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Strategies & Market Trends : Bill Wexler's Profits of DOOM -- Ignore unavailable to you. Want to Upgrade?

To: Pancho Villa who wrote (3455)	10/8/1998 11:24:00 AM
From: Druss	Read Replies (1) \| Respond to of 4634

Pancho--I am concerned about what I see in terms of buying also. Investors that saw all this coming because of numerous factors they could see in the market are now seeming to expect a quick turn around. We have been in a bull market for 7+ years there is no reason a bear can't hang around for 2 or 3 or more. Many of the factors that brought the bull down are still there (poor banking practices, Asia, wild speculations on various stocks and market sectors, and low corporate earnings). Some have not made themselves fully felt. I agree with you the market may head down further and to my mind may stay there longer than so many people expect. All the Best Druss

To: Pancho Villa who wrote (3455)	10/8/1998 12:05:00 PM
From: Don Westermeyer	Read Replies (2) \| Respond to of 4634

Pancho, FWIW - I've been closing up my short positions. The recent correction has really been a sharp knife to many of the balloon/scam/tulip stocks in this market. I've thrown some money into some 'value' stocks. I've also been pretty successful for the last few months by playing stocks that have buyouts in progress (only cash deals for me though). For instance today it was announced MECK (IMO a real value play in the internet area) will be bought for $29. The stock is still trading at a $2+ discount buy should be completed by the end of November. There is always some risk that these deals don't go though, but I'll take that kind of risk over market risk these days.

To: Pancho Villa who wrote (3455)	10/8/1998 12:35:00 PM
From: Graeme Smith	Read Replies (1) \| Respond to of 4634

Pancho, I actually agree with what you say (especially since the market is well proving you right today). I do think I should have waited a little longer. I have two portfolios, one of which is still equally weighted long and short (although effectively biased towards down markets because the shorts are smaller and more volatile). The other portfolio I am slowly moving to be more long than short, but maybe a bit prematurely. At the moment I am not quite sure which way to go. I have two opposing trains of thought. Firstly, quite ironically, fundamentals have been crap for a long time. But now that they are actually beginning to improve, the market has suddenly realised that they have been crap for a long time and panicked. The dollar is dropping, which takes some of the pressure of the asian and latin american currencies. Also I imagine that the people most hurt by the dollars collapse are those that had been betting against other countries currencies. Most importantly it means that for tech companies profits next few quarters will be better because of the exchange rate. Secondly Greenspan has pretty well just said that he will be lowering interest rates further, though I guess this will be mediated by the low dollar. On the other hand I think small investors have finally realised that the market doesn't always go up. That it doesn't always rebound after a drop. One of my favourite CNN news pieces 2 months ago was about how all the loser Fund Managers had panicked and started selling off, whereas all those smart small investors had beaten the pros at the own game and smartly held on for what was bound to be higher returns. I guess the small investors didn't have the last laugh today. Overall in my opinion, I think we are in a panick market where small investors have suddenly realised markets sometimes keep going down, and are bundling out. I don't know how much longer it will last (my guess is the end of today). After that I think we will get some bottom picking, with some realisation to that profits may be helped by the weaker dollar, and also a drop in interest rates. Longer term I think we will still stay in something of a bear market with each peak getting gradually lower. The market always goes to extremes. A quarter ago we were in an incredible extreme of optimism, with the market somehow hitting new highs while the rest of the world collapsed. This quarter I think we a slightly oversold (though not much), with the overall picture no worse than a quarter ago (I don't think US will go into recession next year) but the Nasdaq at almost 40% off. Graeme