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To: Bill Harmond who wrote (16011)	9/3/1998 7:48:00 PM
From: Oeconomicus	Read Replies (1) \| Respond to of 164684

Bill, re GE, that is truly ominous, especially coupled with the bottomless trannies and continued drop in bond yields (in spite of probable Japanese selling). As those of us who have been around more than three years know, the market will signal a coming recession long before any of the economic stats start showing it. Thanks for pointing out GE's chart troubles. Bob

To: Bill Harmond who wrote (16011)	9/3/1998 9:00:00 PM
From: Mark Fowler	Respond to of 164684

Just an observation...General Electric, bluest-chip, broke 200-day simple moving average Monday, and broke its Tuesday low today on expanding volume. << Thanks William, i'm not convinced it's over yet. The financial stocks are taking another beating. JPM looks like it's falling of the chart. Transportation index down more. Inversion in the yield curve suggests deflation 12 to 18 months out( never been wrong before) a problem the Fed has never had to deal with and not good for heavily leveraged companies, etc. I'll say a decrease in short-term rates is in the cards, perhaps up to 75 basis points. Commodity index now below 200. I'll continue to be on the sidelines till i see some positive movements in the small caps and financial stocks and other major indexes. Perhaps investors and institutions are waiting until after the holiday. I'll be looking for signs of a September rise.

To: Bill Harmond who wrote (16011)	9/3/1998 10:26:00 PM
From: Mark Fowler	Read Replies (2) \| Respond to of 164684

Another observation, the SPX's PE after the correction is still high on a historical valuation basis. Can the current economic environment still support these valuations? What if the S&P corrects to an 18 PE or below, then we still have quite a ways to go on the downside. The chart isn't quite up to date, but you can easily see where we were and where it could drop further. Take a look marketgauge.com This fund shorts the S&P crosses well above the 200 day MA: quicken.excite.com Same chart --5yr. quicken.excite.com