CLASS, TELL ME WHAT HAPPENS WHEN WE HAVE 10 {TEN} ECONOMISTS SAYING THE MARKET IS GOING UP IN 2007 AND NO SLOW DOWN ? BGP
As long as the market keeps lending and willing to take on ever increasing risk everything can go higher, but it will stop at somepoint. The fed will cut, and every rich person in US will move all there wealth into foreign assets as the dollar nosedives.
They are not waiting on Fed, but doing so already. For example, yesterday 2 billion dollars was moved into bonds of ICICI, bank of India. that is more than all the funds transferred in all of 2006 to India and one of the largest bonds ever floated by any bank anywhere. A few weeks ago, same, but more so, happened with Chinese bank, but not via bonds. Perhaps the run on dollar is beginning?
would it be fair to say mutual funds are taking some kind of off-set action? .........what for?..........insider selling doesn't tell you anything other than insiders are selling.......so this requires an interpretation and no, it aint a cue that the markets need go down (immediately or anytime) but, you see, sentiment readings at altime highs and insiders are off-loading holdings at 6 to 1......in the original article I cut-out the rhetoric of emotional bias.......in the least the logic tends to defy logic........ DJTA........yes, that's a better leading indicator than the NDX or SOX imo for there to exist a bull market anomaly sometimes, referred to me as the Dow Theory, the transports need to be showing a dissociative action relative to the Dow .......of course no one has empirically displayed that one must lead the other and such cannot be proven because each index is to itself driven.......regardless of that there are the same personality traits of all indexes........the same fractals.......look closely att the most recent altime high and it did appear at a major high in the dax, spx and dow........based in the current 3-step down since that high, the transports appear to still be in a healthy bull phase......appears to me to have completed a simple zigzag retrace.........keep in mind that the transports (even if dollar adjusted) have taken a very good hit from fuel overheads and still keeps barreling upwards........a move below 4120 on lifting volumes in sales would be a bearish omen........ in the last 6 years there have been strong bouts of insider selling.......a 6 to 1 ratio is no miniscule matter......these are the people in the know.........what do they know that we don't ? You asked for a simple correlative logic of insider-sells equals a falling index.......no.......I am offering an awareness of something that shouldn't be ignored......these types of actions are never time effective......the follow-on effect maybe several months or even years.......but you don't want to miss the jigsaw pieces.......if the indexes were to fall everytime there were a significant sell-to-buy ratio then we would have a pretty easy picking........this merely, if nothing else, continues to show that the fundamental arguments don't match upto the immediacy of price influence but least you've got some kind of bias to work with, something tangible............. so the transports are now taking a back-seat in the upward race relative to the dow.......so long as the transports keeps pedaling to get to another altime high in the next 6 to 12 months I'll be satisfied that I'm not trading long on borrowed time....that the bias continues to be with smart money, ambitions, to be long.......however, if the transports cannot make a new altime and performs like it did in 1970-74 period then it'll confirm to me that the current move in the dow is a very big (long) hoax.......when the dow made a new altime hoax high in the 1972 the trannies did not confirm that high which led to the 74 dump and a very tough social period.........this is all about looking for bias J
First of all, that ratio of 63.18 along w/ that $8.4B is nothing. Just Merill Lynch holds a few Trillion dollar worth of stock, what's $8.4B in a market? Second, if I own MSFT or KSS, I would dump it too. KSS is way too over price, not to mention it's P/E is way too high. Dept. store sales, if you read the past 2 yr. Adv. Retail Sales Report by the govt., it actually shows Dept. store sales are dropping on a year over year basis, instead of gaining. Retail sales overall is gaining, but zero in on Dept. stores, some even say in the next 10 yr. a lot of merger will desolve a big portion of these dept. store. Overall, their average profit margin is only less than 5%. Kss has gained its share because they sold their credit card business, got a few billion back, and engage in a stock buy back, its stock current value doesn't justify their earning. MSFT--come on, they haven't move in 6 yr., back 2 mth. ago, some airhead was interviewed by Maria Bartriromo at CNBC, that fund manager were ask what to buy, and he said MSFT. Guess what Maria said? MSFT hasn't move in years. But that airhead said w/ Vista, it's turbo charge MSFT. But that's not possible, especially w/ today's Intel earning shows a drop of 39 pt. on earning, noone is buying new PC. For an average business, who uses WordPerfect suite or MS Office, Intenet browser, name a Pentium 3 that can't run the above. For that matter, name a Pentium II that can't run the above. AFter the Y2K upgrade, computer industry is flat. The ones buying new computers are the ones who didn't have a computer, not someone who has already own a P3. I had a P4-1.3GHZ, someone took it off my hand on Christmas 2005, got a P4-2.8GHz, zero change in performance. So if I own MSFT, I would have dump it years ago. Goog--it's P/E is too high, the stock has no direction, it's goes up and down all over the place, neither Greenspan or the google guys can tell the direction of the stock tomorrow. Anyone who owns, sell it for profit. So in the end, I don't disagree w/ that article. But having said the above, Citi bank is forecast Dow hit 14K this year. As of today, Dow hit the 3rd record high again. If there is a slow down or recession during the 2008 baby boom due to early retirement, I'll buy that. IF the full force of baby boom effect kicks in at 2011, I'll buy that. But a recession this year, I can't see. A slow down in Q1 and Q2 w/ a boost in Q3 and Q4 is much more likely and consistent w/ Fed. official forecast.