Zeev's Turnips Patch-No Politics (ZEEV)

[boggy]

Dear Zeev-

After reading your post about your outlook for the future of the markets, I wanted to share Richard Russell's recent thoughts:


<<<As for the stock market, we've just had the first 90% downside day. What this 90% day signifies is that the stock market is now open to, and readying itself for -- all-out panic.

I think where we are now is on track for the wide-open panic phase of this bear market. Note, I did not say a panic moment or a panic day, I said a panic phase. The panic phase could take a week or a few weeks or a few months.

Before the panic has ended, stocks will be knocked to their knees, consumers will be in shock, the housing bubble will have burst as will the auto-buying bubble, the July 23 lows will be history, and the "A" wave of this bear market will finally have come to an end.

When the panic phase ends, investors and speculators will be in shock, and the stock market will appear to be shattered -- torn apart, literally in pieces.

That will give us the most "sold-out" market in years. This sold out market will set the base for the corrective (upside) wave "B" of this bear market. The "B" wave should be an upside whopper, and it should carry well into next year. After this corrective "B" leg will come the final "C" leg -- but I'll talk about that when the time comes.

Question -- "Russell, why do you think the coming panic will be so severe?

Answer -- Ironically, the reason I believe it will be so severe is that it has been preceded by the largest load of misplaced bullishness, across-the-board denial, trash talk, and Wall Street baloney, that I have ever seen. It has been preceded by weeks and months of misguided optimism and ignorance concerning the meaning of the primary bear trend.

Instead of recognizing that this is a bear market and therefore preparing for major trouble, the US government has been spending its head off, states and cities have been running up huge deficits, business has loaded up on debt, and consumers have been buying as if a bull market is just starting.

All of this lays the groundwork for shock, surprise and horrendous losses. Frankly, I can't remember a situation like this in the half century that I've been watching markets>>>


If I am to compare his post to yours, I would assume that you both see a drop (Russell feels panic/washout) in the next 1-3 months followed by a cyclical bull (B phase) into 03 followed by the final bear bottom into the end of 2004-5.

Is this what you think? And do you feel that your position approximates Russell?

Please respond and Happy New Year!