John Makin, AEI

[Ken Hanly]

But wouldnt institutional investors and mutual funds take a more
conservative stance to investing. In fact in some cases woudnt they be
required to do so? Is there the same bubble in mutual funds indices?  As I
understand it NASDAQ was originally formed to facilitate trading in over the
counter stocks. The NASDAQ index no doubt contains most of the high-risk
knowledge economy and dot.com stocks. Werent they the locus of the
bubble--as indeed it was. The Dow JOnes would represent the older economy
and long established companies woudlnt it.? The bubble was a localised
bubble centred in the New Economy sector.

    Even the NASDAQ shows a doubling between the third quarter of 1996 and
the present. Over 5 years that is 20 percent a year, not exactly a disaster
for those who invested then. Of course that is no comfort for those who
invested at the peak and expected 2 and a half times that.

Cheers, Ken Hanly

P.S. Re Doyle's comments. I find many of the postings that are not directly
part of any discussion are useful. Things that Ian, Mark, Pugliese  Doug and
others post. I send them on to key people who again send them on to others
thus facilitating the spread of information significant to the left.
P.S.S. I havent read Wall Street as yet...What is waiting for me in Hell?

----- Original Message -----
From: Doug Henwood <dhenwood at panix.com>
To: <lbo-talk at lists.panix.com>
Sent: Saturday, July 14, 2001 8:53 AM
Subject: Re: John Makin, AEI


> Ken Hanly wrote:
>
> >         The market indices have levelled and no doubt for some of the
> >reasons that Makin gives. But as yet there does not seem to be any
> >disastrous downturn in market indices as a result of a peak being
reached.
> >The present indices are not all that far from the original peak.
> >ttp://quote.yahoo.com/q?s=^DJI&d=c&t=5y&l=on&z=b&q=l
>
> Forget the Dow - try the Nasdaq
> <http://finance.yahoo.com/q?s=^IXIC&d=c&t=5y&l=on&z=b&q=l>, one of
> the great bubbles in financial history, now burst. This is much more
> representative of first, the mass psychology, and second, the average
> individual investor's portfolio.
>
> Doug