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Do you have a way of seeing a crash before it's over? How about Dow
Industrials at 9500? How close to your nose does it have to be?
-----Original Message-----
From: Jay Mackro <jmackro@xxxxxxxxxxxx>
To: Earl Adamy <eadamy@xxxxxxxxxx>; Real Traders Forum
<realtraders@xxxxxxxxxxxx>
Date: Friday, October 15, 1999 12:08 PM
Subject: Re: FOMC - "this time it's different"
>Earl:
>
>You had written:
>
>-----Original Message-----
>From: Earl Adamy <eadamy@xxxxxxxxxx>
>>The public won't sell until it gets scared and that will not happen
>>on a large scale until securities bought on the dips fall to significantly
>>(20%) lower levels and it won't happen on a massive scale until prices
drop
>>to levels at or below the average cost of acquisition.
>
>Yea, but, it's not as if most of the market is held individually.
>Sure, on TV, every housewife is using Ameritrade to buy AOL
>and Amazon from her kitchen - and no doubt, those investors
>will get shaken out in the event of a severe correction. But, I
>believe that the preponderance of the public's shares are still
>held through mutual funds, pension plans, and life insurance.
>John Q. Public isn't going to close out his 401K, and cancel
>his employer-provided term life insurance, just becaue the
>market looks scary.
>
>I'm not saying that a crash can't happen, nor that the public
>won't bail out of their individual investments if the market isn't
>going up every day. Such a scenario would be murder on the
>E*Trades and Olde's of the world. But I question whether
>the percent of stocks held in this manner really represents
>that high a proportion of the total shares outstanding. I have
>great faith in the promotional abilities of the institutions to
>convince their customers to continue to hang on.
>
>Jay Mackro
>
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