From the Princeton Economic Institution For Educational Use Only We hope that our advice of a week ago has served you well. At that time we warned you that stocks may begin a sell-off around mid-September. Stocks sold off today handsomely. The DOW was down 225 points. The S&P December contract closed today at 1321.90 and a weekly close below 1292.50 basis S&P Dec contract will confirm a correction which may take stocks back to their October 1998 Lows (a 35% correction from the the July Highs).

The risk is clearly there. Watch closely to see how the S&P December contract closes this Friday. If it closes below 1292.50 (Dec), don't be looking to buy dips!!!

The big event today during Tokyo time was the decision by the Bank of Japan NOT to increase the money supply. The consequences of this action are huge. As traders look back on what got things going in this stock market selloff, they may remember this action of the BOJ just as they still remember the actions of the Bundesbank in 1987.

DLR/YEN continues to sell off as traders saw an unexpectedly large trade deficit combined with the BOJ refusal to increase the money supply as cause to sell dollars. And as the dollar heads south, so goes the US bond market and US stocks. As some point the currency losses by Japanese investors become just too much....leading to panic selling of US assets.

But there are no winners in this game. The Nikkei will probably open 300 points lower and may not look back. (A stronger Yen is not particularly good news to Japanese exporters.)

DLR/YEN could easily test JY 100 in the near future and although we don't see New Lows for the dollar against the Yen, we do see that the Yen may continue to strengthen until the BOJ begins to realize the foolishness of their current monetary policies. Once a more enlightened view emerges at the BOJ, look for the beginnings of a bull market for DLR/YEN that could carry the dollar to over JY 200 into 2003. You are walking through history at this very moment, whether you know it or not. Historians will look back at the mistakes of the BOJ the same way they look at the mistakes of the FED in the 1930s.

The picture for US Bonds is a little more complicated. Japanese may be forced to sell US Bonds as the USD continues south and to cover losses on the Nikkei as it too heads south. But at some point a flight to quality by US based investors may cause b

-- thinkIcan (thinkIcan@make.it), September 21, 1999

Answers

It might be time to start thinking about exiting this market

-- thinkIcan (thinkIcan@make.it), September 21, 1999.

To the Top

-- thinkIcan (thinkIcan@make.it), September 21, 1999.

Fat lady now keying up.

-- a (a@a.a), September 21, 1999.

As a point of reference, S&P December closed around 1350 Monday -- about 1322 today. 1292.5 by Friday?

-- DaveW (dwood@southwind.net), September 21, 1999.

a: Let's hope the fat lady suffers a bout of laryngitis.

-- Randolph (dinosaur@williams-net.com), September 21, 1999.

Does anyone know if this is the Princeton group run by the recently- arrested Martin Armstrong?

-- mike (maples@voy.net), September 21, 1999.

Is this a joke or what? The Princeton Economic Institution made headlines last week when its owner, Martin Armstrong became the subject of an investigation by the SEC, and CFTC.

According to the Wall Street Journal, they lost over 90% of their money under management.

-- Sandwich (anon@anon.com), September 21, 1999.

Mike,

They have the exact same name! Maybe it's just a copy cat. LOL

-- Sandwich (anon@anon.com), September 21, 1999.

Maybe you ARE confusing the names.

Don't know a thing about this Princeton, but take a look at the prediction in his 5th paragraph!

As I type this now (9:30 p.m. EDT), the NIKKEI is down A WHOPPING 550 POINTS.

Mind you, it has been very volatile over the past two weeks. To see what the markets have in store from a historical perspective, go to http://www.investech.com

Jim Stack has an amazing compilation in his 12-page INVESTECH issue, which is every 3 weeks. You can get a FREE sample copy if you look to the left side of the main page. I don't get any compensation for putting a plug in her. It's just that we are in VERY dangerous territory here.

Note that Princeton also says "LOOK OUT BELOW" if the S&P500 dec futures closes just TWO PER CENT below where it is now! NOT GOOD.

We'll see tomorrow.

-- profit_of_doom (doom@helltopay.com), September 21, 1999.

Fat lady now moving to the microphone...

-- a (a@a.a), September 21, 1999.

Wait, the fat lady just got beeped by her broker.

She whips out her cell phone and listens intently.

-- Randolph (dinosaur@williams-net.com), September 21, 1999.

***********Not all the spin is limited to Y2K************************* Princeton Economic Institute September 20, 1999

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The Princeton Economic Institute is an independent research organization and is not owned by Martin Armstrong nor is Mr. Armstrong a director of the Institute. It is NOT related to Princeton Global Management or part of Princeton Economics International nor does it engage in the management of any funds.

Our daily forecasting reports, Global Market Watch and system models used at Princeton Economic Institute are independent models that are not the product of any single analyst. It is our intent to continue to publish our research and bring an independent and objective information to our many loyal clients around the world.

While Mr. Armstrong has always been an outspoken opponent against government manipulations, interventions and "the billionare's club", his direct warnings about the political corruption in Japan and the billions of dollars in hidden losses within its financial system , in some cases carried out by ex-MOF officials, have put him in the direct line of fire by the Japanese government as the man they most wish to discredit. No doubt his highly critical stand against the accounting systems used by all governments that falsely distort CPI, GDP, trade statistics, poverty statistics and taxation have not made him very popular in some circles. His outspoken warnings about the failure of the Euro have also created a few enemies. Mr. Armstrong has always been aware that his research has made him a target over the years nevertheless, he has always stood his ground.

Mr. Armstrong's involvement as an activist in governmental reform is well documented particularly in the field of global tax reform and its impact upon the economy. He stood by his convictions against the birth of the G5 back in 1985. When his Economic Confidence Model pinpointed the precise day for the low during the crash of 1987, he stood alone calling for new highs into1989. His research was even requested by the Brady Commission charged with investigating the incident and some of our clients were on the Commission itself (See Request). He became famous in Japan when his model also projected the high for the Nikkei in 1989 and boldly warned that the market would collapse by 20,000 points within 10 months. His research forewarned of the bull market in US and European equities in 1994 calling for the Dow to reach 6,000 by 1996 and later 10,000 by 1998. (See Vancouver Sun) His research warned of the Asian Crisis in 1997 and of course his model was able to project the collapse of Russia which made headlines in the London FT. His warning that the Euro would fail made him an enemy to some political groups in Europe. Of course when the very same model that pinpointed the 1987 Crash, Tokyo Crash and the birth of the bull market in equities also gave July 20th as an important major top last year, the validity of more than 20 years of his model became undeniable.

As staff members here can attest, even the CIA approached this office requesting that Mr. Armstrong assist the government in duplicating his model just last October, but he refused offering advisory services while insisting that the model remain proprietary. Mr. Armstrong was invited to China by the government where the Chinese made a similar proposal to obtain his model following his successful forecast of the Asian Crisis in 1997. Even after a visit to Princeton in 1998 by a representative of China, Mr. Armstrong still refused to cooperate with the Chinese insisting that the model remain proprietary.

-- thinkIcan (thinkIcan@make.it), September 22, 1999.

The Nikkei finished down 607. I bet its going to be a hot day on the market today. I'm out and sitting on the sidelines laughing. Remember not everybody can get out while the market is on TOP. I wonder if they will be buying the dip today. LOL

-- y2k dave (xsdaa111@hotmail.com), September 22, 1999.

Profit of Doom:

"I don't get any compensation for putting a plug in her." Doesn't this post properly belong on the prostitution thread from two days ago?

-- just wondering (um@um.um), September 22, 1999.