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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: James F. Hopkins who wrote (22268)	7/24/1998 6:00:00 PM
From: epicure	Respond to of 94695

Wantabe, being the key word in that post. Oh how I wantabe.

To: James F. Hopkins who wrote (22268)	7/24/1998 9:07:00 PM
From: bobby beara	Read Replies (2) \| Respond to of 94695

Weekly reversals for the wantabe timer -g- If you look at a candelstick chart weekly on the Nasdaq, weekly reversals like the one we just had were followed by short term bear markets of 4/97 and 6/98. and were followed by short term bottoms of 10/27, 12/19/97, 1/12/98, by one to two weeks. Verdict, the highs next week should be a good selling opp. bwantabeIK, bb

To: James F. Hopkins who wrote (22268)	7/24/1998 9:55:00 PM
From: William H Huebl	Read Replies (1) \| Respond to of 94695

Fantastic Jim, I don't think it could be said better. Ask you know, I play both sides. I tried to buy BA calls when it was at 42 in mid-June for the move up but I went too cheap. Then when I saw the 200 day MA was DOWN, cancelled THAT order and went for puts, but too early... but thankfully far enough out to give the stock time to tank. NOW that it has broken the neckline of the H&S, puts are the way to go IMHO. Now if I can get the timing right THIS time, I might be able to REALLY make $$. Bill

To: James F. Hopkins who wrote (22268)	7/25/1998 10:56:00 AM
From: Tommaso	Read Replies (2) \| Respond to of 94695

Well, I am pretty close to the bear you describe. I hold (covered) short positions on GE, IBM, GTE, and even XON (because I have so many long oils). I am holding a SPY short that I intend to keep for as long as it takes. So far it's taken nearly nine months. I hold a large BEARX position. As you may expect, I am not happy, but neither am I that discouraged. In 1982 I was leveraged to the max (almost) with a large overdraft balance, maximum margin from my broker, and other debts, and holding as much of several closed end funds as I could buy--the ones with the biggest discounts: Baker Fentress, Central Securities, and Source Capital. I seem to have done well at market extremes in the past. I was all cash in 1974, but did not dare try shorting then. It remains to be seen if I am right this time.

To: James F. Hopkins who wrote (22268)	7/25/1998 11:15:00 AM
From: Tommaso	Read Replies (1) \| Respond to of 94695

Recent interview with John Kenneth Galbraith: The Observer: Would you generally approve of the way he [Greenspan] has conducted monetary policy at the Fed? Galbraith: Absolutely not. There should have been far more warning about the speculative splurge on Wall Street and the extent of citizen participation. That was the mistake that the Federal Reserve made in the Twenties, and the mistake that it has made again now. And the reason for it is simple: you cannot warn against a speculative splurge without taking responsibility for what happens thereafter; no head of the Federal Reserve wants to be held responsible for a dip in the stock market. Once or twice he has got close to saying that, and he certainly knows it. But nothing appeals so much to a central banker as personal caution. One thing is wonderfully clear - when trouble comes on Wall Street, the blame will all be passed to Indonesia, Malaysia and maybe Japan. Wall Street insanity - let me use a slightly milder expression, Wall Street 'speculative error' - now has a perfect cover. The Observer: If you look at the return on capital in the G11 countries, it has been rising pretty consistently since 1982. But clearly the graph can't continue up forever. Do you think we might be at a turning point now? Galbraith: Profits have been very high and growing. But returns from owning common stock, particularly in the major companies, have actually gone down to nominal levels. Dividend income of major stocks is almost insignificant. To own common stock that has a wonderful capital value and no income is a slight anomaly that only the better financial minds can explain. The Observer: With reference to Schumpeter and the Schumpeterian correction, to what extent do you think that we just have to go through the inferno? Galbraith: We could move much more aggressively than we are doing to clean up the situation, to make sure that we have common honesty in the operation of all these mutual funds, for example. One always worries that there may be some relationship between what a mutual fund is doing with its investors' money and what the participants in the fund are doing with their personal funds. There have been some cases of that in the newspapers recently. In the US we now have far more mutual funds than there is intelligence, perhaps integrity, to handle them. They are the bridge between the innocent and the eventual loss. This is a time when we should tighten, and be very certain about, the quality of our bank regulation. There should be strong warnings against investment in high-interest bonds. Nothing calls for more concern than the revival of the junk bond; while the problem of regulation is a bit difficult, we should look with some concern on this whole mergers and acquisitions binge. But having said all that, I would emphasise again that the sequence of speculative boom and its result is part of the market system (one cannot now use the word capitalism) and has been for hundreds of years. The market system has its considerable accomplishments, but one should never ignore its downside. The Observer: Do you think we are going to come back to a point when some kind of Bretton Woods system is needed, and some control of capital? Galbraith: One of our stronger points is that in consequence of the existing Bretton Woods system - if properly financed - we have a structure for easing what the financial community loves to call a correction. We should always bear in mind that, as is happening now in East Asia, the peculiar genius of the IMF is to bail out those most responsible, and extend the greatest hardship to the workers, who are not responsible, who are innocent participants. The Observer: Do you believe, and have you ever believed, there is any truth in the 'new paradigm' idea? Galbraith: When you see reference to a new paradigm, you should always, under all circumstances, take cover. Because ever since the great tulip mania in 1637 [when 'investors' bid up the price of bulbs to astronomical levels, even devising a system of call options on tulips they didn't actually own], speculation has always been covered by a new paradigm. There was never a paradigm so new and so wonderful as the one that covered John Law and the South Sea Bubble - until the day of disaster. The Observer: Would you agree that we should be worrying less about inflation now than we should have worried 10 or 20 years ago? Galbraith: You have to divide the situation in the US from that in the United Kingdom. In the US, we've managed to combine very high employment (or very low unemployment), with relatively stable prices. On the other hand, here in the UK, inflation has been a somewhat more pressing problem. We Americans have managed to put aside Phillips [the economist famous for the Phillips curve, describing the trade-off between inflation and unemployment]; but he's still relevant here. When all is said and done, the labour movement and the problem of the wage-price spiral is still stronger in the UK than it is in the US.