Use sufi, policy, education, technology, communications, GlobalVillage School
A traditional book has covers, a table of
contents, chapters so is linear and fixed in time and space. An electric
book has search engines
use "wiredbrain" which is not limited in content therefore is non-linear
and not fixed in time or space.
Click image for
site
Information
The
Money Machine
Make PORTALS
your home page and use "wiredbrain" password "synergy" for set-up start
pages.
MSN now does the best search
Use the Codes to Wiredbrain
Social
ergonomics
Market
Page
Current posts
Continued on - please let me know about errors ! Some of these pages date back up to 10 years ( 1992 ) and have been through many editors and transfers. News about what's happening and for updates use GlobalVillage Excite NewsSearch -
pflaumpflaumpflaumpflaump@cfl.rr.comiredbrain.net/
Continued on - please let me know about errors ! Some of these pages date back up to 10 years ( 1992 ) and have been through many editors and transfers. News about what's happening and for updates use GlobalVillage Excite NewsSearch -
pflaupflaupflaupflaump@cfl.rr.comw.wiredbrain.net/
post.htm
political initiative
social political issues.htm
The go get them firms
The next post PC technologies
The next great technologies
salestax
educational reform
communications technology
The next companies & technologies
http://www.wiredbrain.net/NEXUM.htm
http://www.wiredbrain.net/nano.htm
High Speed Internet by Soliton
disintermedation Last updated on March 20,
1999
Global Markets; Market !
use wiredbrain and "any topic"GlobalVillage
Excite NewsSearch
Since 3/15/1995 ( about 100 per day - 50 % of actual count )
FastCounter
by LinkExchange
paper money pages
- The
Best short term timer & Financial
Weather
Report
-
The
NEWS
before
it
happens
Finance Physics:
Of course, market prices are the result of foggy feeling, mass psychology called perceptions. BUT, over the longer run, basic economic principles and the laws of social physics will "correct" the difference between false perceptions and a harder reality.
In the
current context the following will happen - the only question is when:
1.)
The misbalance between American growth and ECU’s struggles, Japan’s and Asia’s problems put pressure on the dollar because of the trade gap:
2.) Raw declines in the dollar forces increases in the interest rates dollar securities have to pay;
3.)
The higher cost of capital slows U.S. growth rates and forces a market "correction" of the irrational exuberance of speculative stocks.
We're moving toward a world of 1 billion connected computers
sometime in the next decade," Grove said, saying it would represent
some 20 percent of the world's population and a great opportunity"
for the Pacific Rim.
The theme of "wiredbrain" is that the "new world orders" are global connections between utility network computers.
Like the human brain, the
internet's packets system
can reconfigure itself to work even after portions were destroyed. Using the noise-prone analog circuits of the time, it was impossible to
build the necessary switches. Baran concluded that all the traffic would
have to be digital. Moreover, the digital traffic would have to be broken
into short message blocks now called "packets," each containing its own
routing information,
like a DNA molecule, and
able to replicate itself correctly whenever a transmission error occurred.
With many additions and permutations, his original design is today termed
the Internet,
Click here for the emerging history
of
the 21st century.
Britain's Keele University, and from Cavendish Management Resources (CMR), of a "3-D Memory System" that promises 3.4 terabytes in a device the size of a credit card it costing about $48!!
Fast transportable records means a whole new world of record keeping and economic transactions. Indeed the time has come for
Global Money as well as communications.
The concept of a virtual organization - of a transitory network of individuals coupled together by advanced communications technologies - continues to grow in prominence. However, a lack of detailed, real-world cases poses a significant problem when attempting to analyze the business potential of linking remote workers in patterns of
virtual organization. Such a lack of examples
is particularly acute within the small business sector. A case study of a UK-based SME - Cavendish Management Resources - is presented. Both practical and theoretical insights into new flexible
patterns of organization in the small business sector are presented.
FROM
http://www.digital.com/rcfoc/
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
|
|
Use sufi, policy, education, technology, communications, GlobalVillage School
A traditional book has covers, a table of
contents, chapters so is linear and fixed in time and space. An electric
book has search engines
use "wiredbrain" which is not limited in content therefore is non-linear
and not fixed in time or space.
Use sufi, policy, education, technology, communications, GlobalVillage School
A traditional book has covers, a table of
contents, chapters so is linear and fixed in time and space. An electric
book has search engines
use "wiredbrain" which is not limited in content therefore is non-linear
and not fixed in time or space.
Use sufi, policy, education, technology, communications, GlobalVillage School
A traditional book has covers, a table of
contents, chapters so is linear and fixed in time and space. An electric
book has search engines
use "wiredbrain" which is not limited in content therefore is non-linear
and not fixed in time or space.
A traditional book has covers, a table of
contents, chapters so is linear and fixed in time and space. An electric
book has search engines
use "wiredbrain" which is not limited in content therefore is non-linear
and not fixed in time or space.
Click image for
site
Information
site Information
The
Money Machine
The
Money Machine
Make PORTALS
your home page and use "wiredbrain" password "synergy" for set-up start
pages.
MSN now does the best search
Use the Codes to Wiredbrain
Social
ergonomics
Market
Page
Current posts
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post.htm
political initiative
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High Speed Internet by Soliton
disintermedation Last updated on March 20,
1999
Global Markets; Market !
use wiredbrain and "any topic"GlobalVillage
Excite NewsSearch
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FastCounter
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- The
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Weather
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The
NEWS
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Finance Physics:
Of course, market prices are the result of foggy feeling, mass psychology called perceptions. BUT, over the longer run, basic economic principles and the laws of social physics will "correct" the difference between false perceptions and a harder reality.
In the
current context the following will happen - the only question is when:
1.)
The misbalance between American growth and ECU’s struggles, Japan’s and Asia’s problems put pressure on the dollar because of the trade gap:
2.) Raw declines in the dollar forces increases in the interest rates dollar securities have to pay;
3.)
The higher cost of capital slows U.S. growth rates and forces a market "correction" of the irrational exuberance of speculative stocks.
We're moving toward a world of 1 billion connected computers
sometime in the next decade," Grove said, saying it would represent
some 20 percent of the world's population and a great opportunity"
for the Pacific Rim.
The theme of "wiredbrain" is that the "new world orders" are global connections between utility network computers.
