NEIL: ALL RIGHT.
NOW AMONG THE FUNDAMENTAL
REASONS GIVEN FOR THE SELLOFF IN
THE STOCK MARKET TODAY IS APPLE
GETTING, YOU KNOW, BLUDGEONED
OVER THE IDEA MAYBE IT IS NOT
LOOKING AT A ROBUST HOLIDAY
SALES SEASON AS EARLIER THOUGHT
THE CASE.
ONE OF ITS KEY SUPPLIERS DOWN
20% DEMAND MIGHT NOT BE THERE
PARTICULARLY FOR THE NEW
IPHONES.
THERE IS NO WAY TO QUANTIFY THAT
UNTIL WE'RE KNEE DEEP IN THE
MIDDLE OF THE SELLING SEASON.
TECHNICIANS LOOK AT0O,!
THINGS
WHAT FUNDAMENTALLY MIGHT BE
HAPPENING, AMONG THE BEST IN THE
BUSINESS, STOCK MARKET CYCLES
EDITOR AND PUBLISHER A NOTE THE
BEAR.
WE TALK TO BULLS.
WE TALK TO BEARS.
PETER IS ONE OF THE BIGGEST IN
THE LATTER CAMP.
GOOD TO SEE YOU, MY FRIEND.
>> HOW ARE YOU DOING, NEIL?
I AM GETTING THE FEELING I GET
CALLED IN ON BIG MARKET DOWN
DAYS AS NEUROPHYSIOLOGIST OR A
PLUMBER TO FIX THE LEAK WHICH I
CAN'T DAY.
NEIL: WE HAVE TRY TO MIX
OPINIONS IN THE MARKET.
WE TRY TO BALANCE THAT HOW THE.
>> ABSOLUTELY.
NEIL: WHAT HAVE BEEN YOUR CHIEF
WORRIES GOING IN, EVEN PAST
TODAY?
>> WELL, USUALLY BOILS DOWN TO
TECHNICAL THINGS, NEIL.
YOU WILL RECALL, I WAS, I LOOK
BACK OVER THE LAST YEAR OR SO
WHERE YOU AND I HAVE SPOKEN.
IT WAS ALMOST EXACTLY A YEAR AGO
I PRESENTED YOU MY SIGN OF THE
BEAR.
THAT SIGN OF THE BEAR SAID THAT
WE WEREç WITHIN, WITHIN 8 TO 10
WEEKS AT THE MOST OF AN
IMPORTANT MARKET TOP.
LO AND BEHOLD.
JANUARY 26th THERE WAS A
VERY IMPORTANT TOP IN THE
MARKET.
SOME PEOPLE MIGHT ARGUE THAT THE
S&P AND THE DOW HAVE GONE TO
MARGINAL NEW HIGHS BEYOND THAT,
BUT MOST IMPORTANT INDEX IS THE
NEW YORK STOCK EXCHANGE
COMPOSITE INDEX.
NOT ONLY THAT HAS NOT GONE ABOVE
THE JANUARY HIGH, BUT NOW HAS A
SERIES OF LOWER HIGHS AND LOWER
LOWS.
THAT IS THE DEFINITION OF A BEAR
MARKET.
NEIL: WHY DO YOU FOLLOW THAT
NYSE DEVELOPMENT IF OTHER
MARKETS DON'T NECESSARILY
CONFIRM IT OR ARE THEY BEGINNING
TO?
>> YOU'RE ALWAYS GOING TO GET
DIFFICULT INDEXES DO DIFFERENT
THINGS ESPECIALLY AT MARKET TOPS
BUT I MAINTAIN THE NEW YORK
COMPOSITE, NEW YORK
STOCK EXCHANGE COMPOSITE INDEX
IS MOST IMPORTANT ONE, CONTAINS
ALL THE COMMON STOCKS ON NEW
YORK STOCK EXCHANGE.
THIS TELLS YOU WHAT THE GREAT
DEAL STOCKS.
NOW TECHNOLOGY STOCKS ARE OFF ON
THEIRç OWN.
FINANCIAL STOCKS ARE OFF THEIR
OWN.
WE HAVE TO PAY ATTENTION TO ALL
OF THEM.
USUALLY AT MAJOR MARKET TOPS I
BELIEVE WE'RE FORMING, YOU SEE
KIND STAFFINGERRING WHERE ONE
WILL HIT A HIGH HERE, ONE A
COUPLE OF MONTHS LATER.
WE SEE SOMETHING LIKE THAT
HAPPEN, NEIL.
NEIL: YEAH.
I'M LOOKING AT APPLE VERY MUCH
CLOSE TO BEAR MARKET TERRITORY,
A HOST OF OTHER TECHNOLOGY
STOCKS WELL IN IT.
I THINK A THIRD, CLOSE HALF OF
S&P 500 STOCKS SIMILARLY SELLING
OFF.
PLAY IT OUT FOR ME THEN.
WHAT DO YOU SEE HAPPENING?
>> TWO VERY MUCH OPPOSING FORCES
ARE HAPPENING RIGHT NOW.
TURNS OUT ON SEASONALITY BASIS
WHICH WE LOOK AT AS TECHNICIANS
THIS PERIOD FROM OCTOBER OF THE
MIDTERM PRESIDENTIAL ELECTION
THROUGH JUNE OF NEXT YEAR IS THE
MOST FAVORABLE PERIOD WITHIN THE
FOUR-YEAR PRESIDENTIAL ELECTION.
SO THE MARKET HAS THAT WORKING
IN ITS FAVOR.
DOES THAT GUARRANTY AN UP MARKET
OVER THAT TIME?
OF COURSE NOT.
BUT IT DOES TELL US THAT IF
YOU'RE GOING TO BEç BEARISH YOU
BEST PERHAPS BE CAREFUL OVER THE
NEXT EIGHT OR NINE MONTHS
BECAUSE IT IS THE MOST FAVORABLE
TIME PERIOD WITHIN THIS
FOUR-YEAR PRESIDENTIAL CYCLE
THAT WE LOOK AT IN TERMS OF
LONGER TERM MARKET MOVES.
NOW ON OTHER SIDE OF THAT, WE'RE
SAYING WHAT I CONSIDER AN, A LOT
OF GOOD VALUE PEOPLE CONSIDER TO
BE THE MOST OVERVALUED MARKET IN
HISTORY.
SOMETIMES THE SEASONALITY CANNOT
OVERCOME THESE BEAR MARKET
FORCES THAT ARE WORKING.
ONE THING TO BE AWARE OF, NEIL,
THERE HAS BEEN A VERY IMPORTANT
20 YEAR CYCLE IN THE MARKET,
THAT MARKED REALLY IMPORTANT
MARKET BOTTOMS.
1942, 1962, 1982.
'82 BY THE WAY IS THE LAST TIME
STOCKS WERE TRULY UNDERVALUED.
P-E RATIOS UNDER SIX.
DIVIDEND YIELDS OVER SIX.
1982, 2002, ADD 20 TO THAT WE'RE
MAKING IT 2022.ç
I'M NOT MAKING THAT PREDICTION