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Jack, ....wunderbear calling,..... come in please.
On the matter of the inflated fund flow numbers you cited below here is a
sign that things are changing quickly posted today:
NEW YORK (CNNfn) - Investors
pulled a net $3 billion out of stock
mutual funds in the past week,
according to Trim Tabs, a newsletter
that tracks mutual fund capital flows.
If this pace continues, it could be
the first net monthly outflow since
September 1990, just before the Gulf
War, said Trim Tabs research director
Carl Wittnebert. As it is, August looks
like the lightest month of stock-buying
since 1991.
>Date: Sun, 30 Aug 1998 22:31:22 -0700
>To: Trade Jack <trade_jack@xxxxxxxxx>
>From: Michael Paauwe <mpaauwe@xxxxxxxxxx>
>Subject: RE: Russia - Problem - what problem?
>Cc: Omega-list@xxxxxxxxxx
>
>You might be right TJ, but on August 4th 1998 a bear market signal was
generated under classic Dow Theory, is all. Dow Theory is reasonably solid,
even mechanically, and has been around since long before you and I were
born. In a mechanical model it actually works really well going back several
decades 605 to 70% of the time. In the last couple of years it hasn't
worked that well.
>
>The thing now is there is solid confirming 'tape action' triggering the
signal but then when you look behind it, there seems to be a whole pile of
fundamental analysis that supports the theory as well. Mainly to do with a
collapsing world wide commodities market, at a 20 year low, a collapsing
worldwide currency market generally at a multi-year low and lately even a
collapsing worldwide stock market, some at multi year lows. Real estate has
also collapsed in Asia, China and Hong Kong and across a wide spectrum of
other markets as well.
>
>
>But you are right, that doesn't mean the stock market will not go back up
again and resume the SUPER LONG TERM secular bull market that extends all
the way back to the 1850's. As long as YOU don't end up like a piece of terd
stuck on the down dip of the long term chart.
>
>At 01:17 PM 8/29/98 -0700, you wrote:
>>my comment to the wunderbears out there: 100 to 200 bil USD per month
>>is automatically flowing into 401K's and IRA's regardless of whether
>>the market is up, down, or spinning out of control.
>>
>>my question to the wunderbears out there: where is all that money
>>going to go if not into stocks? are they (mutual fund managers) goin
>>to park it into 90 bills? suuuuure. it sure ain't goin into
>>commodities or hard assets. maybe bonds while stocks sort themselves
>>out.
>
>Money managers are a joke actually when you look at how few of them can
equal even the market.
>
>>the arguments for a primary bear market are as logical as a snake oil
>>saleman selling the new wunder system;
>
>Actually nothing to do with snake oil. The promoters are the snake oil
guys. You rarely find people promoting a bear market. It's a no no.
>
>>but when you do some diggin, you realize it nothing more than fool's
>>gold.
>
>Who is the fool right now TJ, the buyer or the seller? Tell me.
>
>Also tell that to the IMF. And tell it to Chairman Greenspan and the rest
of the of the FED -- and tell it to Congress too. Read his last comments to
Congress. Are you saying he is a snake oil salesman too???????? And was to
Congress?
>
>if we're in a new paradigm economic model like i believe, then
>>the old way of analysis will not cut it anymore.
>
>
>Give us a lesson on the new economic paradigm you are talking about. How
does that relate to Price Earnings Ratios and how is it new actually? And by
the way, what does that word paradigm actually mean anyway?
>
>
>>i believe that we are in a normal bull market correction of an ongoing
>>bull market. take a look at the last correction in the s&p in the
>>april/may 98. compare it to the current correction. i see fractal
>>similarities, the only difference is in scale.
>
>
>Can you explain what a fractal similarity is? And have you back-tested it?
>
> the current correction
>>is much larger to be sure, but that is normal and healthy. with all
>>the news swirling around regarding russia, china, asia, latin america,
>>and mexico, it is nothing more than another wall of worry for the bull
>>market to climb.
>
>>another point. i received in the last month more mail from
>>newsletters warning of market collapse, panics, and global depression
>>(10 to 1) than for the bullish case. not a scientific sample, but too
>>many, too quickly, are jumping on the bear bandwagon. i even heard
>>the bear word uttered lately on CNBC! this psychology is typical of
>>bull market corrections, not new primary bear markets.
>>
>>but then again, i could be wrong
>>TJ
>
>Good point.
>
>
>
>>---Brian Massey wrote:
>>The markets are simply a giant ferris wheel for the world's cash. It
>>flows from one sector or country to another and then eventually back.
>>
>>yes, Brian, i agree
>>
>>
>
Michael Paauwe
mpaauwe@xxxxxxxxxx
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