dead cat bouncing, page-27

Austravel

I guess it is a matter of perspective.

Like the last rally we are looking at 252 pts approx on SPI at the open.

252 pts up after a 3750 pt fall is not much of a bounce.

I guess a dead cat could bounce 6% from the footpath and still be dead.

All terms such as 20% means a bull or bear market are as meaningful as 2 or 3 quarters of negative growth mean a recession.

These are arbitrary numbers that some fool has suggested and others have latched on to.

Whether this is an official dead cat bounce or an official new bull market is meaningless.

What we do know is that this is or has been a major bear market. Technicals suggest that under criteria of modern experience, this decline is very extended.

The problem is determing whether this is a 1 in 50 or 100 year event or is it a 1 in 1000 or 100000 year event.

Economists are good at looking at recent experience at continuing the trend ad infinitum.

Most that call for a devestating alteration to the status quo are usually derided and time and time again proves that case.

Yet I believe those with knowledge of history understand that earth shattering changes to nations and the world in general do happen.

Is this one? Only time will tell. The odds say no, but some times the longshots come home a winner.

What to do! Your grandparents etc, will tell you to be debt free as possible. Wisdom from people who have lived a long life. As for investing, risk what you can afford to lose. I suspect that the day of the boasting Porsche driving money fiddler will succumb to the producer of goods or services as it should be.

Maybe I am wrong this time but history teaches that it is inevitable sooner or later.