AI
Saturday, December 14, 2002 5:25:08 PM
Sorry to take so long in responding. I was busy with some seasonal shopping commitments.
what I don't like in Hamilton's analysis is its "selectivity", data that do not fit are not included. This great bear market had two additional monster runs, the one from late May 2000 to a major double top in the Autumn, and the late December 2000 late January 2001 run ...How can one build a statistically significant model from 5 events while dropping two of the events as outliers?
Well, Hamilton will have to defend himself. OTOH, I can tell you why I wasn't as bothered as you apparently are. So that we have something to refer to
In the Fall of '00, we had a conversation on V's Porch regarding the three stages of a bear market: Denial, Panic and Capitulation. Referring to the above diagram, I would characterize the fall from March '00 to Memorial Day as the Denial phase. Then a respite from Memorial Day to Labor Day preceded the Panic phase that endured until the Easter/Passover period of the following spring. Subsequently, we've had what I would call the Capitulation Grind.
From the above perspective, it would seem most appropriate to compare the current rally with the other two rallies in the capitulation phase rather than the pause between phase one and two or the brief hiatus in the Panic plunge. One could argue that the interplay of emotions and market valuations differ in the different stages of the bear as it matures.
All JMO and as I said Hamilton will have to defend himself.
lurqer
what I don't like in Hamilton's analysis is its "selectivity", data that do not fit are not included. This great bear market had two additional monster runs, the one from late May 2000 to a major double top in the Autumn, and the late December 2000 late January 2001 run ...How can one build a statistically significant model from 5 events while dropping two of the events as outliers?
Well, Hamilton will have to defend himself. OTOH, I can tell you why I wasn't as bothered as you apparently are. So that we have something to refer to
In the Fall of '00, we had a conversation on V's Porch regarding the three stages of a bear market: Denial, Panic and Capitulation. Referring to the above diagram, I would characterize the fall from March '00 to Memorial Day as the Denial phase. Then a respite from Memorial Day to Labor Day preceded the Panic phase that endured until the Easter/Passover period of the following spring. Subsequently, we've had what I would call the Capitulation Grind.
From the above perspective, it would seem most appropriate to compare the current rally with the other two rallies in the capitulation phase rather than the pause between phase one and two or the brief hiatus in the Panic plunge. One could argue that the interplay of emotions and market valuations differ in the different stages of the bear as it matures.
All JMO and as I said Hamilton will have to defend himself.
lurqer
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