Social
ergonomics
Market
Page
Current posts
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Market
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High Speed Internet by Soliton
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post.htm
political initiative
social political issues.htm
The go get them firms
The next post PC technologies
The next great technologies
salestax
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The next companies & technologies
http://www.wiredbrain.net/NEXUM.htm
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High Speed Internet by Soliton
Continued on - please let me know about errors ! Some of these pages date back up to 10 years ( 1992 ) and have been through many editors and transfers. News about what's happening and for updates use GlobalVillage Excite NewsSearch -
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post.htm
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The next post PC technologies
The next great technologies
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educational reform
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The next companies & technologies
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High Speed Internet by Soliton
pflaupflaupflaupflaump@cfl.rr.comw.wiredbrain.net/
post.htm
political initiative
social political issues.htm
The go get them firms
The next post PC technologies
The next great technologies
salestax
educational reform
communications technology
The next companies & technologies
http://www.wiredbrain.net/NEXUM.htm
http://www.wiredbrain.net/nano.htm
High Speed Internet by Soliton
social political issues.htm
The go get them firms
The next post PC technologies
The next great technologies
salestax
educational reform
communications technology
The next companies & technologies
http://www.wiredbrain.net/NEXUM.htm
http://www.wiredbrain.net/nano.htm
High Speed Internet by Soliton
The go get them firms
The next post PC technologies
The next great technologies
salestax
educational reform
communications technology
The next companies & technologies
http://www.wiredbrain.net/NEXUM.htm
http://www.wiredbrain.net/nano.htm
High Speed Internet by Soliton
The next great technologies
salestax
educational reform
communications technology
The next companies & technologies
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http://www.wiredbrain.net/nano.htm
High Speed Internet by Soliton
The next companies & technologies
http://www.wiredbrain.net/NEXUM.htm
http://www.wiredbrain.net/nano.htm
High Speed Internet by Soliton
The next companies & technologies
http://www.wiredbrain.net/NEXUM.htm
http://www.wiredbrain.net/nano.htm
High Speed Internet by Soliton
High Speed Internet by Soliton
disintermedation Last updated on March 20,
1999
Global Markets; Market !
use wiredbrain and "any topic"GlobalVillage
Excite NewsSearch
Since 3/15/1995 ( about 100 per day - 50 % of actual count )
FastCounter
by LinkExchange
paper money pages
- The
Best short term timer & Financial
Weather
Report
-
The
NEWS
before
it
happens
use wiredbrain and "any topic"GlobalVillage
Excite NewsSearch
Since 3/15/1995 ( about 100 per day - 50 % of actual count )
FastCounter
by LinkExchange
paper money pages
- The
Best short term timer & Financial
Weather
Report
-
The
NEWS
before
it
happens
FastCounter by LinkExchange
- The Best short term timer & Financial Weather Report -
The
NEWS
before
it
happens
Finance Physics:
Of course, market prices are the result of foggy feeling, mass psychology called perceptions. BUT, over the longer run, basic economic principles and the laws of social physics will "correct" the difference between false perceptions and a harder reality.
In the
current context the following will happen - the only question is when:
1.)
The misbalance between American growth and ECU’s struggles, Japan’s and Asia’s problems put pressure on the dollar because of the trade gap:
2.) Raw declines in the dollar forces increases in the interest rates dollar securities have to pay;
3.)
The higher cost of capital slows U.S. growth rates and forces a market "correction" of the irrational exuberance of speculative stocks.
We're moving toward a world of 1 billion connected computers
sometime in the next decade," Grove said, saying it would represent
some 20 percent of the world's population and a great opportunity"
for the Pacific Rim.
The theme of "wiredbrain" is that the "new world orders" are global connections between utility network computers.
Of course, market prices are the result of foggy feeling, mass psychology called perceptions. BUT, over the longer run, basic economic principles and the laws of social physics will "correct" the difference between false perceptions and a harder reality.
In the
current context the following will happen - the only question is when:
1.)
The misbalance between American growth and ECU’s struggles, Japan’s and Asia’s problems put pressure on the dollar because of the trade gap:
2.) Raw declines in the dollar forces increases in the interest rates dollar securities have to pay;
3.)
The higher cost of capital slows U.S. growth rates and forces a market "correction" of the irrational exuberance of speculative stocks.
We're moving toward a world of 1 billion connected computers
sometime in the next decade," Grove said, saying it would represent
some 20 percent of the world's population and a great opportunity"
for the Pacific Rim.
The theme of "wiredbrain" is that the "new world orders" are global connections between utility network computers.
current context the following will happen - the only question is when:
1.)
The misbalance between American growth and ECU’s struggles, Japan’s and Asia’s problems put pressure on the dollar because of the trade gap:
2.) Raw declines in the dollar forces increases in the interest rates dollar securities have to pay;
3.)
The higher cost of capital slows U.S. growth rates and forces a market "correction" of the irrational exuberance of speculative stocks.
We're moving toward a world of 1 billion connected computers
sometime in the next decade," Grove said, saying it would represent
some 20 percent of the world's population and a great opportunity"
for the Pacific Rim.
The theme of "wiredbrain" is that the "new world orders" are global connections between utility network computers.
The misbalance between American growth and ECU’s struggles, Japan’s and Asia’s problems put pressure on the dollar because of the trade gap:
2.) Raw declines in the dollar forces increases in the interest rates dollar securities have to pay;
3.)
The higher cost of capital slows U.S. growth rates and forces a market "correction" of the irrational exuberance of speculative stocks.
We're moving toward a world of 1 billion connected computers
sometime in the next decade," Grove said, saying it would represent
some 20 percent of the world's population and a great opportunity"
for the Pacific Rim.
The theme of "wiredbrain" is that the "new world orders" are global connections between utility network computers.
3.)
The higher cost of capital slows U.S. growth rates and forces a market "correction" of the irrational exuberance of speculative stocks.
We're moving toward a world of 1 billion connected computers
sometime in the next decade," Grove said, saying it would represent
some 20 percent of the world's population and a great opportunity"
for the Pacific Rim.
The theme of "wiredbrain" is that the "new world orders" are global connections between utility network computers.
We're moving toward a world of 1 billion connected computers
sometime in the next decade," Grove said, saying it would represent
some 20 percent of the world's population and a great opportunity"
for the Pacific Rim.
The theme of "wiredbrain" is that the "new world orders" are global connections between utility network computers.
Like the human brain, the
internet's packets system
can reconfigure itself to work even after portions were destroyed. Using the noise-prone analog circuits of the time, it was impossible to
build the necessary switches. Baran concluded that all the traffic would
have to be digital. Moreover, the digital traffic would have to be broken
into short message blocks now called "packets," each containing its own
routing information,
like a DNA molecule, and
able to replicate itself correctly whenever a transmission error occurred.
With many additions and permutations, his original design is today termed
the Internet,
Click here for the emerging history
of
the 21st century.
"packets," each containing its own
routing information,
like a DNA molecule, and
able to replicate itself correctly whenever a transmission error occurred.
With many additions and permutations, his original design is today termed
the Internet,
Click here for the emerging history
of
the 21st century.
of the 21st century.
Britain's Keele University, and from Cavendish Management Resources (CMR), of a "3-D Memory System" that promises 3.4 terabytes in a device the size of a credit card it costing about $48!!
Fast transportable records means a whole new world of record keeping and economic transactions. Indeed the time has come for
Global Money as well as communications.
The concept of a virtual organization - of a transitory network of individuals coupled together by advanced communications technologies - continues to grow in prominence. However, a lack of detailed, real-world cases poses a significant problem when attempting to analyze the business potential of linking remote workers in patterns of
virtual organization. Such a lack of examples
is particularly acute within the small business sector. A case study of a UK-based SME - Cavendish Management Resources - is presented. Both practical and theoretical insights into new flexible
patterns of organization in the small business sector are presented.
FROM
http://www.digital.com/rcfoc/
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
Fast transportable records means a whole new world of record keeping and economic transactions. Indeed the time has come for
Global Money as well as communications.
The concept of a virtual organization - of a transitory network of individuals coupled together by advanced communications technologies - continues to grow in prominence. However, a lack of detailed, real-world cases poses a significant problem when attempting to analyze the business potential of linking remote workers in patterns of
virtual organization. Such a lack of examples
is particularly acute within the small business sector. A case study of a UK-based SME - Cavendish Management Resources - is presented. Both practical and theoretical insights into new flexible
patterns of organization in the small business sector are presented.
