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To: Robert Graham who wrote (42593)	5/7/1998 5:56:00 PM
From: Gersh Avery	Respond to of 58727

Robert The Fed will continue to pull liquidity out of the market for the next several days. biz.yahoo.com Gersh

To: Robert Graham who wrote (42593)	5/7/1998 6:08:00 PM
From: Tom Trader	Read Replies (1) \| Respond to of 58727

Re the market I basically agree with your analysis--the quality of the next market rally from whatever lows we make during this current pull-back should be quite revealing of the health of this market. If I had to hazard a guess as to the next move, I suspect that we will probably see a strong rally in some of the averages to new highs because the bonds will likely support the rally. Like I said the last go around, there is too much caution and pessimism for the market to fold at this point and sentiment indicators do not support a major decline. Not sure what the trigger will be for a more prolonged decline -- but I know that some have suggested that the end May/June time frame for a cycle top and may be this together with technical weakness and perhaps Asia's problems combined with a damaging report from Starr, that is expected in that time frame, may be the catalysts. But ultimately, all of this is mere conjecture.

To: Robert Graham who wrote (42593)	5/7/1998 7:13:00 PM
From: Patrick Slevin	Read Replies (1) \| Respond to of 58727

Gee, your posts always require so much work. I thought I was going to able to get on, get off, and watch the B-Ball games. This is harder than trading. All kidding aside. The potential I think is there for not a panic selloff. Instead a stairstep decline, as the smarter players sell strength and daytrade weakness. There is no real reason to hold this market up. Much money appears to be in a flight to safety, a flight to bonds....which in fact is hardly safety. In a break, the long bond shall be the first to crack along with the Greenback. It's absolutely foolhardy to move cash from stock into bonds. A rise in interest rates by the fed or a break in Japan will drag down the bond. A derivatives crisis will drag down the bond. The exposure in derivatives in the US is at all time highs. Who knows what a cyclical mass unwinding in derivatives could do to the market? Not I, not anyone....because the exposure is so great. One thing I do notice, something I mentioned to Tom earlier. Rallies are being sold. No question. A soft number tomorrow may bring us up to new highs but at the risk of a weak economic growth number. How long can we explain that away? A strong number should certainly drop the market in the face of the more immediate threat....Fed intervention by raising rates, something I think Greenspan alluded to, however vaguely. Anyway, following your train of thought with respect to watching the market indices ith respect to the SPX and so forth....I don't think a crash is imminent. There are too many people accustomed to buying dips. So we drop 200, rally 100, drop 200 and so forth until.... "Gol-lee. Surprize, surprize, Gomer....." My point is not to make light of your points or anyone else's for that matter. I think of the market from the standpoint of a worried bull. I honestly think by the end of the year the market will be incredible. However. All this absurd behaviour that I see on television, this blind buy the dips crap that even respected fund managers espouse on financial television, this attitude that the rules have changed is for children who have no idea that the fundamentals of this market are not in line with reality. A reasonable case can not be presented that Asia can collapse and that is short-term bullish for the US. A reasonable case can not be presented that bonds can break and the stock market will chug along. These are important issues, Bob, and the (wo)man on the street does not realize it. These people shall realize it, when the money they have been pumping in does not give them the return they expect. There shall be the bottom. I know, I'm ranting again. Most people know not to get me into this kind of conversation. Anyway, now that I have wasted your time reading this, my impression is that the financials of the market will not support the bond and in turn the market shall slowly spiral down, regardless of tomorrow's numbers. I guess I could have saved time just saying that in the first place, sorry.