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At 03:44 AM 4/7/98 -0400, TheGonch at MediaKat wrote:
>I have been reading on the history of financial manias and panics, to
>understand the mechanisms that will cause this market to eventually
>fall.
The bulk of money coming in is from funds and most of these funds do not
short via their perspectus. Considering that, and looking at alternatives,
(ie: money market funds), they have little to gain from a
correction/reversal. Also, many of the current people in this market have
never seen a bear market and probably don't believe it is actually possible
for equities to go down nearly every day just as they have gone up nearly
every day. They will see any dip as a buying opportunity rather than a
danger sign.
On the other hand a great deal of money is coming in from foreign investors
and they are likely to have little patience for anything less than a raging
bull situation.
Watch for the flight to quality .. this should drive the telecom group up
even further along with the electric/water utilities. For me, that will set
the stage for what has to be a huge drop that will at least bring P/E ratios
into line with a symblance of reality.
Bob
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