Overheard On The Street
Here’s what they’re saying at mid-day:
Frank Gretz, Market Analyst, Shields
& Co.: “Everyone is looking for the low in tech. Everyone wants to buy
tech, mind you, while there’s still money to be made elsewhere. Tech is down a
lot and could rally anytime, at least temporarily. But if you want a sobering
thought, think about what a good low really looks like. A major low looks like
the low last March in Old Economy stocks. Remember last March? Value managers
were dying – – value funds had redemptions, Tiger Fund went out of business. You
were a fool to be buying a food or even a drug stock. Old Economy stocks were so
out of favor that everyone sold them and that, by definition, is what happens at
a major low. When will tech bottom? As much as tech has declined, they’re not
laughing at Cisco yet.”
John Roque, Vice President, Arnhold and
S. Bleichroeder: “Tech is still horrible. We were amazed at the number of
‘I’m sticking with tech as my favorite sector’ guests that appeared on CNBC over
the last few weeks. They may be good businesses, but the stocks are horrible.
The inability of these investors to give up on tech, and the fact that most
chart patterns in tech are the equivalent of the New York Rangers, tells us that
rallies in the tech sector should still be sold. Nasdaq will retest the Dec.21
low of 2288.16.
Paul Rabbitt, President,
RabbittAnalytics.com: “The evidence of an economic slowdown is beginning to
get overwhelming. The Fed has officially changed its approach from a focus on
fighting inflation to a focus on preventing recession. The Fed could very well
take out an ‘insurance policy’ and cut between 25 and 50 basis points when it
meets January 30. Earnings are crashing, valuations, while improved, are still
not compelling. However, the market is very good at looking across the valley’
to better times and ignoring older bad news.”