. Based upon these and many other reconfirming parallels, Yamada suggests that if the Dow were to continue to mirror the 1946-1956 period, it could be on its way to between 10,921 and 13,343. Yamada also finds strikingly bullish parallels between the 1982 to 1987 U.S. stock market and the "initial up-leg in the Japanese Nikkei from 1968 to 1973." Using these similarities, Yamada suggests we could see the Dow reach 10,000 by 2000 and then nearly 20,000 by 2002. While that may sound farfetched, Yamada finds a sound historical basis for these levels. Juicy market projections like these are really only a small piece of the treasures that await the patient reader of this book. Yamada masterfully discusses demographic trends and their relationship to the future health of the bull, and in a fantastic chapter on inflation argues convincingly that we must re-evaluate "our traditional means of measuring inflation." Her view: "It is very difficult to make a case for the return of inflation any time soon." Furthermore, the CRB index, which is supposed to find the early signs of inflation by measuring demand for industrial commodities, is pretty worthless as a measurement in today's economy, she says. ______________________________________________________________________ Roger Segal, the main keeper of the Investors' Bookshelf, writes his reviews from Manhattan's Upper West Side. He welcomes your feedback at Gersonides@aol.com. c 1997 TheStreet.com, All Rights Reserved. ______________________________________________________________________ Bill

To: Lucretius who wrote (21199)	5/3/1998 1:45:00 PM
From: Gator II	Respond to of 95453

LT wrote (in part): >>...as for mutual fund mgrs expecting a correction. yes, many are. yet, they are FULLY invested. NOBODY is worried about an end, just a correction. W/ fund levels as low as they are, it may not be enough to convince the mkt that the bull is alive and well.<< This statement, alone, is undeniable. It should make anyone who is cautious (contrarian??) to re-exam both their portfolio and their near term objectives. As previously stated, I think you are premature LT, but I would be the first to concede that you MAY be right on target. As it is often said, "no one rings a bell when the market turns." Thanks for stimulating this discussion. GATOR II