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

To: robert b furman who wrote (22693)	7/29/1998 11:16:00 PM
From: bobby beara	Read Replies (2) \| Respond to of 94695

Bob, there may be something to what Thomas C is getting excited about. >>>So why is the future profitability of our corporate sector deteriorating to justify a crash?<<<< Valuations are stretched at historically high valuation levels based on a high level of (irrational?) expectations. The real world conditions of declining earnings, Asian problems, etc. have been ignored in the bubble mentality, new era momentum trading, bringing stocks even more out of line that many value managers considered out of whack for years. If the bubble has been popped and you consider that the general MARKET PEAK IN APRIL, and this last run-up was a bear market rally of just a few high flyers dragging the indices, we could be in a dangerous period here. If we are on the other side of the peak, crowd behavior will take on a whole new mentality. Panic is not out of the question, when the crowd finally realized the tulip they bought (AOL had as big or bigger a market cap than 11 Dow stocks) is way way over priced. Markets don't usually crash off price peaks, but then again I hear old time investment pros saying they have never seen such a thing as this internet mania. Will this time be different? It just might. wantabee

To: robert b furman who wrote (22693)	7/30/1998 3:28:00 AM
From: Thomas C (Hijacked)	Respond to of 94695

Rob, I am not sure I am of the opinion that interest rates are the only determinant of huge moves in stock prices. What happened at the peak in 29? can you tell me that? My investments are value oriented but in a crash and subsequent bear market I dont care what they are because I am in cash. But occasionally I think speculation can be a good thing when one has the right tools. No I don't enjoy panic or am I alarmist. The LAST THING I want to see is trillions of dollars of equity wiped out in a New York minute. That would be devastating, considering how many lives are built upon this stock market. I am simply looking at the market and trying to gauge what is the most likely scenario based on technical/psychological factors and what has happened in the past. And I have looked at what happened in the past on a technical basis, 1929, 1987 and other times and I am telling you that the current technical condition of the market, the charts, the MACD histogram is giving an absolute huge sell signal. Just like it did in 1929 and 87, bar none. It does not guarantee a crash, but the odds are very high for one based on the interpretation of this indicator. We are just completing a triple bearish divergence on the Nasdaq now. The signal line is almost ready to break into the open on the Histogram and every time in the past that has led to big declines. So i can almost guarantee that the next 3 weeks will be time for the BK. If I am wrong you can rub it in but I see the odds very high we are ready for the big one... TC