(Page 2 of 14)
Larry, you’re making a big emotional mistake if you’re preparing your stock portfolio for the sell-off you anticipate. Most market followers are aware of the phenomenon of a major bottom during the year of a mid-term election. What caught us off guard this year was the expectation that June and July’s correction was the foreshadowing to that “major bottom” sometime in the second half.
As the market usually does the opposite of what the majority expect, it instead climbed that wall of worry right up until now. My boys at Dorsey-Wright and Associates pointed out a study that in every mid-term election year since 1955, if you bought the correction low (for 2006 so far July 18th 10,683 on the Dow) and held through the following year’s-end, you not only made greater than 20% every time, but the average gain was 42%.
If we do the average, that would suggest a Dow level of 15,170 for the end of 2007. The roughly 1,517 points we’ve gained since the July 18th low would be only a third of what’s to come.p>Of course Democrat-loving terrorists might throw a wrench in this scenario by deciding to pull another 9/11 between now and the end of the year potentially creating the “major bottom” below the aforementioned level, but don’t let some Pelosi-infatuated bull take your shares away before the meat of the rally! br> — William H. Stewart br> Boston, Massachusetts /p> p> Two years ago I wrote a quick note to Mr. Henry regarding the red-state blue state divide. While that stirred up more of a discussion than I expected, I have to say that while some colors have changed, I think Mr. Henry is spot-on with the unchanging day-to-day lives of most Christians and conservatives. While the Republicans are licking their wounds and gearing up for 2008, it might be good for the conservatives and the Christians to get back to the first principles. For the conservatives let us look back on American history and Western culture for our principles which truly motivated our fellow man. Where has the talk of liberty gone? Where is the pioneer spirit that gave people pride in making it on their own and a desire to reduce government? For the Christians, it might be good to shed our movement’s growing love of government. Have we forgotten that government’s growth is what motivated Christians to get more involved in the sixties and seventies? Maybe we should remember that Christians are to focus on eternity and that it is best to share our values and beliefs on our own with humility and generosity to our enemies, friends, neighbors, and family. Maybe I’m mistaken, but I don’t recall Jesus telling us to enlist the government, only to do as Lawrence Henry recommends: read the Bible, pray, and make our own world. br> — Devin Foley