FROM
http://www.digital.com/rcfoc/
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
Global Money as well as communications.
The concept of a virtual organization - of a transitory network of individuals coupled together by advanced communications technologies - continues to grow in prominence. However, a lack of detailed, real-world cases poses a significant problem when attempting to analyze the business potential of linking remote workers in patterns of
virtual organization. Such a lack of examples
is particularly acute within the small business sector. A case study of a UK-based SME - Cavendish Management Resources - is presented. Both practical and theoretical insights into new flexible
patterns of organization in the small business sector are presented.
FROM
http://www.digital.com/rcfoc/
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
The concept of a virtual organization - of a transitory network of individuals coupled together by advanced communications technologies - continues to grow in prominence. However, a lack of detailed, real-world cases poses a significant problem when attempting to analyze the business potential of linking remote workers in patterns of
virtual organization. Such a lack of examples
is particularly acute within the small business sector. A case study of a UK-based SME - Cavendish Management Resources - is presented. Both practical and theoretical insights into new flexible
patterns of organization in the small business sector are presented.
FROM
http://www.digital.com/rcfoc/
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
virtual organization. Such a lack of examples
is particularly acute within the small business sector. A case study of a UK-based SME - Cavendish Management Resources - is presented. Both practical and theoretical insights into new flexible
patterns of organization in the small business sector are presented.
FROM
http://www.digital.com/rcfoc/
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
http://www.digital.com/rcfoc/
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
FOR reporters: Please site "wiredbrain" reports that
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
the
market:
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
Tuesday July 7th
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
Dow
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
@
DOWN,
=
NSDQ100
*-8.5
based on general market conditions RANGE
=
NSDQ100
*-8.5
NSDQ100
*-8.5
*-8.5
*-8.5
based on general market conditions RANGE
Something missing:
An astro-physicist has said ‘ there is no reason that people should be ever be able to
understand the universe’. Our biological and intellectual background is so naturally limited by our life experience here on Earth. We have no way of comprehending or visioning space time plasma that behaves in ways impossibly strange to our ways of being and knowing. Atomic physics involves models that are not intuitive - even counter- intuitive.
Most people who have ever lived on this planet, were born and died within a fifty mile range.
Their perceptions are defined within what is called a tribal culture - part real and part superstition. Applied rational knowledge is fairly modern as a cultural style and still not seriously or firmly established as a norm.
The irrational base of human understanding is clearly demonstrated by politics and commercials.
NOW as we enter into a global technical society our social world is as little understood as the physical.
The new world order - lacks a vision or social psychological foundation.
]
The technology itself is revolutionary.
The global economy requires new models of thought. It’s not surprising that it is difficult and there is a lot of active and passive resistance.
The leaders and leading institutions often don’t get it. Non-linear, transactional, mutually dependent rapid change appears to many as anarchy and chaos - morally questionable and in conflict with traditional values. That is because global transformations are a real revolution. Serious changes are disruptive of the existing order.
The History of the Future:
London 6,200 - record highs Paris
4400* high, Frankfort 6,150 * high
------------------------------------------------------------
MARKET
PRICES AT 1348 GMT Oct 5 (Reuters)
MARK 1.6374/64 YEN
134.47/57 STERLING 1.6893/03
GOLD $298.50/299.00 -2.00 (pvs PM fix) BRENT
$14.16 -0.20
FTSE 4720 -30.40 CAC 3,003.82 -35.32 X-DAX
4030.36 +11.05
------------------------------------------------------------
FROM
------------------------------------------------------------
MARKET PRICES AT 1100 GMT
MARK 1.7864/79 YEN 140.72/82 STERLING 1.6411/22
GOLD $294.50/295.00 -0.10 ?????vs PM fix) BRENT $12.60 -0.30
FTSE 6065.4 -67.30 CAC 4,280.73 -41.35 X-DAX 6127.97 -56.13
---------------------------------------------------------------
S&P
500 future Closed at S&P 500 SEP98 1073.00
-4460
S&P 500 DEC98 954.20B
-2480
Current
E-MINI
.
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
S&P 500 DEC98 954.20B -2480
EURO $ DEC98 95.1100A +9
E-MINI DEC98 955.00
-2400
MAR99 95.5450 +9.5
MAR99
963.50A -2400
JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
E-MINI DEC98 955.00 -2400 MAR99 95.5450 +9.5
MAR99 963.50A -2400 JUN99 95.6700 +10
NSDQ100 DEC98 1131.50A -3200
cash
less
price
less
price
of premium
= CASH
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
[-15 premium ]= 950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
950
=
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
Cash
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Tested
the limits:
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
The theory works that the market
will follow the tech stocks -
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
World Markets DOWN mixed, Europe
DOWN from high, dollar down,
Eye on the
YEN
@ 145 to 117
, DMark up from 1.78 to 1.61 ECU .89 to
.817
Flight to Quality: Long Bond at 4.85 % from 5.6 %
Eye on the
YEN
@ 145 to 117
Flight to Quality: Long Bond at 4.85 % from 5.6 %
dollar DOWN
Technology started down in up market
T
he Market Posture was downgraded to Mildly
Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early June 1998.
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
Wiredbrain's Index Summary,
=
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
Summary, =
*-8.5
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
Technologies
Went DOWN in UP market -3.5, -1.0 interest DOWN on flight to quality (
short term bills), -1.0 dollar UP except YEN, -2.5 Asia markets mixed down
- Europe MIXED down near the tops, -.5
To see what we said this morning and last night, see
To see what we said this morning and last night, see
Resistance at Dow 9,200 and SP500 1250 - NASDAQ 2000
- NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
NDX at 1400
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
WIREDBRAIN'S
PORTFOLIO Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
Wiredbrain profits on 400.000 - from
+ 210 or 62% to 110 +35 %
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
----------
G
o to Wiredbrain's
Bubble page
Everyone
can be right ( and wrong) :
We
have made the case for a long time about new technology and economic growth.
For several years we have pointed out that the "material" factory based
economic model was being replaced by a cyber-tech IT ( information technology
). See last years
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
from 210 HIGH going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
going
down, (H-L) = change / {(H+L)/2} = average of high and low
50% to 65 % gains in less than 4 months ( up from 25 % in Jan )
Wiredbrain's Yahoo at wiredbrain password
"synergy"
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
Support at Dow 7500, - 5 %, 950 on the SP500, NASDAQ at
1450
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
European Markets go up while the
US goes down
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
Buy Asia bonds, European Stocks
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
( sell: go short US market )
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
WIREDBRAIN'S
PORTFOLIO
Wiredbrain at 110
- 32% from 210
going down, (H-L)
= change / {(H+L)/2} = average of high and low
WIREDBRAIN'S PORTFOLIO
This index is very sensitive
to future direction of market
Wiredbrain's
Yahoo at wiredbrain password "synergy"
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
wiredbrain password synergy top 5 % in final bell game
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500
1135 - NASDAQ 1900
- NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
Money.com's
Real Time Quotes
provides each registered user
with access to 50 real-time quotes per day for securities traded on the
NYSE, AMEX, NASDAQ exchanges. FREE
To see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Resistance at Dow 9,200 and SP500 1135 - NASDAQ 1900
-NDX at 1285
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
Support at Dow 7500, - 9.5 %,
950 on the SP500, NASDAQ at 1450
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
EURO $ JUN98 94.265 = 5.735 %
EURO $ DEC98 95.1100A
+9
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
LIBOR JUN98 94.32 = 5.68 %
T-BILL JUN98 94.925 = 5.075 %
30 Year bond from 6.09 to 4.7
%
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
IXCO
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
SOX MSH PSE NDX
down in an up market
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
the
short term is into over sold
conditions
MARKETS
Primative fallacy:
Primative fallacy:
post
hoc, ergo propter hoc-
after therefore because
seems to be very pop ular - for the financial reporter.
