DOW closes at over 9500 today : LUSENET : TimeBomb 2000 (Y2000) : One Thread

hmmm...Japan in meltdown...Russia defaulting...Brazil in bailout...Indonesia rioting...Korea crumbling...Venezuela reeling... looks like everybody thinks the US is a safe haven.

And y2k is approaching. This is gonna be *way* interesting...

-- a (a@a.a), January 06, 1999


a! I know! Doesn't it just blow your mind?

Talk about living in interesting times : )

Mike ===================================================================

-- Michael Taylor (, January 06, 1999.

I'm begining to think (and actually *believe*) that the U.S. stock market lives in a vacuum and *can not* be influenced by outside forces. It's like its taken on a life of it's own and is now too big to kill.

I just don't *get* it.

I probably never will

-- Sub-Mitt (, January 06, 1999.

Hey, I got out six months ago and can sleep at night :)

Good 'ole plunge protection team doing it's job? The Euro? Manipulation of markets? Denial?

Whistling past the graveyard morelike :)

Patience glasshoppaaa

-- Andy (, January 06, 1999.

I came home from the grocery store this afternoon, just before 4 PM, and heard a radio newscast on the stock market. It said the Dow was over 9500 and the Nasdaq had set a record now for four days in a row. My reaction, of course, was "you gotta be kidding!"

Some investment type person described the market as "irrational exuberance, Part 2" and that the market was going up due to its own momentum. The investor said the Dow could hit 10,000--not just by February--but within a couple of weeks. He said internet stocks were the place to be right now.

Also mentioned on the top of the hour news was that the market was responding to Alan Greenspan's rate cuts of the last couple of months, which the investor said had to be made anyway to keep the U.S. out of the world recession, even if these cuts were pushing the market uncomfortably high.

I went and dug out my copy of "Only Yesterday -- An Informal History of the 1920's" by Frederick Lewis Allen. I'm going to reread the chapters this evening "Coolidge Prosperity," "The Big Bull Market" and "Crash!"

The bigger they are, the harder they fall.

-- Kevin (, January 06, 1999.

Volume heavy and Advance/Decline line WEAK for this kind of move. Not a healthy sign !!


-- Ray (, January 06, 1999.

January bounce, safe haven, irrational exuberance, you name it. The market is in the real world, though, where Venezuala and Japan and Brazil and S. Korea are toppling and people there with money see the US of A as the last boom market. All the US economic news of late has been bad-higher unemployment, high trade deficit, lower industrial prodcution. New home sales are up, the one bright spot. Yeah, this is gonna be real interesting.

-- cash (, January 06, 1999.

"New home sales are up, the one bright spot."

A friend of mine just paid $450,000 for a nicish house in Burlingame, CA, and is saddled with an enormous mortgage.

His wife is just pregnant, and wants to stop working. No way, San Jose, we have a *mortgage* to protect...

Wonder how much the house will be worth once a depression kicks in, work is hard to come by, the negative equity will kill millions of folks even if y2k doesn't.

-- Andy (, January 06, 1999.

I was watching it all day go up, up, up. I expected it to start going back down in the afternoon, as is often the case before the bell, and then it closed up 233.78, 69.59, and 27.53. Simply incredible...

-- pshannon (, January 06, 1999.

It is said that the market cannot discount more than 6 months out. By this theory, y2k cannot be an influence until July or so.

-- Blue Himalayan (bh@k2.y), January 06, 1999.

Silver made a big move up today (4.91 to 5.15). What's up with that?

MoVe Immediate

-- MVI (, January 06, 1999.

Make new friends But ke-e-e-ep the old, one is silver and the other, gold ...

My kindergartener's song just keeps playing in my head.

Who was that economist who predicted the Dow at 10,000 before 2,000? The one who originally predicted the 5,000 Dow? Wait, I'll get back with the answer. You know, that guy who's now predicting disaster with y2k?

I'll post back.

-- jhollander (, January 06, 1999.

Historically, market investors were savy, well informed people. Now the masses are investing. Taking into account how the "sheeple" feel about y2k, it could account for the current exuberance. That's the only reason I can think of, other than US markets being the "last global heaven".

-- Chris (, January 06, 1999.

So folks, did we all ejaculate to quickly? I mean pull out sooner than we should have? No use crying over spilled _______, you fill in the blank! I think I'll jump back into the game, but something keeps ringing in my head, that when the dow took a dive a couple months ago and dropped below 9000, it was called a correction because stocks were over priced, well, aren't they still over priced at 9500? Please explain it to me!

-- gambler (, January 06, 1999.

Gambler - I think I made +20%-30% a year for the last 3 or 4 years - how much is enough???

Don't be greedy. Why gamble the farm this late in the game?

What was that saying about bugging out to the hills? :)

-- Andy (, January 06, 1999.

Gambler - I think I made +20%-30% a year for the last 3 or 4 years - how much is enough???

Don't be greedy. Why gamble the farm this late in the game?

