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To: Jim McMannis who wrote (42953)	1/11/1999 9:07:00 AM
From: James H. Williams	Respond to of 97611

I believe it was written by Burton Malkiel and the thesis as I understood it was that by buying and holding pairs of stocks that do well at opposite times, you can, over time, beat any other trading strategy. He also spends a lot of time reviewing different strategies. Anyone please correct me if I got it wrong.

To: Jim McMannis who wrote (42953)	1/11/1999 9:21:00 AM
From: Christopher	Read Replies (1) \| Respond to of 97611

Jim, The Fed is charting now and believe in TA. You know what they say, the proof is in the pudding. The paragraphs below show the Fed Reserve have some doubts about the random walk since they call it "simple" when they say "The simple Efficiency market hypothesis" and starting to believe more in the "profitability" of TA. The following are articles published by the Federal Reserve: In August 1995, the Fed Reserve of NY published staff report under the title "Head and Shoulders: Not just a Flaky Pattern." The paragraph below is the opening sentence in their introduction: Technical analysis, the prediction of price movements based on past price movements, has been shown to generate statistically significant profits despite its incompatibility with most economists' notions of "efficient markets."(Federal Reserve Bank of New York, C.L. Osler and P.H. Kevin Chang, Staff Report No. 4, August 1995.) A more recent report, published in the fall of 1997 by the Federal Reserve Bank of St. Louis says the following: The success of technical trading rules shown in the previous section is typical of a number of later studies showing that the simple efficient market hypothesis fails in important ways to describe how foreign exchange market actually function. While these results did not surprise market practitioners, they have helped persuade economist to examine features of the market ... that might explain the pofitability of technical analysis. (Neely). Good trading and don't forget the box of Kleenex!! Christopher