Re: MKT - The "Big Picture"

["Earl Adamy" <eadamy@xxxxxxxxxx>]

I think it's a slam dunk to classify the stock market as being in a mania when
the general public perceives little or no risk in equities (vs CD's and
treasuries), believes that 20-35% returns are the norm, and considers all dips
as buying opportunities. Further, fund managers are no longer expected to manage
funds prudently but are skewered for holding cash.

Earl

-----Original Message-----
From: steven poser <swp@xxxxxxxxxx>
To: eadamy@xxxxxxxxxx <eadamy@xxxxxxxxxx>
Cc: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
Date: Friday, June 12, 1998 8:58 AM
Subject: Re: MKT - The "Big Picture"


>Earl -
>
>The mania idea is interesting. It is hard to say whether it is or not. I
>am re-reading Charles Mackay's "Extraordinary Popular Delusions and the
>Madness of Crowds" right now, and the one thing that appears different
>and why it might not be a mania is that, at least how he describes past
>manias, is that in those there was virtually nobody saying that it was a
>mania. Right now, there are alot of people who are making that
>suggestion. But, you don't need a mania for a correction/bear market.
>
>As for picking the top, u r probably right. I am making a forecast, but
>outside of sticking my toe in a couple of times, I would not be trading
>for a top. I hope that I will realize there is no top before it is too
>late (and b4 we get to the levels where I currently think that we will
>top). If I do pick it right (or anybody else does, for that matter) it
>will probably be after picking 5 tops before it!
>
>Earl Adamy wrote:
>>
>> I don't believe in the "New Paradigm". However I firmly believe we're in a
mania
>> and that manias take markets into territory which can not be justified or
>> forecast. Manias shoot bears down in flames and continue ever higher until
they
>> fall of their own accord. I have dozens of charts which suggest that this
market
>> has been overvalued for a couple of years, but the market doesn't care.  I
have
>> log price charts which show parallel after parallel with the 1920's, but the
>> market doesn't care. Fortunately, technical analysis gives us the tools with
>> which to measure greed and fear so we may have a clue when the tide has
turned.
>> Jerry's talk was interesting and he may be right, but I don't think there's a
>> guru or analyst around who can tell us in advance when the mania will end.
>>
>> Earl