Post of the Day
July 29, 1998

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Subject: Is that so, Mr. Biggs?
Author: KWBeckers

So there you have it. We are about to enter a Bear Market. How do I know ? Well Mr. Biggs himself has pronounced such ! Who is Mr. Biggs ? A financial guru who works for Morgan Stanley. What reasons does he cite ? Asian problems, earnings problems, world wide slowdown. All very good reasons. But have we not heard this before somewhere ?

In fact, I have been hearing this from the financial media since October 27th 1997, when suddenly everyone just KNEW this was going to happen. How on earth can you tell when a bear market is going to start ? I am the first to acknowledge I am not very good at predicting the market. The most money I have made was with the old Foolish buy-good-companies-and-hold-em theory. One of my portfolios is what I call 'Tech Kings' (as opposed to Cash Kings) : AOL, CPQ, CSCO, DELL, EMC, INTC, LU and MSFT - each a giant in its own field. This portfolio is up an astonishing 94 % since Jan 1st as of this moment. Part of my IRA is the monthly Relative Strength portolio - up a market crushing 84% ytd. A good thing I didn't listen to the Doom and Gloomers back in October. And I don't intend to listen to them now ! What about : Low interest rates, US Economy still ok, baby boomer retirement savings - where else are they to put their money - Asian problems - where else are they going to invest but the US stock market etc. etc. !

I conceed it is entirely possible for the market to correct, go sideways or go up from here on for the next few months. I don't know. Neither does Mr. Biggs. Nor anyone. Perhaps he sold out and is trying to talk the market into justifying his position ? No - surely the wise are not that cynical ?�. Only Fools pre-announce their intentions !

  "I conceed it is entirely possible for the market to correct, go sideways or go up from here on for the next few months. I don't know. Neither does Mr. Biggs. Nor anyone."

Here is a story of a monk which any Fool might take to heart :

One day, a Fool met a monk and was instantly enchanted. He donated a portfolio of Cash King stocks to the monk and explained the benefits of Foolish investing. The monk listened attentively and said :

"Is that so?" - and carried on his life of meditation and service.

Several years passed, when some smoothly dressed wise men from Wall Street finally tracked the monk down, and tried to explain to him the imminent threat of a bear market, and the benefit of selling his portfolio through their brokerage firm to wait for better times.

"Is that so?" asked the monk - and ignored them, carrying on his life of meditation and service, his mind at peace.

Several more years passed, and lo and behold, these same fellows, a little balder and greyer, and looking generally much the worse for wear and tear, visited the monk once again, to persuade him good times were around the corner, and why shouldn't he put his stocks into their brokerage firm - they could match the funds $ for $ and allow him to double his portfolio on margin.

"Is that so?" asked the monk - ignored them and went about his business.

Many years later, the Fool visited the monk again - who was at last ready to move on to another world, and told him he was a very wealthy man indeed.

"Is that so?" said the monk and bequeathed his entire portfolio to his monastry which was able to flourish off part of the annual gains for a long time after.

A bear market Mr. Biggs? Is that so?

KWB.


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