Ghosts
Living
with ghosts;
There
are white ghosts, gray ghosts, black ghosts. While ghosts try to protect
you, they are as angels. Gray ghosts are more as people are, they have
moods - sometimes loving sometimes spiteful and emotionally unstable. Black
ghosts hide in dark places and are wicked . Ghost are also known as spirits,
apparitions, phantoms and spooks.
They
are the product of the pre-conscious mind mixed with social convention,
memories and body knowledge or intuitiveness.
They exist as Santa, as elves,
gnomes, as ferries.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
They attach themselves to physical locations around
memories of times lost.
They exist is the same way all our feeling, thoughts,
and theories exist in the "Dream Time", the order of reality that gives
meaning, traditions, religions, faith, practices upon human tribal customs
are built into social laws.
Sure
we believe in ghosts. Politics and other product commercials are built
on common ghosts - fears and hope outside the mundane "rational" day to
day logic. Markets are built on spirits of faith, hope and fear.
The ancient
woods, rocks, lakes and clouds were inhabited by spirits.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
These creatures
have not completely departed with the advent of scientific thought but
have moved into the core of economic and political activity.
LINKS
all the major connections
LINKS
all the major connections
As
long as the future stays 3 to 5 pts. below the market
,
people buy the future and sell the stocks - this is the way the market
moves rather than individual stock sales. ``If hedge funds start to see
signs of S&Ps losing momentum or an interruption of a trend, they are
going to take profits,''
The
model we have been using was based on the technology stocks leading the
market as they are again. When the prices of "regular" stocks get over
P/E's of 25 then there is a push and pull as people look for new buys.
This pushes up technologies which then follow the market. For the last
few weeks the MAJORS- the fad of the day - big caps are leading the market
-up and down.
The
second part of the model is the "global" effects as money moves around
the world looking for safe haven and higher returns. This still works but
seems nothing gets the attention of a "bullmarket" in full charge. Now
that the bull is tired people will begin the pay attention to what is going
on in the bond, currencies, and global market place. Deflation ! Maybe
Gold and Swiss Franks - as people move out of over priced US assets compared
to better buys elsewhere - there is movement into companies that will benefit
from EMU - Europe's growth stocks, British bonds, high interest bonds in
Asia, Latin America communications, China... even short term cash and notes
----------
The NOISE -
The NOISE -
guessing
what will be perceived as important ?
At
one point it's earning
At
one point it's foreign markets
At
one point it's interest rates - the fed
At
one point it's technology
At
one point it's take overs
At
one point it's fundamentals ( growth and inflation )
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
``
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
``If
U.S. stocks are weak later tonight, there is a good chance that the Hang
Seng Index will gap down at the opening on Wednesday,'' Yung said.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
Technical
analysts see trouble in the 200-day moving average
By
Greg Miles
CNBC
May
4 —
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
professional
and private investors perform fundamental research on actively traded companies
and
mutual
funds and locate important economic data that moves markets.
http://www.moneysearch.com/docs/quant.html
When
is enough, enough ?
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
The
Nasdaq composite index and Standard & Poor's composite index were unable
to hold gains overnight and brokers felt there was a good chance the Dow
industrials would fall on Tuesday.
The
U.S. long-bond yield rose above 6.00 percent last night and there is a
concern that U.S. PPI might reverse the recent negative growth trend to
positive,'' Yung said.
The
United States is due to announce its April Producer Price Indexes on Wednesday
and economists polled by Reuters, on average, expected prices to rise 0.1
percent overall.
Editoral:
FUNDAMENTALS:
Are
stocks ready to hit a
bubble?
CNBC
The stock market has risen by more than 2,500 points since last October,
a huge gain that has many experts arguing that stocks are overpriced. Now
Birinyi Associates and Barron’s, the business and financial weekly, have
weighed in with new statistics and analysis supporting that argument.
WSRN
- Wall Street Research Net Wall Street Research Net consists of over
110,000 links to help
http://www.moneysearch.com/docs/quant.html
P/E
is 21+ not 18
The
tradition is of froth - a speculative frenzy based on past returns.
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
The
theory is of a greater fool who will buy at inflated prices.
The bulls
are depending on a upward demand curve where money is desperate to find
a place to go. Less favored stocks would then benefit from "bargain hunting".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
The signs of tops and froth are stories in the popular press and on the
evening news, big swings on rumors and hype and hope, stock tips from friends
and "insiders".
We
now have a 10 trillion dollar market with 2/3 of the action is in mutual
funds. This funds have billions to invest and this represents a critical,
but still small, margin of buyers to sellers. Japan, other Asian investors
are looking for safe haven. International funds have increased the US share
of their holding. When is enough, enough ?
Two
tillion dollars has been created in "paper" value. Based on "real" returns
over the next five years this is 26/22 or 118 % of any "realistic" values.
European organizations that will benefit from consolidations as the biggest
world economy, the common market becomes more integrated.
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
These are some
what a better buy. If Asia turns around there are good buys there and if
it doesn’t everyone is over priced.
The real decline of economic power
in Asia is just setting in as business close and workers are laid off.
So far it's a currency and financial problem but quickly becomes a business
crisis. Downward cycles are not quickly turned around. Mexico, which made
a remarkable recovery, took three years.
The
reasonable expectation is a slow recovery of high growth taking up to five
years. American growth rates will decline 50 % from over 4 % to about 2.5
% or lower.
The big blue chip international companies are most exposed,
the smaller, faster, high tech have more room for adjustments.
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
The engines
of growth are world trade and new technology in global communication networks
that improve productivity.
The PC has been the fastest applied new technology,
trains took a century, cars and planes took 30 years, radio and TV 25 years,
but PC are only really 15 years old. BANDWIDTH - bandwidth - bandwidth
There
is a need to
check
for last minute changes
check for last minute changes
CME
To
see what we said this morning and last night, see
http://www.wiredbrain.net/short.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
Alternative
site http://www.geocities.com/Yosemite/Trails/4333/flash.htm
News
and analysis GO TO
Money pages first
forecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
News and analysis GO TO
Money pages firstforecast.htm,
then
conditions.htm
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
Main page Flash.htm
----------
G
o to Wiredbrain's
PAGE TWO
PAGE TWO
Bubble page
Everyone
can be right ( and wrong) :
today,
packets.htm
The
second wave model was based on production, from farm and mines, to factories
- material produce that was stored in inventory, sold to wholesalers and
ended up in shops.
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The third wave model, products are less important than
services. Systems of ideas match client demands within networks of OEM
( original equipment manufactures ) and direct sales to users.
The open
market in electric power with commodity prices distributed directly to
end users down networks uses an Asymmetric out of equilibrium algorithm
rather than seeking a mythological equilibrium at some sort of steady state.
