Steve Zito, MS Fin/BS Econ Wharton School, HTML Writers Guild
uses economic and technical analysis to forecast the direction of the stock market. The views in this newsletter are opinions only, and should not be relied upon as advice on investment decisions.
Nasdaq Sept.10 -Trading Tips -Sitemap -Stock Picks -Subscribe

NASDAQ COMPOSITE
INDEX closed 1527.80

Are We Close to the BOTTOM?
Thur., Sept. 20, 2001

******************Commentary*******************
Sept. 19 Go To Page 2 Nasdaq closed 1527.80 -27.28 on Wednesday. Robert Hormats, Vice Chairman of Goldman Sachs, appeared on CNN at midnight and described U.S. consumer confidence as WEAK, with unemployment going up, but saw positive elements the government is doing right, quote, "taking the lock off the Social Security lockbox." When asked why Greenspan urged caution today (Alan believes that markets may turn up in a couple of weeks), Hormats said investors are suffering from "irrational pessimism" and sees government doing the right things. Actually what government is doing is reacting to events. U.S. leadership was blind. Investor pessimism is not irrational. What will government do militarily? Who knows? We are all scared to death of additional terrorism, Afghanistan could be another 10-yr. Vietnam, Broadway shows are closing down and Dick Grasso (CEO-NYSE) is congratulating himself daily on CNBC. Hormats said we NEED more tax cuts. People without jobs pay no taxes, Mr. Hormats. Hormats said we are not in a war between the West and Islam. When he sits down to a $300 lunch with Goldman's Abby Joseph Cohen, does he discuss extensive damage his analysts have caused to small investors with ridiculous target prices for Internet stocks (AMAZON.com) last year? When Nasdaq rallied sharply in April-May, Goldman Sachs analysts downgraded key stocks like SUN Micro. Since May 29, the Goldman Sachs analyst Laura Conigliaro caused Sun Micro to fall 57% to $9.00. These pompous stuffed shirts have been doing it to the public since the founding of capitalism. Wall Street brokers became unimaginably wealthy on the Initial Public Offerings of Internet firms over the past 3 years. When we sued, high-priced lawyers for Wall Street firms would drive legal costs sky-high. Hormats ended his TV spot by stating the airline industry must be SAVED by government for national security. Not to mention his rich friends who are CEO's at airlines, an industry whose CEO's received $120 million a year in salary and benefits. Not one Airline CEO volunteered to take a pay cut. -Technical Analysis. On 10-day chart, Nasdaq closed (1.31%) above moving average (MA) support. Nasdaq fell from 1605 where it opened on Monday to 1446 at Wednesday's low (-14.8%) in just 3 days. Up 82 points last hour Wed. RSI and MACD negative, stochastics rising but neutral at 55%/30%. Expect a return to panic selling by mutual funds trying to raise cash for redemptions. Easy to tell redemptions are increasing, Fidelity is dusting off Peter Lynch for TV ads. No rebound is forecast due to President Bush's speech. Nasdaq is declining due more to a loss of confidence in leadership than fear of recession. If stocks crash, and middle income investors are told repeatedly it is unpatriotic to SELL, then HOLD, stocks will have no capital gains, they will pay NO taxes. Is that patriotic? How to Use SITE. Peaceful CANADIAN STOCKS.
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