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The Long March of History

History is replete with examples of markets surging higher for months after the problems became well known and well publicized, such as the US market from March to October 1929. The newspapers were full of warnings about the market and Fed tightening in March of 1929 when the market suffered what was to be temporary break, a warning shot across the bow. It then recovered to surge to new highs, finally peaking in August 1929. And we all remember that after the Naz got fried in April 2000, the broad market went back up to retest the highs in September.

This market is no different. The clock is ticking, and the warnings are out there in the more respectable agents of the mainstream media. The New York Times this morning ran an editorial almost pleading with investors to pay attention to the risks.

Liquidity moves markets!

Follow the money. Find the profits! 

For now, I am overwhelmingly long in the WSE Pro chart picks, weighted in energy and tech, but with one eye on the clock, one eye on the charts, and a finger on the trigger. This is one move I would not want to overstay. I am also still holding several housing shorts. Regardless of how far this rally extends, it looks likely to be selective, leaving a large number of groups and stocks behind.

WSE contributor Mark Pierce noted this morning that the utilities are still on a roll. My position would be that the utilities appear to be in the end stage blowoff of a mania that has lasted for years. Enjoy it while it lasts. These stocks along with REITs will be the best shorts when this ends.
Five months and counting.

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Lee Adler

I’ve been publishing The Wall Street Examiner and its predecessor since October 2000. I also publish LiquidityTrader.com, and was lead analyst for Sure Money Investor, of blessed memory. I developed David Stockman's Contra Corner for Mr. Stockman. I’ve had a wide variety of finance related jobs since 1972, including a stint on Wall Street in both sales, analytical, and trading capacities. Prior to starting the Wall Street Examiner I was a commercial real estate appraiser in Florida for 15 years. I was considered an expert in the analysis of failed properties that ended up in the hands of bank REO divisions, the FDIC, and the RTC. Remember those guys? I also worked in the residential mortgage and real estate businesses in parts of the 1970s and 80s. I have been charting stocks and markets and doing analytical work since I was a teenager. I'm not some Ivory Tower academic, Wall Street guy. My perspective comes from having my boots on the ground and in the trenches, as a real estate broker, mortgage broker, trader, account rep, and analyst. I've watched most of the games these Wall Street wiseguys play from right up close. I know the drill from my 55 years of paying attention. And I'm happy to share that experience with you, right here. 

  1 comment for “The Long March of History

  1. Frothy Conundrum
    March 26, 2007 at 2:58 pm

    Five months? Could be Sow 15K by then.

    Potentially well beyond attention span of many-here, and society at large.Could see a dozen new prezydental poll front lungers thru out, # of calls/turns/retractions from McHuge,Shtinker, Prechter(!), et al, could hit hundreds! Cramer clarifications, retractions(indictments?), potentially infinite!

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