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Strategies & Market Trends : A.I.M Users Group Bulletin Board -- Ignore unavailable to you. Want to Upgrade?

To: JZGalt who wrote (5717)	9/22/1998 4:51:00 PM
From: OldAIMGuy	Respond to of 18928

Hi Dave, I got smart since that post earlier this AM. I managed to download Adobe's reader and can now view the document without having to wait for the GIF files to load. Much easier. Best regards and thanks, Tom

To: JZGalt who wrote (5717)	9/28/1998 7:40:00 AM
From: OldAIMGuy	Read Replies (2) \| Respond to of 18928

Hi Dave, Another aspect of the macro-economic conference I attended last week was discussion on what the "next shoe" might be if there's still one to drop. The discussion was that the US economy was strong and that consumer spending has kept it going in the face of considerable negative pressure from outside. The threat of real recession, if the rest of the world remains as is, can be reduced quite a bit by a reduction in our interest rates. The real question remains what will happen to the China currency. If they devalue their currency by a large amount, the impact will be so great that Mr. Greenspan's toolbox for economic adjustment will be depleted very rapidly. As investors, whether China devalues or not is out of our control. However, as AIM investors, we will know how to react should our economy fall for one or two quarters into recession. Opinion was that the end of the calendar year and the first quarter of 1999 are somewhat critical. Mr. Holland gave the three "C's" of investment cycle: Complacency Concern Capitulation We've had Complacency all the way through part of 1998. Now we're in the Concern stage in his opinion. He doesn't feel that the large volume sell-off was necessarily the Capitulation that the market needed to start another full cycle. He did say that there is a difference between newer market down turns and ones in the past. Things happen very fast. About 1/2 the stock market's shares are held by institutions of various forms. About 85% of the daily volume is represented by the institutions. So while the institutions play their musical chair games, we private investors see our half of the market's float get whipsawed. I'd say that puts AIMers in a unique position. We should be the beneficiary of the herd mentality that seems to rule the institutions. I picked up a new "rule of thumb" at the conference. I've always like seeing that there's healthy ownership of shares by officers and directors of companies. I like it when they put up their own money in the same enterprise as I'm contemplating. Ken Janke of National Association of Investment Clubs suggested that officers should have the equal to one full year's salary invested in shares of their company. If the guy makes a million a year, he should have a million at risk in the company! He felt that directors annual fees should also be based upon this same formula. If they get paid ten grand for being on the board, they should have at least that amount at risk in the company. I'd not ever had a way of quantifying "insider ownership" before, but I like his formula. Now I'll have to check all of my stocks against it!! One final note on the demographic shift in the US: In the '60s Americans smoked pot and took LSD; In the '90s they take Rogaine and Viagra!!!!!! Audio version of the conference is at wisc.edu Best regards, Tom