Major Nazz composite resistance looks like 3000 from the monthly chart. An uptrend channel is apparent. Short-term, we are near the upper band. Meaning we break to a new level or pullback. I tend to favor a break up. The valuation work I've been doing gives me more confidence that the US markets are massively undervalued, assuming my preferred economic trajectory continues.
The disinflation, moderate growth economic trajectory reminds me of 1985. The following years saw major gains in a melt-up.
Barron's quotes Barry Ritholtz as saying, "The market is now a trading market, increasingly detached from the decaying fundamentals." I disagree.
First, the fundamentals are NOT decaying since earnings are still GROWING nicely. Maybe he doesn't know what "decay" means. A old tree grows more slowly in % terms, but in actual wood growth adds more wood. Decay requires a decline. The US markets are grossly undervalued based on earnings growth & the current level of interest rates. Disinflation & moderate growth has, in the past, created great bull markets.
Second, the market is NOT a trading market. It's a buy & hold market (with moderate leverage) as the undervaluation is slowly realized. I suppose brainless beefers have to buy a group's trend to try to make their fees, and might run some groups too high, too fast. But I think we can make strong gains with simple buy & hold with only moderate trading activity. That worked in 1985-1986, btw.
The public is completely missing this move. In 2000, they learned the wrong lesson, as usual.
Warren Buffet says average "Joe Investor" should buy stock index funds. Uh, like the Krypto Fund strategy :-)
PS: I heard last night on Bloomberg that Warren Buffet's Berkshire Hathaway was considering buying a "big business" that would require financing. My guess is AIG.
PPS: I was wrong about commodity weakness being index funds. The selling was normal beefer commodity funds (coffee, cocoa, hogs, cattle). Index funds added small amounts to positions, except in cotton and wheat.
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17 comments:
i sure as hell missed this and will continue to miss it. i think we both recognize the BLS #'s r (cough) a LIE.
eps growing by stock buybacks (funded by borrowing throught the corp bond market) and a melting US dollar. doesnt seem structually sound to me, but im retarded and leaving the game.
How about dem Jazz. geesh what is boozer taking. just throwing them down in yao's face.
ive got money on the suns to win it all so i was not happy with the first game of that series but i still think the suns take em.
watched bill maher the over morning. so according to the bush adm, violence is down since we increased the # of troops. but knight ridder reports the govt has changed the way it accounts for sectarian violence in iraq. now they exclude suicide and car bombings from the data. its just like the BLS with inflation ( take away the car bombings and suicide bombers and ya the violence is hardly noticeable)
ugh, is bush dead yet? actually we need bush and chenney to get sniped so nancy can take over. what cud she do in 18 months? ;-)
rumor on the view. roseanne bar taking over for rosie.
actually i think roseanne is pretty funny and she loves the GD.
watched bob wier on conan. he whipped out a 35 yr old song named "jack straw" well played, but the edited out the jam. which makes me think why even bookem? thats what they do, they jam.
abby cohen moves to 1600 yr end S&P target. he as been pretty spot on since 2003 :-)
Rockets buy the farm :-((
Mrs. B is now suggesting we watch South Park :-))
Thanks for that good one, Mern.
Sheesh, Boss pays big $ to Clemens. If he put half that into the farm system, maybe he could get some good, young pitching.
Sorry Bunkerman. Our wager on the Rockets came to a crashing end Saturday nite. T-mac did all he could but Yao Ming didn't come through.
Well, at 52 I've lived through two major recessions, two minor recessions, two real estate bubbles, two US stock bubbles & crashes, one Japan stock bubble, and one gold+silver bubble.
Today's economy & market doesn't seem anything like those in any aspect. The housing problem is just one industry in a few prominent markets. The US has been funding a deficit for 25 years. The dollar is back to where it was many years ago.
There are potential problems that "could" arise, but until they develop more, "the trend is your friend" imho.
southpark is more intelligent than most wud think.
may i suggest the south park movie, from 1999. plot is saddamn is dead and in hell. he becomes satans gay boyfriend and starts to mentally abuse the devil. the sound track is awesome, i have the cd. "blame canada" won the oscar for best song i believe
lol
Hmmm. I caculate ORCL is worth about 36 based on 2008 estimates & 15% growth.
Gosh, I gotta buy more of that, too. It's weekly look slike a huge bullish C&H.
Lots of these quality tech stocks seem very undervalued.
South Park movie is on our NetFlix list. I also put Season 1 onto it.
wow 80% cash for alcan. that is a big difference than late 90's.
we r taking out a lot of stock vs flooding the market with it.
the fed is printing a lot of money. guess that is the answer to sub prime, rather than lower rates (which i dont think they can do with $ where it is).
season 1 is the begining. unlike the simpsons which peaked after 4 or 5 yrs, SOuth Park continues to get better.
the weirder the world gets, the more material the have to work with.
i do miss issac hayes. cant believe he quit after they crushed scientology (his religion).
We'll order the other seasons over time.
Lots of Internet problems somewhere. I can't get TCNet to work. And eSignal lost the feed for awhile, too (OK now). Some other sites, too.
tcnet gets slower by the day.
buffett sounds more bullish than in past years
Bought some more GOOG. I'll buy some more in a few days, too. I like to "time-diversify" my buys that I plan to hold awhile.
Zzzzzzzzzzzzzzzzzzzz.
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