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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Lee Lichterman III who wrote (14044)	5/15/1999 2:11:00 PM
From: Casaubon	Read Replies (2) \| Respond to of 99985

damn it! I just lost a whole page of explanations with an unknown keystroke! I concur with the statement that money is flowing into dividend stocks. A week or so back I posted my observations about money flowing into REITS for that reason. It is a way of harnessing labor to preserve wealth, instead of parking capital in gold to store value (a dying concept, in my opinion). Labor camps would (and in some areas still do) indenture families, sometimes for generations, to skim wealth. Gold has no real value, labor does. This Bull is past maturity and eventually will correct from overspeculation. I don't see the return of the great depression, just a lot of lost capital. In fact, in some ways I think it will be an amusing hoax perpetrated on the most selfish generation of all time. Alan Greenspan, for all the bashing I have heard, has warned people too many times, but noone listens. People are buying stocks in companies and they don't even know what products they have or will have. Nor do they care, until it's too late. I am invested in a company that has, after eight years, developed their first product. They're still in the red, but I know the score much more so than most investors. Also, I'm willing to cut my losses, something the average investor knows NOTHING about. That is why all the talking heads were wrong about J6P being the cause of market crashes. The notion that they won't have the discipline to sit through market corrections is bass ackwards. In fact, they don't know any better than to sit through corrections. J6P doesn't know to cut losses and therefore gets left holding the bag (empty of course). So, where am I going with this? Well, I made the statement that the drug sector will lead. I meant in the next bull market...sorry, that's an important fact I left out. During the mean correction coming up they won't lead; successful dividend stocks will. Every bull market has an industry that leads the pack out of the valley of death. The drugs will lead the next bull market because of demographics (aging boomers who want more), and the ability to really deliver the goods. So you are absolutely correct, as your chart points out, the DRG is still in a downtrend. However, after the market corrects, drugs will lead a rally. Drug companies have full pipelines of innovative products, that really change lives. Whereas, we are more likely to see incremental improvements from other industries (tech, electronics, Auto, etc.). This enables drug companies to maintain pricing power and generate profits!

To: Lee Lichterman III who wrote (14044)	5/15/1999 2:50:00 PM
From: briskit	Respond to of 99985

L3, FWIW Drug sector touted in the following article (apologies if this stoops to the level of trashing the thread): Welcome to the Analyst Corner Gruntal & Co.'s pharmaceuticals analyst, David Saks Today's topic: Best Pharmaceutical Ideas for Beating the Market Long Term We remain extremely bullish on the pharmaceutical industry and recommend that investors overweight their portfolios with the drug stocks on our recommended list. In our opinion, drug industry fundamentals are the best ever, led by strong demand for prescription drugs. Superior growth is likely to be far better sustained than in almost any other industry sector. Growth should be supported by a dramatic increase in life expectancy, which in turn should drive the need for pharmaceutical products to treat the illnesses of an aging population. Many drug companies rank among the world's best and most admired companies in terms of profitability, consistent high growth, and shareholder value. For the first quarter, the group reported average total revenue growth of 15% and earnings growth of 17%. Despite all quarterly results either meeting or beating our expectations, drug stocks have recently sold off an average of 17% from their all-time highs. We consider this pullback to be an excellent buying opportunity, and we would step up and purchase stocks such as American Home Products (AHP), Bristol-Myers Squibb (BMY), Johnson & Johnson (JNJ), Eli Lilly (LLY), Merck (MRK), Pfizer (PFE), Pharmacia & Upjohn (PNU), Schering-Plough (SGP) and Warner-Lambert (WLA). We are also very upbeat on the mid-cap and small-cap drug stocks in the biotech group such as Amgen (AMGN), specialty drug delivery companies such as ALZA Corp. (AZA), Andrx (ADRX) and Sepracor (SEPR), and the generic drug company, Watson Pharmaceuticals (WPI). The information contained in the Analyst Corner section of the Multex Investor Network is not written, reviewed, edited or in any way endorsed by Multex.com, Inc. Though some of the contributors may aim to provide advice, Multex.com, Inc. has no such intent or involvement. Since these facilities are open to all, there can be no assurance as to the truth of any statement of fact, or of the value, reliability, truth, or purposes of any statement of opinion. Seek independent advice from your professional investment adviser before relying on any materials in these services. (Personal disclaimer: I spent all my money on drugs years ago, and therefore have no position in any current offerings).