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

To: SkyDart who wrote (26322)	9/3/1998 2:38:00 AM
From: flickerful	Respond to of 94695

jeffrey. thanks for the zweigspeak.....very interesting. flick

To: SkyDart who wrote (26322)	9/3/1998 7:26:00 AM
From: Tommaso	Read Replies (1) \| Respond to of 94695

I have not read Zweig's book, but you have summarized most convincingly what sounds like its most important points. The yield curve is almost flat, and some early maturities were higher than the 30-year bond. That makes it a half "naughty boy" already. Looks like there's enough there, with deflation in commodities and manufactured goods, to say that we have a two "bad boy" count, or a 50% decline. It could easily get worse. I am pessimistic enough to be borrowing the maximum cash value from my life insurance and putting it in the bank for the time being, though that means in effect renting my own money at about 2% a year. At least it will be there for reinvestment. I already have enough in short positions (including SPY) and in BEARX to do well in a declining market, and having an insured cushion in plain cash makes me feel comfortable. I had some trouble borrowing from the same policy in the 1970s. I sure wish Wall Street Week would put Marty Zweig on. Have they ever had Tice on it? At least CNBC does that. Thanks for the very informative and thorough post.

To: SkyDart who wrote (26322)	9/3/1998 9:03:00 AM
From: Terry Whitman	Read Replies (1) \| Respond to of 94695

Jeffrey, Nice article. On the possibility of deflation: Last night on Nightly Business Report they hosted a commodities technician. I didn't catch the whole bit, with the kids screaming and all, but here's what I gathered- He posted a chart with the commodities index overlaying the 3 month T-Bill rate. The chart, going back 20 or 30 years showed that the commodities index led the T-bill rate by 4-6 months. The last several months have shown a huge drop in the commodities index, and a flat T-bill rate (4.8% I believe). He further stated that every instance in the past where the commodities index fell below 200 resulted in DEFLATION. Every damn time. In conclusion 1) Deflation is now a certainty. 2) Interest rates are going to fall considerably (maybe as low as 2.5%), and will start falling soon. According to Zwieg, this is not a good signal for the stock market either. One would have to be either blind or just brainwashed to go long the stock market now. Happy selling, TW