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At 10:43 AM 12/24/99 -0800, James Taylor wrote:
>No matter how ridiculously high this market gets, I would bet that the
vast majority of the folks who are bearish today will not suddenly become
bullish. They are bearish for a reason -- the fundamentals are so far out
of wack. If the market climbs, they will only become more bearish.
>
>The idea that everyone must be bullish for this mania to end is a
misconception.
>
>James
>
Let's look at the position on the money manager who is out of the market
today. He (she) must to invest the capital into market at some point as
market is moving higher (or it will be no capital to invest, as clients
will withdraw their money). And when all available capital is invested
market will stop going up. Then money managers will start their "rotation":
selling some stocks and buying another in hope to "squeeze and scratch"
some more return. Market will move sideways (stock A is up a point, stock B
is down a point). When there is no more "rotation ideas" and bonds start
looking "good" the selling will starts. Market will go down. When everyone
sells then we will start the marked game all over.
Alex.
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