|
|  |
Web of Finance
474 hits
| Mar 10, 2004 1:21 am |
|
re: Reply to Rakesh - Market Direction |
Jacob Kaldenbaugh
 | |
Melanie,
If you're saying we're in a correction, I'm inclined to agree with you. I think we'll see some volatility as it hashes out, but I am strongly biased for continued declines. I'm always negative the market when gas prices get this high, and they're close to record highs right now. I believe that gas prices remove such a great deal of capital from business and consumer accounts, that it stunts economic growth. I've been asserting for some time now that the Fed would sit tight on rates. While I never felt that the economy was rebounding as much as the market believed, I think that recent comments by Greenspan indicate that he may be considering an increase now. Especially if you believe, like some do, that the increase in commodity prices presages extensive inflation. It's almost a chaos type of analysis because if gas prices also continue to rise, then we could see a real dampening of the economy as consumers get hit in the pocketbook. Should be interesting to watch. Regardless, the only sector I'm a fan of at the moment are select international plays.
Tech is somewhat of an anomaly. Tech continues to show fundamental strength, but it's pretty fully valued right now. We won't have a replay of 2000 because most tech companies are better run and capitalized than they were then. What we are seeing is that valuations are getting stretched as investor expectations have gotten ahead of the reality of growth (it's coming, just not *that* fast).
I still like media companies that are trying to put together a digital model. It's still early, but I don't see anything that discourages me from the sector. I am, however, being very picky about valuation. That being said, it's good to see Apple continue to rise, especially in this market. Wait until the market figures out its retail+small biz strategy! I think it'll see $30 by the end of the year, easy.
Hope all is well.
Best,
Jake
> Melanie Hollands wrote:
> Rakesh,
>
>Your interpretation of my market note below is not correct.
>
>My note refers to the process of correction that began in mit-to-late January, 2004: 1) on January 13 for the SOX (January 13 being the date that Index peaked), and 2) on Janaury 26 for the Dow, S&P 500 and NASDAQ (January 26 being the date those Indexes peaked).
>
>I don't belive that tech is "about to tank" and did not write that.
>
>However, I did write that I believe this correction is not over.
>
>I belive that the correction will continue with the market moving sidewaye with a downward bias for another month or more (possibly, stress POSSIBLY, as long as anotehr four months but there are a number of factors that could influence how much longer the market corrects.) I will take it as it comes; but for now I don't believe that the correction, which has been underway for 6 weeks or more now, is over. That said, today was a weak day across the board and if this continues, and we get sufficiently oversold, then we should bounce a bit at some point.
>
>I hope this clarifies my views.
>
>Cheers
>
>Melanie 
Private Reply to Jacob Kaldenbaugh (new win) |
|
