when retail money cheers on the market at all time high. is it the sign? =========================================================/ is it a healthy bull market? today's market condition [R8/20/2020] ==================================================/ Looking back to Oct 10, 2000: (two months later, Market tanked A negative tone While the big dollar drops tended to come in April, and the large percentage dips are concentrated in computer-related fields, the trends are not overwhelming. And that makes individual investors nervous. Many of the large percentage drops have come in the last three months. Technology stocks rely heavily on projections of future growth. Those projections were too high at the start of this year, according to Marshall Acuff, equity strategist for Salomon Smith Barney. "All those people who were waxing so bullish early in the year are now finding out the reality, that growth is slowing," Acuff said. When there's a slight adjustment in the growth outlook, it can have a dramatic effect on a stock's current price. As the economy slows and investors fret about profits, it has had a dramatic effect. "When you get disappointments on companies that are selling at 60, 80, 100 times earnings, you get more room to fall," said Al Goldman, chief market strategist at A.G. Edwards. But Goldman conceded there have been swift drops in non-tech stocks, too. "It is not normal to have that type of a drop in a supposedly quality, conservative growth company," Goldman said. The Euro is down. Oil prices are up. Companies are growing wary of making big purchases in computers - particularly in Europe, where American imports are suddenly 20 percent more expensive. There are plenty of motives for bad earnings. Top that with a market in a stiff correction, and investors desert not only sinking companies but also companies that might sink. After one company disappoints, others in its industry get forced down. They are sinking by association. "People are looking at this news as a glass-is-half-empty attitude," Goldman said. "They are jumping to the most negative conclusions." Unprecedented 'piling on' Mutual-fund managers and hedge-fund managers may shoulder some of the blame. They have the huge positions that can cause a stock to tank. "They tend to be like sheep. They are followers," Johnson said. "It's called piling on in football, and I think it's the equivalent. It's unprecedented." Mutual-fund managers may have other motives for selling. Many took profits when the markets peaked this spring. Many end their fiscal years in October, and they can now take losses to cover their gains, unlike prior years. So beaten-down stocks get further beaten down by tax-driven selling. Still, such sudden drops in favorite stocks leave many retail investors shaken. There has been little to gain stepping up to buy a beaten-down stock this year. Johnson thinks many have been backing away from the markets as a result. One positive - and it's a stretch - is that sudden one-day drops are better than the Chinese water torture of seeing a stock slowly shed its value. Maybe expectations are more realistic, too. "They say the markets are driven by fear and greed," said Spiros Segalas, fund manager of the Harbor Capital Appreciation fund, a large-cap growth fund. "We're certainly not in the greed part of the equation anymore." * Disclaimer -- Click here to send e-mail to Alex Frew McMillan