Bill-

Please grant me permission to archive this article here for maybe six months to a year for eventual comparison, good or bad. on the Market's trend at that time.

Every financial columnist has her/his opinion on the future direction of this economy; however, this article caught my attention because it's a bit off-beat.

"What Recent Losses Probably Don't Mean
Rather Than Signaling Recession, They're More Likely to Be an Overreaction

By Chet Currier
Bloomberg News

Don't take that tranquilizer; put away those sleeping pills.
There's a better, safer way for long-term investors to calm their jangled nerves after the recent drop in the stock and commodity markets. Sit in a comfortable chair and spend a few minutes studying the mutual-fund performance tables for any period longer than the past month or two.
The year-to-date column will suffice. According to Bloomberg data, the average return of more than 4,300 stock funds offered to U.S. investors was still a positive number as of June 16 -- 1.5 percent since the start of 2006. Over the past year, those funds have averaged a 10 percent gain.
For the past three years, the average return remains generous, at 14 percent a year. The five-year payoff is a more modest 5.9 percent annualized.
So what's all the howling about? Granted, it has been almost impossible not to be unsettled by a plunge of 5.5 percent in the average stock fund over the past month. Look at precious metals funds -- they're down 13 percent.
If you think as I do, you could tell yourself the markets are simply indulging in one of their periodic mood swings. Most of the recent losses merely erased gains recorded in a manic phase earlier in the year.
Easy come, easy go, right? Well, not quite. Veterans of the investing game might think that "hard come, easy go" is a more accurate description of what it's like trying to earn a worthwhile, consistent return from your money.
At times like this, an investor may fear that the markets sense some impending disaster that can't yet be discerned with the naked eye. Markets have a canary-in-the-coal-mine way of doing that.
Experience also attests, however, that they often overdo it. In the oft-quoted observation by economist Paul Samuelson, the stock market has predicted nine of the past five recessions. It looks highly likely that this time is one of those false alarms.
Inflation isn't suddenly accelerating. If it were, the first place to look for a signal would be the bond market, which is famous for its sensitivity to inflation signals. But the yield on the 10-year Treasury note is right about where it was when the stock market turned downward in early May.
If a recession is looming, it's news to almost every economist on the face of the earth. In the latest Bloomberg survey, none of the 67 economists polled forecasts a decline in output through the first quarter of next year. One among 65 sees a negative U.S. gross domestic product number in the second quarter next year.
Concerns persist that imbalances in the global economy between fast-growing nations such as China and the big-spender United States will sooner or later cause serious trouble.
This issue can't be ignored. But the modern world is never without threats to its stability and well-being, including war and terrorism, as well as economic perils. Investors who refuse to commit any money until the sky is cleared of these clouds are in for a long wait.
The most plausible explanation for the markets' gyrations in early 2006 casts it as an episode of speculation. Some markets -- notably gold, silver and other metals, as well as emerging-markets stocks -- embarked on a runaway rise as buyers chased after whatever was hot.
The advance abruptly reversed in May when it dawned on everybody that the Federal Reserve's campaign to raise short-term interest rates was threatening to poke a hole in this bubble at any moment.
Now fund owners who follow any sort of consistent year-in, year-out system of investing find themselves pretty close to where they began the year. If they have been busy with other life pursuits in the past several months and haven't been paying much attention to the daily doings of the markets, excuse them for surmising that not too much of any lasting significance has happened."

Thanks

oratier-

I want some of what that guy is smoking. That must be PURE.

All- I am looking at the spot gold chart. It is screaming "Move coming."

forgive me but i think there is a breed of complacency expressed in the bloomberg column which is alarming. this sort of complacency is disturbing wherever it is found whether it is in these financial markets or whether it is found in someone running a concrete company. if someone does not want to pay some attention to their money, the last place to "sock it away" is the stock market. much better, i think, to buy AAA yield and pray for the best.

Can anyone offer some tutelage to a novice as to why the utilities would show strength prior to 100% anticipated Fed rate hike? Is the rate hike priced in? Dead cat bounce? M&A Mania?

....and there it is. Down $5 now If this is the start of anything significant I would be surprised.

MarkM, mtzion,

Re I" want some of what that guy is smoking. That must be PURE."

Re: "forgive me but i think there is a breed of complacency expressed in the bloomberg column which is alarming."

My interest lies with the indulgence of the 67 economists Chet cites in the article. Are they going on or coming off an extended binge? Or is the lone contrarian economist correct?

BTW...the members of the Barron's Rountable, all active money managers, remain bullish on the remaining year's Market performance. For them to be otherwise would be a significant event!

RE: Barrons, Legg Mason, EK, GT

The price action on EK lately has been odd. Since I am short the stock I follow it regularly. While searching for possible answers about why this dog of a stock is showing strength; Low and behold, I ran across a post by Bill with a reader comment about some sell side shenanigans by Barron's and Legg & Co.

http://www.billcara.com/archives/2005/11/does_barrons_in.html

Barrons also pumped GT as undervalued around $15.50 in February this year.

http://www.siliconinvestor.com/readmsg.aspx?msgid=22132717

Today it sits at $10.76. So, I would take anything Barron's prints with a grain of salt or a metric tonne of skepticism. They clearly have bias in what they publish.

Can't wait to see how EK looks in early July.

Berkshire Hathaway (BRK -A/B) Is down almost 2% on the day. Now that Warren Buffet (with pal Bill Gates) is planning to go philanthropic, it appears that "investors" are speculating that:

a) Warren is retiring from Berkshire?

b) Warren is not retiring from Berkshire, just relinquishing day-to-day control to his yet to be recognized successor?

base metals strong today , Warehouse Stocks going down - anyone can see that at :

http://www.kitcometals.com