To: Amelia Carhartt who wrote (13152 ) 6/14/1998 9:51:00 PM From: ahhaha Read Replies (2) | Respond to of 116811
Free markets are always at work even if the government outlaws them. The free market will eventually destroy any government that tries to interfere with it. The rub is that the market takes a long time to accomplish the dismemberment. The Soviet Union destroyed the lives of two generations of Russian people. It took that long to rid themselves of that absurd 19th century apotheosis to hegemony. Do you know when it went? No one does. Somewhere between 1989 and 1991. It just slinked out of town. No one was responsible. The entire nation was engaged in a giant conspiracy which no one wanted, but few would try to resist. This piece of junk testament to the glory of socialism has yet to make its apologies to the millions of murders committed under its boot. When it comes to the natural cycle of things, you have to make sure you don't get crushed under the wheel of another's cycle. I believe Japan has nominally bottomed but you can't start taking positions yet. Not until the BOJ starts pumping. If they don't pump, any rally will be another bear market rally. Nominal bottom doesn't mean price bottom, it just means trading shorts have to start looking to cover.You have to see simultaneous short covering rallies in the yen, NIKKEI, and oil, on news of BOJ pumping. There is another consideration. The convertibility of yen denominated assets. Japanese stocks would still be good % returners at least initially, but you have the implied weakness of the dollar to take away some shine. When markets go to extremes emotion dominates and so you get big whipsawing volatility. When you try to jump in on the above mentioned evidence, even if there is only a few players around, the sellers won't sell but at a huge premium. Mostly the spike reversals are ephemeral; someone got the bottom tick, but they didn't have a clue about what was going on when they entered the order. You might take a look at the DOW chart Aug - Oct of 1974 for my best guess as what will develop. That was the so-called "Nixon sell-off", but Nixon's resignation was incidental. It was the completion of the over-institutionalization of the stock market which began in the mid '60s. The structure was a waterfall decline, a trough, a rally, which failed into a double bottom, a crossover establishing the second bottom, and then a short covering rally that began with 2 consecutive days in a row of at least 2 times daily average volume. I remember this well because I went long on the morning of the third day all alone in a brokerage house throwing every last cent at the market. I did that because the market failed to resume a second waterfall and put in place the crossover. The crossover was the key that showed the market was totally sold out. Japan is still in August.