I agree...i will buy puts based on the Vacationing Bill Indicator
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If anyone hears when the Masked Prognosticator will be on ..let me know ;-)))))))))))))))
and I will take this indicator...thank you very much: "The relationship between the Installment Debt Indicator and the Standard &
Poor's 500 Index is one of the most jealously guarded secrets in this business"
To: +james ball (6481 )
From: +Les Horowitz
Saturday, Aug 29 1998 11:15AM ET
Reply # of 6483
Interesting article on market gurus from Barron's:
Market Gurus' Tricks Exposed!
By Joe Queenan
In the past two years, Fox TV has attracted enormous audiences with a
series of specials entitled "Breaking the Magician's Code."
In each of these fascinating, inexpensively produced programs, a masked
magician performs a famous trick, then reveals how the trick is executed. The
specials have drawn so much attention that professional magicians have
brought a lawsuit against Fox, charging the network with violating the Uniform
Trade Secrets Act by revealing how a trick called the Table of Death works.
A related lawsuit names not only Fox and the
show's producer but one Leonard Montano,
known professionally as "Valentino," who is
suspected of being the Masked Magician, and has
thus become a pariah among his peers.
Practitioners of the magic arts claim that the Masked Magician is putting them
out of business. According to one magician cited by The Wall Street Journal,
"several of his magic tricks have lost their value and are now unperformable."
Astoundingly, the furor surrounding Fox's magic shows is nothing compared to
the burgeoning controversy stemming from another series of amazingly popular
TV programs entitled "Breaking the Market Prognosticator's Code."
In this group of riveting programs, which have been shown on various cable
stations throughout the nation, a masked stock market strategist identified only
as "Guru" first uses a mysterious term such as "earnings momentum" or
"quantitative stock-cash model" to describe the market's recent activity, and
then explains precisely what the term means.
"It doesn't mean anything," says the Masked Prognosticator, whose real
identity is a subject of intense debate among his colleagues. "It's just that
investors feel better if you say, 'The market went down 289 points today
because of an anomalous deviation from our quantitative stock-cash model,'
than if you say, 'How the hell should I know?' The term 'quantitative
stock-cash model' was actually dreamed up by two Taiwanese exchange
students at Texas A&M who don't speak any English."
The phenomenal popularity of the "Breaking the Prognosticator's Code" series
has infuriated Wall Street professionals who make their living by forecasting
the imminent direction of the stock market.
We contacted every single famous Wall Street market pundit to get his or her
on-the-record opinion on this groundbreaking program. And Barron's Online
has learned exclusively that like their brethren in the prestidigitator's profession
, they, too, are contemplating legal action. In fact, rumor has it that they've
retained Johnnie Cochran to represent them, but we couldn't confirm that.
"The relationship between the Installment Debt Indicator and the Standard &
Poor's 500 Index is one of the most jealously guarded secrets in this business,"
proclaims Wall Street legend Marty Zweig. "To have this Guru joker come on
television and explain how this indicator works is a complete and utter outrage.
He could put all of us out on the soup line."
One of the most infuriating elements in the series is the Masked
Prognosticator's penchant for explaining the most arcane, abstruse terms used
by members of the tight-knit forecasting cabal. Abby Joseph Cohen
undoubtedly speaks for many of her colleagues when she excoriates the
television shows for demystifying terminology that took years, even decades,
to develop.
"No one really minded when the first show aired and this character explained
terms like 'Advance/Decline Indicators' and 'Yield Curve Slopes,' because that
stuff you could look up in the library," the usually unflappable Ms. Cohen says.
"But when I turn on my TV and see this guy divulging the mysteries of
'Classification and Regression Trees' and 'Discounted Future Earnings
Models,' it makes my blood boil. People in this profession have worked long
and hard to keep the public in the dark about the meaning of these terms. Hey,
what's wrong with a little old-fashioned mystery?"
To date, the identity of the Masked Prognosticator remains unknown, though
suspicions about his identity abound. Some say it could be Barton Biggs,
others Byron Wien, still others Ed Yardeni
"And let's not forget: Chuck Allmon's been bearish for years," says Elaine
Garzarelli, who became famous by predicting the 1987 meltdown. "So some
people think it could be him under that mask. But even though they use funny
camera angles to hide his identity, it's obvious that the guy is tall and lanky.
Personally I think it's Jim Grant. I wouldn't put anything past him."
