JASMTS

 

What’s Next?

The topping process is in place and in the near future we should see the conclusion to what has been described as the end to the “greatest bull market in history”.

In Jim’s own words, Let there be no doubt, this time is different, it is my contention that we are transitioning to a bear market- the first time I have indicated this since 1982.

This is the end of one of the greatest manias in history. We can look at previous manias to get a feel for how far it may fall. The Japanese market mania ended in 1989 and the Nikkei fell over 60% from 39,000 to approximately 15,000. The 1929 stock market went down more that 89% (Dow 41.22 from 381.17). The world is replete with examples of how manias have ended in other markets such as real estate and collectibles. A market will normally settle at least 40% from its high. Another important point is that once a market moves below its support level it almost always goes down below fair market value before again moving up. Using any of these comparisons it is fair to assume that this market will probably get close to the Dow 6000 level after it starts its final fall. It could just as easily penetrate that, going down until it reaches its next support level. It should be noted that after the 1929 crash the market recovered slightly then drifted lower for 3 more years before starting its 20-year recovery.

It is Jim’s contention that one of the finest buying opportunities in our lifetime will soon be upon us, both on the short and long side. In fact there are likely going to be several excellent opportunities over a more contracted period than has been in previous bear markets. It will be absolutely essential for the safety of your capital that you have a guide to navigate the turbulent waters that lie ahead.

Knowing what is and what is NOT an approaching crash! The indices making up the Model’s readings were quite different prior to the correction in the summer of 1998. The Model gave a Warning in advance, but never gave a signal that a crash was imminent. Although the Model gave a Sell signal over a year ago, it has not yet reached the point where a crash scenario is upon us.

At the time that critical mass is reached, Jim will advise subscribers on a special update. At that time those investors wishing to use leveraged instruments to profit from the crash, (they are not recommended for everyone), will be advised as to what he has purchased for his managed accounts. In 1987, clients realized an average gain of 6700% on their investments although 1 person, a barber, realized a $1 million return on a $10,000 investment. The S&P is so much higher in 2001 than it was in 1987, a drop of 25% would result in a much larger point loss. This could result in a much larger gain for investors using those instruments.

Past Performance Does Not Guarantee Future Results

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