Networks of material and service providers on a global scale certainly
changes forecasts of economic futures. (
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The use of networks to find practical
paths has to do with the "traveling salesman problem". If the sales person
has to visit a large number of points there is no single shortest path
and the "best" solution is often counter-intuitive. )
The
irrational increase in stock prices is now being justified by blithe forecasts
of endless growth. People want to forget that economic change has loosers
that out number winners in the short run; the iceman, the candle makers
are gone.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The internet replaces many middle people, from bankers and travel
agents, to wholesalers and distributors.
The "endless growth" craze now
is being used politically to avoid hard or unpopular changes in entitlement
benefits.
The
bulls and the bears are both right and both wrong.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The business cycle has
not been repealed but changes from a material one to one of the mind and
spirit, SYNERGY where the whole is more than the sum of the parts.
The
factory is replaced by the production of trust and faith in paper, computer
digits, balances and transfers of insubstantial assets.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The over supply
is of faith - belief in a "blue sky" future that produces an over abundance
of paper money, credit, market booms and financial high flightiness.
The
devaluation started in South East Asia last June, spread to Korea and now
Japan, the unwinding of building booms, market booms, inflated prices,
currencies and hopes. So while the real economy does have a bright future,
the paper empires built on hope will tumble- someday.
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
The total equity
market is over 35 Trillion with 1/3 in the US, 20 % in Europe, 15 % in
Japan - and the other 1/3 spread around the world.
The Americans are adding
about 1 billion a day in new investments - or .003 % of the world market
or .01 % ( 2.5 % a year) of the American Market of 10 Trillion. Not enough
to substain a long term boom.
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
The Global equity was about 35 trillion,
last year, before the devaluations.
The US market has grown 20 % from 8
trillion to 10 trillion.
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
The US has gained 2 trillion, Europe a trillion
in paper profits while the rest of the world has loss 3 Trillion -
Global players have increased
the USA % of their investments as they retreat from declining markets.
Now the move is into Europe, back to parts of Asia, Eastern Europe, Latin
America where more double digit returns are possible. We will be surprised
if the Year-to-Year return from April 1 to March 30th will be 5 % for the
US Market - a rate that suggest short term bonds - with currency risks
- or ECU inflation protected utility bonds at 1.5 % more, with a currency
gain for $'s.
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
The
best buy is a basket of Asia's 30 % bonds - the currencies have hit bottom
and the rates have hit their tops. Triple gains, increase in bond prices
as rates decline, increases in exchange values, and real high interest
- and risk !
OUR
RECORD: check
money.htm,
stock.htm
for past calls, been damn good
money.htm,
stock.htm
for past calls, been damn good
Alliance
Global , Bear Stearns Emerg Mkts Debt A Ticker: EMDFX , Countrywide, Dreyfus
Global Bond Ticker: DGBDX, Federated Intl High Income, Franklin Templeton
High Inc Curr Ticker: ICHIX - Gt Global High-Income A Ticker: GHIAX Kemper
Global, Morgan Stanley Worldwide High-Inc A Ticker: : MSWAX - Oppenheimer
Intl Bond C Ticker: OIBCX - Phoenix Emerging Markets Bond B Ticker: : PEMBX
Prudential Interm Global Inc B Ticker: PBIBX T. Rowe Price, Van Kampen,
Vontobel
Wiredbrain's
Yahoo at wiredbrain password "synergy"
SYNERGY
Group's Excite Channel
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
Technologies
2X market
IXCO
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
SOX MSH PSE NDX
down more than market
Pause
in
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Asia's DOWN and Europe's down
from record high ( US Germany France London )
Why
does one index so different from the other ? Could it be the effects of
INDEX trading?
Stocks,
dollar active ( down again) and bonds drifting down;
Asia
down, Europe down from new highs:
bonds
at
4.7 %
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
bonds
UP interest DOWN near lows of 4.65 and off high of 6.2 on money supply,
oil prices near $16 Gold at $310
Currencies
(dollar)
DOWN from rally in a
tight range in a
Negative FX market - (on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
(on
scale from -15 to +15).
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
We, at the height, are ready to decline.
There is a tide in the affairs of men,
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat;
And we must take the current when it serves,
Or
lose our ventures.
Market Letter
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
The
mind of the market:
There
are levels in complex affairs, including the human individual and collectives
psychology, which are more like a marble cake than a layer cake. In traditional
Western thought there are three levels, the surfaces or appearances. Second,
the general categories that we force upon experiences and observations,
and third, some kinds of concepts that are more fundamental - called essences
or general theories. In traditional Eastern thinking there are seven levels
explained on my
color pages.
These
levels have physical analogs.
The body-brain works with a short term memory
bank that takes in impressions and performs current tasks, a long term
memory that contains all our past knowledge and learning, which forms the
context of day-to-day beliefs and actions- and what I call body knowledge
or mood, or the dreamtime, or libido or subconscious which is not apparent
but never the less very powerful.
The market works in the same way.
There are short term
impressions which sometimes get a lot of attention- the "news" of the day,
hour or minute. It can be anything - interest rates, foreign markets, earning,
economic reports, or the wizard of OZ, the Federal Reserve System. How
these events are interpreted depends on the "mood" set by current theory
or ideology.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The underlining market moves within the "noise" of flux and
flows of these moods and impressions.
The physical analog are short term
traders working index futures, bond and stock funds using hedge strategies,
and big institutional investors with their allocation models. Each part
of the system has different time frames and market impacts.
The current market attention is on earning and inflation
from a overheated economy.
The current mood is moving from wild excitement
to caution and on the way to worry.
The same event will seem different
depending on our mood. Little events, petty annoyances, will either cause
an outburst or be ignored depending on how we feel that day. Now the market
is moving toward where news will be felt to cause worry while a month ago
the same news would be ignored or looked on with a positive bias.
The same event will seem different depending on our mood. Little events, petty annoyances, will either cause an outburst or be ignored depending on how we feel that day. Now the market is moving toward where news will be felt to cause worry while a month ago the same news would be ignored or looked on with a positive bias.
There is a tide in the affairs of men,
Or lose our ventures.
06/08/98
The probabilities are high that the market bottomed on 6/4. Technically
the DJIA needs to hold above the 8750 low during the week ending 6/12
to
generate a CTI Buy signal. Market Posture upgraded to Neutral 6/5/98.
Check out "On
The Edge"-a monthly review of the markets-updated 6/1/98.
