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Comparing today's market to 1929 from historic standpoint...... there was a
rally where people thought happy times were here again and were more worried
about missing the next rally than the downside as has been the case since
the Mar/Apr lows. The fear and capitualtion did not happen until the lows
were taken out. I believe someone accurately pointed out in a prior post
the other concern is trade wars... during the Clinton admin there was a
increase talk of tarrifs and recently we have heard Bush speak of concerns
over foreign steel being dumped in USA. The last sequence which added fuel
to the fire and I hope we don't experience was the death of the FED
chairman. The remaining Fed members made the decision shortly after his
death to raise interest rates as they felt that he would have made that
decision at the time.
----- Original Message -----
From: "Ira Tunik" <irat@xxxxxxxxx>
To: <realtraders@xxxxxxxxxxxxxxx>
Sent: Sunday, September 09, 2001 10:06 PM
Subject: Re: [RT] 1929 Comparisons
> It will be interesting to see how it all plays out. I have more targets
to the
> downside.
>
> Dorothy Carter wrote:
>
> > I think that the public will increase the mutual fund redemptions when
> > obvious that March lows are not going to hold.. Last year they got duked
> > paying taxes on gains they did not have. I don't think they will hang
> > around for Oct. mutual fund year end to pay taxes again on gains that
don't
> > exist.
> > ----- Original Message -----
> > From: "Ira Tunik" <irat@xxxxxxxxx>
> > To: <realtraders@xxxxxxxxxxxxxxx>
> > Sent: Sunday, September 09, 2001 9:54 PM
> > Subject: Re: [RT] 1929 Comparisons
> >
> > > There are factors in this market that were not around in the 1920s and
> > 30s. The
> > > only thing that will allow a collapse of this market is the public.
Right
> > now
> > > we still have more mutual funds then ever before. To get a complete
> > picture of
> > > what is involved one would have to know what each of these funds is
> > allowed to
> > > invest in, how much of there total assets must be in stocks at all
times,
> > how
> > > much can they have in cash and what it would take for them to close
their
> > > doors. With trillions in various retirement and investment funds
> > deposited in
> > > mutual funds that must retain a stock position their only alternative
is
> > to
> > > rotate from one sector to another. The real crash will come when and
if
> > > redemptions start to accelerate and these funds start closing their
doors.
> > > Right now all you have is a minor retracement in the indexes. Yes
some
> > stocks
> > > are worth zero and others are down 90%, but there are still those that
are
> > > selling with PE ratios of 50 to 100. Because a company lost money
last
> > quarter
> > > doesn't mean that it is going out of business or that its growth
potential
> > is no
> > > longer there. I am not a bull or preaching a bullish scenario, I am
only
> > > pointing out that if this thing starts to snowball, it will be
redemptions
> > that
> > > do it. With over 2 billion shares traded a day, how long would it
take
> > to
> > > liquidate $4 + trillion dollars in stock assets? Until the public
throws
> > in the
> > > towel, I don't believe a real good old fashioned crash will occur.
Right
> > now
> > > the public seems to be, "fat, dumb, and happy". this is just one
mans
> > opinion.
> > >
> > > Dorothy Carter wrote:
> > >
> > > > Just wait long enough.. the DJIA and the small and mid cap stocks
where
> > the
> > > > money managers have been hiding will come under pressure as well..
The
> > > > strength in the DJIA has not been confirmed by any of the other
> > averages..
> > > > and recent weakness in Transports which usually leads to DJIA does
not
> > look
> > > > good for the bullish case.... The bullish case was that manipulating
30
> > DJIA
> > > > stocks and trying to run for 11000 would cause short covering and
that
> > the
> > > > NAZ would turn around and rally to follow the senior index....
Looking
> > at
> > > > the DJIA 30 stocks only a couple have held up and those have
downside
> > > > targets now.. If I owned the DJIA 30 stocks I would not be sleeping
at
> > nite
> > > > any better than if I owned the NAZ... probably worse as it has a
lot of
> > > > catching up to do... so to each their own bunk I guess......
> > > > ----- Original Message -----
> > > > From: "Ralph Volpe" <rjv@xxxxxxxxxx>
> > > > To: <realtraders@xxxxxxxxxxxxxxx>
> > > > Sent: Sunday, September 09, 2001 4:15 PM
> > > > Subject: Re: [RT] 1929 Comparisons
> > > >
> > > > > A chart was recently disseminated that was supposed to show the
> > > > similarities
> > > > > of the 1929 crash to the market today. Let me comment on that very
> > > > briefly --
> > > > > it's bunk!
> > > > >
> > > > > The collapse today has so far been a token crash that's primarily
> > > > affecting
> > > > > the tech stocks. Let me point out that the Dow has only lost 17
> > percent in
> > > > > nearly 21 months (and that's a good Fib. relationship). Investors
in
> > 1929
> > > > > would have been ecstatic with that type of decline. As well, the
> > S&P500
> > > > has
> > > > > lost 25 percent in the same time period. If you compare years
> > 2000/2001
> > > > > against 1929 you'll see that there's a world of a difference in
price
> > > > > deterioration.
> > > > >
> > > > > Also, you're drawing trend lines on a semi-logarithmic scale and I
> > don't
> > > > know
> > > > > if that's an accurate way to arrive at comparisons. For example,
Back
> > in
> > > > 1929
> > > > > the S&P lost 50% in a month after the '29 top and up to 60% only a
few
> > > > months
> > > > > later. The flaw in such comparisons is simple: you can't compare
> > apples to
> > > > > oranges -- all things considered, it's impossible to draw
comparisons.
> > For
> > > > > example, the universe of traders and trading vehicles are totally
> > > > different,
> > > > > commodity prices may be totally different, and the government has
more
> > > > > accurate data to proactively involve themselves at an earlier
stage.
> > On a
> > > > > final note, even though the scale in the gif were semi-logarithmic
> > there
> > > > > wasn't any adjustment in price to account for inflation --- and
that
> > makes
> > > > a
> > > > > world of a difference. And, although I'm into celestial
influences,
> > are
> > > > they
> > > > > the same? Let's ask those who follow this discipline.
> > > > >
> > > > > On a note I'm happy there's so much negativity in RT. Why? I see a
> > nice
> > > > > counter wave here that I think will carry for several weeks. I'm
> > basing
> > > > this
> > > > > on an Elliot pattern and some Fib relationships that may hold. So,
> > with
> > > > all
> > > > > this negativity, it may be a great contrarian investment.
> > > > >
> > > > > Ralph
> > > > >
> > > > >
> > > > >
> > > > > To unsubscribe from this group, send an email to:
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> > > > >
> > > > >
> > > > >
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> > > >
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> > > >
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>
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