Forum Archive Index - April 2000

[jbartley <jbartley@ihug.co.nz>]

There is little doubt in my mind that a crash will come.  The difficulty I
have is that I have been reading predictions for such a crash since 1991.
Prechter from Elliot Wave Theorist was predicting one back then.  The crash
was predicted for last year in Xmas 1998 by  a well known commentator.  A
crash was predicted for 2000 when the bug hit; I am still waiting

I think the only answer is to diversify, do not use any form of leverage and
have a reasonable amount in cash.  I would be interested in the comments of
others

Jim Bartley




At 20:09 04/09/2000 +1200, you wrote:
>When the crash comes there are a few things that you should have already
>done:
>
>1.     Paid off all consumer and credit card debt.
>2.     Sold your house if it has a mortgage and perhaps even if it     doesn't.
>3.     Reduced your personal spending levels.
>4.     Be right out of the market.
>
>People assume that because the underlying economies are strong that this
>will support the stockmarket. That proposition is patently and
>historically false. When the vast amounts of wealth that have
>accumulated on paper are wiped out overnight consumer spending stops in
>its tracks. Recession comes fast and hard and leverage accelerates the
>process.
>
>The market prices are unprecedented in history and it is clear the
>so-called new economy companies will never match the expectations no
>matter how well they perform in terms of profit.
>
>There are also indications that the internet will also be nothing like
>the hopes for it have been. In fact it is trending towards being merely
>a global billing, mail and pornography medium that is making very little
>money (profit) for the participants.
>
>The so-called old economy stocks are also way overpriced. Remember, if
>consumer spending slows right down then old-economy P/E ratios are
>suddenly pushed right up.
>
>Unfortunately, the mania has reached such a fever pitch that the outcome
>will be so bad that it will be the most significant economic event of
>the last 300 years.
>
>The detrious will be catastophic. NZ will be hit with regard to the
>stockmarket less badly that most because the NZ market is all but dead.
>However, there will be a large negative effect. The real economy will be
>badly affected. 
>
>It will be a fascinating study as all panics are.
>
>So, if you are not a professional and you are still in the market then
>you are a fool!
>
>Most of the comments on this tightly regulated stock chat site are  from
>cherries who weren't active in the last crash and have little
>comprehension of what one is like.
>
>No doubt I'll cop some flak from these people for my comments but it is
>to the more intelligent people I am speaking.
>
>So the choice is yours. Either batten down the hatches, day trade
>holding no positions overnight or you will pay the price.
>
>Best of luck.
>
>PS. Have purposely included no humour in this email because I know it is
>objectionable to the site owner and most of the readers.
>
>PPS The last people you should rely on for a view on what is going to
>happen are brokers, analysts and the media who all have their own
>dictated agendas.
>
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>


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