Charles Clough disagrees. "There's a sneering, know-it-all quality to the
Masked Prognosticator's voice, which makes me suspect it's Jim Cramer,"
says the Merrill Lynch strategist. "The way he seems to smirk when he uses
terms like 'Downdraft' and 'Allocation Model' makes him sound like a bit of a
wiseacre. That's why I'm sure it's not Barton or Ed. Though it could be Bob
Prechter."
Whatever the identity of the Masked Prognosticator, Wall Street's most
celebrated market mavens have banded together to sue the producer of the
shows for divulging trade secrets. Last week, a federal court in Atlanta issued
a temporary restraining order, preventing the airing of an installment in which
the Masked Prognosticator meticulously explains what the terms 'Momentum
in T-Bill Rates' and 'Head and Shoulders Formation' mean.
"And not a moment too soon!," exclaims Ralph J. Acampora of Prudential
Securities. "Only five people on the face of the earth know what a head-
and-shoulders formation actually means. If this guy is just going to give this
information away to the public, the rest of us might as well close up shop right
now.
" Just as nobody understands how a magician can stick 15 knives into a
woman's head without killing her, nobody understands how you can use a
head-and-shoulders formation to predict when the next downdraft will trigger
a 'flight to quality,'" the voluble technician continues. "If everybody's going to
know these tricks, what's the point in having market gurus in the first place?"
Indeed.
>>>Since the Dow is price-weighted, it understates the declines in
>>>the average Dow stock which is just about 20%. Les H.
>>>Below is a snippet from a story on insider buying in small to
>>>mid caps:
Those who watch insider trading full time say this change of heart by the
people who know their businesses best may be a strong signal that the market
is nearing a bottom. Furthermore, the buying seems to have intensified in the
last month, even as the broad market was in full swoon, they say.
George Muzea, who heads up the Reno, Nev.-based Muzea Insider
Consulting Services, says, "almost all of our analysis of [recent] aggregate
insider data is positive. In the past, unanimity such as this has often occurred at
significant stock market turning points."
Richard Cuneo, editor of Vickers Weekly Insider Report, adds that his
research shows the trailing, eight-week average insider sell/buy ratio was a
"very bullish" 1.09:1 as of last week. Normally, the ratio is 2:1, and at the
beginning of May it was a bearish 3.19:1, according to Vickers. The
implication, says Cuneo: Insiders believe that the things that are rocking the
market -- Russia's woes, fears of a Chinese devaluation, President Clinton's
problems -- have nothing to do with the U.S. economy.
Furthermore, there have been
"dramatic" turnarounds in sentiment
among some market sectors, adds Bob
Gabele, whose CDA/Investnet research
firm tracks insider activity. Technology,
chemicals, paper and forest products,
aerospace/defense and energy stocks all
have shown big shifts to net insider
buying from selling in a very short time,
he points out. That shouldn't be a
surprise, because those groups have
been among the worst-performing
sectors in the stock market this year.
At the other end of the spectrum, corporate officials at retail, broadcasting and
television, advertising and newspaper/publishing companies are still selling
shares, according to CDA.
Gabele notes that insider purchases are "concentrated in the small to
mid-caps." Again, no surprise, since many small-cap stocks are already down
20% or more, the definition of a bear market. Gabele is more cautious about
the activity in large-capitalization stocks, where, he says, insiders are generally
abstaining from selling shares rather than buying stock in the open market.
While Gabele asserts that it may yet be "a touch" early to conclude the market
has hit bottom, "I'm inferring that there is plenty of value here."
------------------------------------
To: +Ken Adams (59 )
From: +Ken Adams
Saturday, Aug 29 1998 9:48AM ET
Reply # of 67
All...
How low is low? I keep tabs on the number of NYSE issues that trade above their 200
day SMA. For the nearly 7 years of history I have on this indicator, Thursday and
Friday saw it fall to its lowest level ever. Only 19% of NYSE stocks now trade above
the 200d SMA. That means 81% of all stocks are below the average.
However, it also may mean the end is in sight for this bear market. In March of 1993,
the number above the 200d average was 78%. This began to shrink from that point and
fell steadily into late 1994 where it bottomed out at 20%.
In early October, 1997 this number reached a record high of 85% and began to fall. It
has been an up and down trail since that high, but the overall trend has been down, in
spite of rising DJIA prices. Fewer stocks in rising patterns overall, while the blue chips
made new highs. The NYSE advance decline line hit its peak on April 9 of this year,
trailing the "Over Moving Average" indicator by about 6 months.
Cyclically, this bear could last another month, but it's probably time to start watching for
some buying opportunities.
Comments welcome, Ken |
