Where is the Dow heading?

[John]

> Here is Mike Alexander's latest forecast.

> http://www.safehaven.com/article-11887.htm

Thanks for pointing that out.

As you know, I like Mike Alexander, and he actually helped me quite a
bit. He spent years pounding me with really hard-hitting criticisms
of Generational Dynamics that forced me to strengthen the theory to
make it bulletproof.

There were other people in that forum (including some academics who
you'd think would know better) who were incredibly vicious and
destructive, but Mike never crossed that line, even when he was
driving me nuts.

Having said all that, the safehaven article is crazy. It's so far
from reality that I can hardly believe he wrote it. Actually, I can,
since I understand enough of what his methodology is, but if he keeps
following that path with his own investments he's going to be very
badly hurt, which I don't like to see.

Sincerely,

John

[John]

Dear Pat,

> $30,000 would probably come sometime in the 2100s, possibly just
> as another long wave was swelling.

Well, don't forget that The Singularity is arriving around 2030, the
point where computers will take over from humans as being the most
intelligent "species." Whether the human race will survive after
that is in question, but at the very least, all cycles, whether
generational or long wave or whatever, will be destroyed.



Sincerely,

John

[Higgenbotham]

> Here is Mike Alexander's latest forecast.

> http://www.safehaven.com/article-11887.htm

Thanks for pointing that out.

Having said all that, the safehaven article is crazy. It's so far
from reality that I can hardly believe he wrote it. Actually, I can,
since I understand enough of what his methodology is, but if he keeps
following that path with his own investments he's going to be very
badly hurt, which I don't like to see.

Sincerely,

John

Well, I get the idea that he already has been hurt a bit, since he would have been intending to follow that trajectory and sell about now, then wait for the previously predicted drop to 750 in 2010 (which has now already occurred) to buy it back. So I assume he's actually deploying a fairly small amount of available spare cash into the market at this point.

I haven't corresponded with Mike, but in reading through various threads in the Fourth Turning Forum, he has always seemed like a fairly reasonable and intelligent guy. But otherwise extremely intelligent people (especially scientists and engineers) can do (and say, as can even be observed on this forum) the most idiotic things when it comes to dealing with personal money or discussing finance. Isaac Newton lost a fortune in the South Sea Bubble and lamented something to effect that he could calculate the motion of heavenly bodies, but not the madness of men. Recently, it was revealed through some of Einstein's personal letters that he lost most of his Nobel Prize money in bad bond investments.

[freddyv]

> Here is Mike Alexander's latest forecast.

> http://www.safehaven.com/article-11887.htm

As an investor I always try to keep a few basic rules in mind and one of those rules is to not get too wedded to predictions that are not coming true and to trade the market that is in front of you.

People who try to tell the stock market what to do are bound to lose at some point. On the other hand, letting the market tell you what it is likely to do based upon sound principles such as mean reversion is likely to keep you on the right investing path.

I am constantly amazed by the so-called experts who refuse to break out of their belief systems that they have built up over their lifetimes. I keep hearing these fools say, "...unless the world's coming to an end..." when in fact the world as they knew it has come to an end.

--Fred

[mark]

OK, here's my take:

Friday, 11/21, and Monday, 11/24, were two days in a strong countertrend rally.

When the rally is exhausted, (it may be already; by next week very probably), the main trend will resume, which is down.