What was that saying about bugging out to the hills? :)

I'm serious, I can't remember the quote, but it was apt for the market too!

-- Andy (, January 06, 1999.

Bulls get rich. Bears get rich. Pigs get slaughtered.

-- Mac (, January 06, 1999.


Where does the strength of the dollar factor in. If the dollar weakens, It has been said that the feds will have to raise interest rates to hold investors in government debts.

I too am astonished at the rise unless one takes into account money has to be invested somewhere. Where better in the world.

I think that the insiders will get out fast should the bottom appear. Anyone out there know if this is going on? I had heard that a lot of internet stock insiders were getting out. ww


I think gambler just proved my point...

-- Chris (, January 06, 1999.

I got out late last year. It's just plain irrational (nuts). I know people who are planning to take their money out later this year but I fear that it will be too late. I expect some totally unforeseen event to cause a "correction"-- an earthquake or perhaps a serious terrorist event on US soil. Kitty in VA

-- Kitty in VA (, January 06, 1999.

Illusions, illusions.

At the same time I'm showing today's FEMA Alert and the article on the National Guard to a finally "GI" they are also hearing the 9,500 news and are "glad" they are still in.

Do we have any guesstimates on when it hits 10,000?

All this on the eve when the Senate trial is about to get underway. Amazable.


-- Diane J. Squire (, January 06, 1999.

We were getting ready to invest a good sum of money in the market,but have been persueded to wait,at least a year.Hope there will still be a market to invest in, come Jan.00. Mike and Susan in Fl.

-- Susan (, January 06, 1999.

At the site I go to for new economic statistics, there is a link with the title "The Stock Market Revisted". The brief description of what's at the link is this:

"The S&P 500 rose more than 25% in 1998, its fourth straight over 20% annual gain. Each new high occurs despite the fact that the stock market is substantially overvalued according to virtually all historical standards."

Here's a paragraph from the "Stock Market Revisted" article:

"Most notable is that the S&P 500 is currently trading at over 32 times four quarter trailing corporate earnings. This is more than double the average price-earnings ratio (PE) experienced since World War II."

This economic statistics site known as "The Dismal Scientist" is at:

-- Kevin (, January 07, 1999.

Some sorts of history repeat and this is surely one of them.

Look up "The great crash 1929", then read the book by JK Galbraith of the same name. Then look up the South Sea Bubble. Then if you need convincing find out about the crashes that happened every 50-60 years between these two events. If you still need help, read up about the long-term economic cycle (aka the Kondratiev cycle). My personal belief is that human nature dictates that a bubble and crash is inevitable every time the last generation to have experienced one is no longer amongst us -- this is something where "those who do not learn from history are doomed to repeat it".

Then ask yourself if you REALLY think "its different this time" ... which is exactly what everyone who lost their shirt did every time before.

As for the straw that'll break the camels back ... Y2K anyone?

-- Nigel Arnot (, January 07, 1999.

and to recap just how stupid people can be, lets not forget the great tulip panic: (from another author)

Before closing, let me impart a few incredible facts about Tulipomania, for those who aren't too familiar with it. It occurred in the mid 1600s in, you guessed it -- Holland. Galbraith expresses some wonder that the speculation of the times didn't settle on real estate or magnificent Dutch paintings, but on tulips: "Nothing more improbable ever contributed so wonderfully to the mass delusion here examined." The story is pretty much the same one as I described in my fictitious feather fable above. By 1636, a tulip bulb originally worth very little would fetch "a new carriage, two grey horses and a complete harness." This wasn't even the peak. These bulbs often weren't even planted -- just exchanged for higher and higher prices. Galbraith retells a painful story of a foreign visitor in a Dutchman's house mistaking a tulip bulb worth $25,000 to $50,000 for an onion and eating it. Ouch.

Fools are hereby advised to stop and smell the flowers, but never to get caught up in reckless financial speculation about flowers, penny stocks, beany babies and other improbabilities.

-- a (a@a.a), January 07, 1999.

You knew once I got back that I wouldn't be able to resist this, now didn't ya?

The following is a quote from James Grant (interest Rate Observer) from about a year ago:

"Just because markets are manic and absurd doesn't mean that they will not become more manic and absurd."

Also, keep in mind what AG (Alan Greenspan) said two Decembers ago - his now-famous "irrational exuberance" speech - If he said was talking about irrational exuberance when the Dow was around 6000, what do you suspect he thinks of these much higher levels?

This morning on CNBC Alice Rivlen (sp?) basically said the markets are overpriced by any measure you choose to use. This is, naturally, an understatement. The markets are headed for a cliff, even without Y2K. The higher it goes, the lower it will fall. Buy some more Danish Hams and Spam.

'Nuff said.

-- Rob Michaels (, January 07, 1999.

Rob Michaels;

Uh, er, ah, were you gone Rob?

Welcome back.


-- sweetolebob (La) (, January 07, 1999.

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