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
________________________________________________________________________
CURRENT PRIOR
MARKET TIMING MODELS READING WEEK CHG CONNOTATION
________________________________________________________________________
CYCLICAL TREND INDEX (CTI): -4 -4 0 BEARISH
MOMENTUM INDEX: -7 -8 1 BEARISH
SENTIMENT INDEX: 2 1 1 BULLISH
________________________________________________________________________
DOW JONES INDUS TRIAL AVERAGES (DJIA) CLOSE:................ 9037.71
DJIA POINT CHANGE FROM PRIOR WEEK:......................... 137.76
DJIA PERCENTAGE CHANGE FROM PRIOR WEEK:.................... 1.55%
MARKET POSTURE THIS WEEK:.................................. NEUTRAL
MARKET POSTURE PRIOR WEEK:.................................MILD BEARISH
DJIA TARGET:............................................... N/A
TIME FRAME TO ACHIEVE TARGET:.............................. N/A
DATE CURRENT MARKET POSTURE FORMULATED:.................... 05-Jun-98
DJIA CLOSE ON DATE CURRENT MARKET POSTURE FORMULATED:...... 9037.71
________________________________________________________________________
CYCLICAL TREND INDEX (CTI).......... -4 CONNOTATION
________________________________________________________________________
15-Jun-98 (Projected) 7 BULLISH
22-Jun-98 (Projected) 7 BULLISH
29-Jun-98 (Projected) 7 BULLISH
06-Jul-98 (Projected) 7 BULLISH
13-Jul-98 (Projected) 4 BULLISH
________________________________________________________________________
MOMENTUM INDEX...................... -7 % CHG CONNOTATION
________________________________________________________________________
1) DJ Transportation Average 3326.55 -0.6% BEARISH
2) S&P 500 Index 1113.86 2.1% BEARISH
3) NYSE Composite Index 575.37 1.8% BEARISH
4) Advance-Decline Line -6551 BEARISH
5) 10 Day MA Advance-Decline Line 0.90 14.0% BEARISH
6) AMEX Index 713.12 -0.2% BEARISH
7) NASDAQ Composite Index 1772.92 -0.3% BEARISH
8) DJ Utilities Index 292.36 2.7% BULLISH
9) TRIN-10 Day Average 1.10 -7.6% NEUTRAL
10) NYSE New Highs-New Lows 167-242 BEARISH
11) Zweig Breadth Indicator 0.58 NEUTRAL
12) McClellan Oscillator 43 NEUTRAL
13) McClellan Summation Index -204 NEUTRAL
14) Unchanged Issue Index 0.16 BEARISH
________________________________________________________________________
SENTIMENT INDEX..................... 2 % CHG CONNOTATION
________________________________________________________________________
1) Odd Lot Short Ratio-5 Day Ave 4.78 -2.8% BEARISH
2) NYSE Short Interest Ratio 6.32 0.0% BULLISH
3) Public-Specialist Short Ratio 1.13 -1.7% BULLISH
4) Put/Call Ratio-10 Day Ave(INDEX) 1.29 12.4% BULLISH
5) Dividend-Yield Spread 4.99 5.1% BULLISH
6) Mutual Fund Liquid Asset Ratio 4.60 0.0% BEARISH
7) Bullish Investment Advisors 42.8 -4.5% NEUTRAL
8) Bearish Investment Advisors 28.6 3.6% NEUTRAL
9) Bearish + Corrections Total 57.2 3.6% NEUTRAL
Last week's letter at bottom: T
he Market Posture
was downgraded to Mildly Bearish the week ending
4/10/98 (DJIA - 8994.96). Initial downside price projection for
the DJIA
is 8750. CTI readings should remain negative until early
June 1998.
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
Wednesday June 10, 1:18 am Eastern Time
HK stocks end morning sharply off, rocked by yen
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
HONG KONG, June 10 (Reuters) - Hong Kong's Hang Seng Index sank to its
lowest levels since mid-January on
Wednesday morning, closing sharply lower at midsession as yen weakness
and concerns about the Chinese yuan pushed prices
into a tailspin.
The Hang Seng Index closed the morning session at 8,036.17 points, down
355.29 points, or 4.23 percent.
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
The red chip Hang Seng China Affiliated Corporations Index sank even
further, sliding 58.90 points, or 6.30 percent, to
876.02 while the H-share index fell 22.88 points, or 5.03 percent,
to 432.42.
``Currencies are at the forefront of everybody's mind.
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
The market is
obviously focused on a possible devaluation of the yuan,''
said Steven Thompson, chief analyst at Nikko Research Center.
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
Yen, China fears spark panic-selling in Asia
By Stuart Grudgings
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
SINGAPORE, June 10 (Reuters) - Contagion from Japan's sagging yen raced
through Asian markets in early Wednesday
trade, sending Hong Kong shares plunging more than four percent and
turning the screw on Australia's hapless dollar.
Other regional currencies and all major Asian equity markets were on
the slide as panicky investors bolted for the exit.
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
With the yen showing few signs of life ahead of a key economic meeting
in Paris, dealers said fears were growing the currency's unchecked fall
could spark a devastating new round of regional devaluations -- perhaps
starting with China's yuan.
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
Thursday June 4th
News that the German economy is growing at its fastest rate since 1990
and an easing of worries over Russia helped push the
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
dollar down its lowest point against the mark in a week.
---------------------------------------------------------------
MARKET PRICES AT 0949 GMT
Mark 1.7658/68 Yen 138.23/28 Sterling 1.6378/88
Gold $292.00/2.50 -0.14 (pvs PM fix) Brent $14.36 +0.32
FTSE 100 5876.2 -22.2 CAC 4126.72 -22.65 X-DAX 5605.66 -34.76
---------------------------------------------------------------
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
By Malcolm Davidson
LONDON, June 1 (Reuters) - Holiday-thinned European
stock markets fell sharply on Monday as political and economic turmoil
in Asia knocked confidence in shares and helped drive the dollar to near
seven-year highs.
Most European bourses were closed for a public holiday,
but London led the way down in Europe by falling up to 1.5 percent in early
trade.
London investors took their lead from a 0.78 percent
decline on Wall Street on Friday and big losses in Asia overnight. Tokyo
stocks fell more than 2.2 percent, but Hong Kong fared even worse with
the Hang Seng index slumping 3.61 percent.
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
Benchmarks:
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
London 6,100 - record highs
Paris 4150* high, Frankfort 5,650 * high
---------------------------------------------------------------
Tuesday, June 2
(Reuters) -
The yen was volatile in early European trade on Tuesday, recovering
from a new seven-year
low against the dollar after supportive comments from Japanese Vice
Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
---------------------------------------------------------------
Tuesday, June 2
low against the dollar after supportive comments from Japanese Vice Finance Minister for International Affairs Eisuke
Sakakibara.
European equity markets were mixed as investors stayed nervous after
an uncertain performance from the Dow and amid
continued concern over political and financial problems in Asia.
---------------------------------------------------------------
MARKET PRICES AT 0940 GMT
Mark 1.7785/90 Yen 138.85/95 Sterling 1.6364/74
Gold $289.00/9.50 -3.15 (pvs PM fix) Brent $14.16 -0.07
FTSE 100 5834.4 -3.5 CAC 4065.83 +24.67 X-DAX 5570.93 +13.94
---------------------------------------------------------------
``Equity markets are still looking febrile,'' said one London dealer.
``
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
There is a growing group of people thinking we will be
inevitably be hit by a deflationary wave.''
Monday June 1, Monday June 1,
Monday June 1, Monday June 1,
FOCUS-Asian troubles help drive stocks, yen down
FRIDAY:
"I can't see anyone wanting to take this market upwards,``
said one equity salesman in London. ''We are still experimenting with the
downside.``
A combination of weak Japanese economic data, the steep
fall in Tokyo stocks and a decline in Japanese government bond yields were
blamed for ren ewed pressure on the yen, which fell to a near seven-year
low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology
sector dragged the stock index to a sharply lower close on Monday, with
investors rushing to dump shares amid mounting worries over Asia's economic
woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell
5.39 percent on eve of one of Taiwan's biggest computer expositions, as
confidence evaporated following Wall Street's big declines and heavy institutional
selling
* Selling accelerated in final hour, with index touching low of 7,574.51
-- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones
industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while
technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent,
to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness
over Wall Street's downturns and weakness in Asia's currencies, and headed
further south through the session as lingering confidence evaporated, brokers
said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
"I can't see anyone wanting to take this market upwards,`` said one equity salesman in London. ''We are still experimenting with the downside.``
A combination of weak Japanese economic data, the steep fall in Tokyo stocks and a decline in Japanese government bond yields were blamed for ren ewed pressure on the yen, which fell to a near seven-year low of 139.37 yen to the dollar.
