That is one of the best reasons to short an overpriced LU. I just do not have the patience to wait 2 to 3 months.
Given the current environment, (including the possibility of a small interest rate increase), the general bias of the market seems to be still to the upside.....
Other than "day/short term trade" to short LU under the current environment is really asking for trouble, simply because there are other stocks that the risk/reward ratio to short them are far better than Lucent.
Besides, your statements seem to be contradictory.
Being "long and confident" in this market is as close as one can get to complete lack of responsibility. As in 1987 as now interest rates rise in tandem with the market.
While I do not eliminate the risk possibilities of a general market down turn...(see August-October of last year), the comparison to 1987 is not applicable, (same with the comparisons of the alarmist hens to 1929).
Why ?
Because interest rates are much lower than in 1987, so even if the Fed were to increase rates, the risk is not as great as then. In addition, market conditions (including the global perspective), that the risk of a substantial interest rate increment would have in foreign markets such as Russia, Brazil, Indonesia, Mexico, and others, limits the Fed in their potential aggressiveness to increase rates.
Further, it appears that earning results of most (read the most efficient), companies seem to be coming out o.k. (if not, the market will punish them accordingly), so in a way is a "self cleaning" mechanism --not necessarily, or always efficient, but still, the small "brakes" that we seem to be suffering here and there, seems to be giving fuel to more efficient companies, or undervalued companies to take the slack....
Has the bear market which started in 1972/73 last for ever?? No will the bull market who started in 1982 stay for ever - also NO.
Nobody is suggesting such, indeed, if I remember well, we had a small bear market in 1991, remember ? "No More New Taxes" ~George Bush.
Then the Democrats conned him into.... "changing his mind".. (as all politicians conveniently do, claiming he suffered of Politician's Alzheimers)... that sure gave us a bear market, (not to mention the opportunity for Bozo to become elected as President).
Finally, while I do admit that the Internet Mania has some companies well overextended and at some valuations that are simply not justified, I believe that the Internet is creating a drastically different environment where business will be conducted far more efficient and for the specific companies that have the product/service AND STRATEGY to take advantage of this new environment, they will benefit tremendously...
So far, I have heard that we will have a serious crash since 1994 continuously, (which thanks to Mexico and the Orange County biggest moron, we nearly did....), I think we had a slight increase in interest rates then... yet the market, once again, promptly set those worries aside.
It is a brave new world.... (no it is NOT different this time), simply, as I said earlier, we have drastically different environment that no one really knows how far we re going to get.
All of the above, together with the fact that the US Dollar, and economy is now seen by many, primarily outside of this country, as a bastion of safety and stability. The new army of day traders and investors participating in it, creating a sea of liquidity that pours into this casino, every day adds to the argument for the bulls...
"Don" Alberto Greenspanini (a venerable and well respected Mafia Don), would never push the market over the edge... I mean to say, he is the same man that in essence "saved" the market in 1987, why would he brake it now... It is a well crafted scheme, he will scare the hell out of the market, (as he just did on Tuesday), but he will never actually kill it...
Remember that an added benefit for all concerned is that the wealth created by the stock market is saving everyone, (including the government), from the potential disaster of the government run Ponzi sch... oops, I meant to say, the Social Security System...
Do you really think that the Fed, as independent as it may be, they are not a crazed group of trenched coat renegades that is about to be the cause that would crash this market big time.... I am not suggesting that the market could not do itself in, (it certainly has the capabilities), but the Fed, and the Mafia Dons that are at the helm are not relatives of Ted Kasinsky, Ted Bundy, or Quasimodo either, they will discipline the gamblers in the market, but they will not bring it down, it is in their best interest not to...
Again, I am not suggesting that every stock will continue the march on to higher prices, but the case, for the time being, continues in favor of the bulls....
And Lucent, is probably one of the safest stocks to bet with, but you are certainly welcome to short it, someone has to take the other side.
Remember that at $60.00 (that is $120 pre-split), is hardly a bad performer...
I certainly welcome your dissenting view, since as I said in an earlier post, we need to increase the volatility for Lucy so the premiums return to former glory.
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