Taiwan stocks end sharply down on hi-tech selloff
TAIPEI, June 1 (Reuters) - A panicky selloff in Taiwan's high-technology sector dragged the stock index to a sharply lower close on Monday, with investors rushing to dump shares amid mounting worries over Asia's economic woes, brokers said.
* Closing: down 297.09 points/3.76 percent at 7,606.25
* Hardest-hit was the trend-setting electronics sector, which fell 5.39 percent on eve of one of Taiwan's biggest computer expositions, as confidence evaporated following Wall Street's big declines and heavy institutional selling
* Selling accelerated in final hour, with index touching low of 7,574.51 -- a 4.15 pct fall -- shortly before the close.
* Taiwan sentiment hurt by Friday's Wall Street losses. Dow Jones industrial average fell 70.25 points, or 0.78 percent, to 8,899.95, while technologies-driven Nasdaq composite index fell 15.75 points, or 0.88 percent, to 1,778.87.
Taiwan's benchmark index opened sharply lower, reflecting bearishness over Wall Street's downturns and weakness in Asia's currencies, and headed further south through the session as lingering confidence evaporated, brokers said.
The electronics index led the slide, with many shares near or at
their daily seven percent volatility limit.
``
The overall sentiment is negative,'' said Donald Floyd of ING-Barings.
``Most of the selling today was in the electronics sector and this might
mean there are some concerns over personal computer growth and bleeding
prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
The overall sentiment is negative,'' said Donald Floyd of ING-Barings. ``Most of the selling today was in the electronics sector and this might mean there are some concerns over personal computer growth and bleeding prices in the computer industry.''
ASIA MARKETS SUMMARY -Down day on stocks and forex
ASIA MARKETS SUMMARY - Stronger yen brings respite
CURRENCIES.....
Change on the day... WED 03 1001.GMT.
Currency....Latest.......Prev Close.....Pct Move
Ringgit.....3.92...........3.94...........0.51%
Rupiah......11550.00.......11630.00.......0.69%
Baht........42.10..........42.15..........0.12%
Peso........38.75..........39.00..........0.65%
Sing Dlr....1.68...........1.68...........0.27%
Taiwan Dlr..34.19..........34.25..........0.19%
Korean Won..1391.00........1401.00........0.72% ..... .....
Change since start of Asia crisis.....
Currency....Latest.......July '97.......Pct Move
Ringgit.....3.92...........2.52.........-35.71%
Rupiah......11550.00.......2432.00......-78.94%
Baht........42.10..........25.90........-38.48%
Peso........38.75..........26.50........-31.61%
Sing Dlr....1.68...........1.43.........-14.65%
Taiwan Dlr..34.19..........27.75........-18.83%
Korean Won..1391.00........842.00.......-39.47%
************************************************* STOCK MARKETS.....
Change on the day... WED 03 1002.GMT.
Market......Current....Prev Close...Pct Move
Indonesia....392.61......399.60......-1.7%
Malaysia.....526.36......520.61.......1.1%
Philippines..1928.99.....1946.08.....-0.9%
Singapore....1219.80.....1207.12......1.1%
Thailand.....313.21......313.64......-0.1%
Hong Kong....8819.22.....8598.17......2.6%
Japan........15347.00....15554.45....-1.3%
Taiwan.......7643.20.....7565.64......1.0%
Korea........332.46......324.10.......2.6% ..... .....
Change since start of Asia crisis.....
Market......Current....July '97.......Pct Move
Indonesia....392.61......731.00......-46.3%
Malaysia.....526.36......1230.00.....-57.2%
Philippines..1928.99.....2815.00.....-31.5%
Singapore....1219.80.....1981.00.....-38.4%
Thailand.....313.21......569.00......-45.0%
Hong Kong....8819.22....15055.00.....-41.4%
Japan........15347.00....20000.00....-23.3%
Taiwan.......7643.20.....9000.00.....-15.1%
Korea........332.46......770.00......-56.8%
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-
U.S. treasuries rallied on a
wider-than-expected U.S. trade deficit -flight to quality.
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
)
The booming U.S. economy is encouraging Americans to spend more,
and that leads to an increase in imports and widens the trade gap. Meanwhile,
Asia's financial problems are slowing the pace of U.S. exports.
A wider gap means a slower rate of growth in gross domestic product
and that supports bonds.
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
First Call said analysts forecast that S&P500 earnings will grow
8 percent in the second quarter, 13 percent in the third quarter and 18
percent in the final quarter. (
I wouldn't bet on it
Bottom Line:
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
on backloaded earnings growth this year.
Krugmann: "
The
Fed doesn't formally care about anything in particular. That way you can't
pin them
down.
Their nightmare: I know what keeps Alan Greenspan
awake at nights. I don't need any inside
information to tell you
this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the
US in 1969 )
A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
The Fed doesn't formally care about anything in particular. That way you can't pin them
down.Their nightmare: I know what keeps Alan Greenspan awake at nights. I don't need any inside
information to tell you this. He thinks about Japan 1990. ( Sic.. South East Asia in 1997 or the US in 1969 )A stock market that went to dizzying heights and there were lots
of explanations; everybody had a good theory about why that made sense
and then it plunged. And in the course of plunging, took the real economy
down with it and it never actually recovered. And although you can give
all sorts of reasons why the U.S. is different from that, the Fed is very
concerned about that.
They are very concerned that we have a bubble economy,
which is different in detail, but the same general position as Japan before
the big crash. If they could figure out some way to deflate the bubble
gently, they would."
Brancaccio: "Sounds like you're a little worried about that scenario
as well."
Krugmann: "Oh, I'm scared to death! I look at the current level of
the market. I can't come up with a
reasonable reason for it. I can
give you a lot of standard arguments about why, even if the market
should fall 20 percent or whatever, it really wouldn't be devastating
for the U.S. economy. But I think I would've come up with all sorts
of reasons why I would deflate without doing any real harm and I
would've been wrong. I would be very anxious if I were at the Fed to try
an d somehow avoid testing a Japanese scenario."
MIT economist Paul Krugmann's most recent book is called "Pop Internationalism."
NEW YORK, May 7 (Reuters) - Earnings of companies in the Standard
& Poor's 500 index are up 3.1 percent year-on-year in the first quarter
with 91 percent, or 453 companies in the index, having reported, said First
Call.
This could rise to about 4.0 percent once all the retailers have
reported, which would be slightly better than Wall Street expected, said
Chuck Hill, First Call's director of research.
Analysts had slashed their profit growth forecasts for the first
quarter because of Asia's turmoil.
But even 4.0 percent would still be less than half the 9.0 percent
year-on-year growth in the fourth quarter of 1997, and would be well below
the 10 percent growth originally forecast for the first quarter.
Wall Street is still
betting
First Call said analysts forecast that S&P500 earnings will grow 8 percent in the second quarter, 13 percent in the third quarter and 18 percent in the final quarter. (
I wouldn't bet on it
These forecasts may= WILL change over the coming months as more companies
discuss earnings with analysts, First Call said.
This looks like a organized
attempt to talk the market down:
You don't have to shoot the charging bull between the eyes to try
to slow it down. You can use a number of less radical techniques to try
to slow down the ragging bull. You wave red flags, then the picadors poke
at it, then if all else fails you draw on more powerful weapons for the
coup de grace'.
The Fed won’t release this “directive,”
crafted at the
end of each committee meeting,
until May 21.
The primary
significance of the directive
is to signal financial markets
which way the Fed is leaning.
Officials say Asia seems to be stabilizing, and
domestic economic vigor appears to be offsetting the ill
effects of Asian woes on U.S. exports. First-quarter
consumer spending and housing construction was strong,
and the economy appears to be awash in credit. So, in
public speeches and interviews, Fed officials are beginning
to prepare markets for a Fed move to brake the
economy-unless it slows on its own soon.
The Fed has been expecting a slowdown for months,
but it hasn’t materialized. Most forecasters say the
economy expanded at an annual rate of between 3% and
3.5% in the first quarter, which would be the sixth quarter
of better-than-3% growth.
Worries about destabilizing fragile Asian financial markets could
delay a Fed move, but
some Fed officials privately acknowledge that they would sleep better
if the stock market were less ebullient. Indeed, a decline in stock prices
would tend to slow the economy, which is precisely what the Fed would like
to see.
WSJ
Magic,
Science, the market, financial reporting and Beliefs systems such as Futures,
values, prices, rates and other Religions
(1948)
by Malinowski, Bronislaw
The
principle dialectic of the modern world is the dualism of science and magic.
The conflict starts with Newton who spent most of his life at numerical
alchemy.
In
a seminal article Malinowski suggests that "primitive" people use science
to control events they understand and can do something about, and magic
for forces of nature that are out of control.
They are very resonable about
fishing, farming, hunting and warfare when they find a pattern in events
- but magical thinking takes over when events seem out of control such
as storms, earthquakes, plagues, and other unexpected traumas.
Maclay,
Kubary, Malinowski: Archetypes from the Dreamtime of
Anthropology
The
dreamtime is explained in the "Last Wave" a film by Peter Weir - as a reality
that exists beyond the day to day that gives values, meaning to the "Law"
or customs of a people. In this way it is the origin of religion, which
the age of reason called a "superstition ".
Malinowski, Bronislaw Kasper (1884-1942), British anthropologist,
regarded as the founder of the "functional" school of anthropology,
which maintains that human institutions should be examined in the
context of the culture as a whole. He was born in Kraków,
Poland. In
1914 he took part in an expedition to New Guinea and Melanesia and
spent the next four years studying the peoples of the Trobriand
Islands
of the southwest Pacific. Malinowski became professor of social
anthropology at the University of London in 1927. His further research
took him to Africa, Latin America, and parts of the United States.
LAST
WEEK IN REVIEW:
For historical interest, the market will look at the minutes of the
March 31 U.S. Federal Open Market Committee meeting to be released on Thursday.
According to Treasury Department data, foreigners owned 38 percent
of the $3.4 trillion in outstanding Treasury
debt at the end of
August.
The Japanese owned 25 percent of the foreign-held debt, followed
by Great Britain,
20 percent, and Germany, 6 percent.
Japanese officials played down speculation this week of another wave
of Treasury securities selling to finance
a $77 billion bailout
of Japan's banking system.
In addition to capital flows, Wednesday's Commerce Department release
reported the broadest measure of
U.S. foreign trade, known as the
current account. It shot up 11.4 percent to $42.2 billion in the third
quarter, the highest level in a year.
The current account measures not only trade in goods and services
but also the flow of investment income
between countries and foreign
aid.
---------------------------------------------------------------
FRIDAY,
May 29 (Reuters) - European
stocks and bonds were stronger midday on Friday as worries about emerging
markets and nuclear tests on the Indian subcontinent helped the dollar
touch a seven-year high against the yen.
``People are fleeing anything
that's emerging or developing and going for anything with security -- dollar,
marks, sterling and core bond markets,'' said Michael Derks, senior market
economist at Nomura International in London.
---------------------------------------------------------------
MARKET PRICES AT 1126 GMT
Mark 1.7818/27 Yen 138.77/87
Sterling 1.6292/02
Gold $292.00/2.40 -1.8 (pvs
PM fix) Brent $14.09 -0.04
FTSE 100 5899.8 +37.5 CAC 4070.21
+55.29 X-DAX 5578.55 +71.19
---------------------------------------------------------------
Benchmarks:
London 6,100 record high, Paris
4100* high, Frankfort 5,600 * high
WEDNESDAY, May 27th:
MARKET PRICES AT 0943 GMT
Mark 1.7620/25 Yen 137.59/64 Sterling 1.6396/06
Gold $292.35/2.75 -5.4 (pvs PM fix) Brent $14.06 -0.08
FTSE 100 5858.7 -112.0 CAC 3998.21 -117.67 X-DAX 5489.32 -150.57
---------------------------------------------------------------
In London, shares quickly fell through the psychological 5,900 level
at the open, a decline matched across the continent, with Milan, Paris
and Frankfurt showing the heaviest losses.
TUESDAY, May 26th:
South Korea's key share market index hit another 11-year low on Tuesday
amid concern about planned labour strikes, further corporate failures,
and prospects of a quick economic recovery.
The Korea Stock Exchange composite price index lost 6.00 percent,
or 19.91 points, to close at 311.99.
The close was the lowest since February
4, 1987, when it ended at 311.52.
``
The market is in a state of panic,'' said fund manager Park Jong-chan
at Seoul Investment Trust Co. ``I cannot see where the bottom lies.''
Tuesday's dive followed a 6.78 percent drop on Monday.
The rout was blamed on local investors, especially domestic institutional
investors, who dumped stocks on a plethora of bad news, including strong
support for strikes by Hyundai Motor (05380.KS) and unlisted Daewoo Motor
unions.
MONDAY, May 25
(Reuters)
-
The yen slumped to its lowest in nearly seven years against the dollar,
and was seen sliding further, amid speculation the U.S. may be forced to
tolerate the loss of competitiveness that such weakness brings.
European shares extended gains. Paris and Frankfurt broke to new
high ground but business was thin as Britain and the U.S.were closed for
bank holidays.
``It may seem strange the U.S. is still underlining it is interested
in a strong dollar policy when its trade deficit is widening but there
is no other chance of stimulating the Japanese economy and the Asian region,''
Yen losses were triggered after Monday's issue of U.S. News &
World Report reported U.S. Treasury Secretary Robert Rubin was willing
to let the yen weaken to 140 or even 150 per dollar if that was the only
way to keep Japan's economy from collapsing.
SEOUL, May 25 (Reuters) - South Korean stocks tumbled to close at
an 11-year low on Monday as local institutions dumped blue chips and foreign
investors yawned at the removal of the foreign stock ownership limit
THE NEXT
STEP FORWARD
Where
we go from here !
A few years ago we talked about the potential
of the internet -
Doc1 to
Doc5
Then we talked about the impact on the
social
-