By Todd Harrison Dec 15, 2004 3:02 pm
May peace be with you!
Dear Mr. Fantasy play us a tune
Something to make us all feel happy.
Do anything to keep us out of this gloom
Sing a song, play guitar, make us happy
The afternoon fray is drifting away as players trade and the hedgies play. I rarely take a respite during the day (old habits are hard to break) but I made an exception today when uber-Minyan John Roque of Natexis Bleichroeder stopped by for fresh fish. There are certain folks that I have a deep respect for--Steve Galbraith, Jeff Saut, Steve Shobin and Michael Santoli (among others)--and John toes that very same line. And when Rick Schottenfeld saddled up to the table to join the 'fest, the feet went up and the wasabi went down!
There were a few things that we all agreed on. For one, the near-term is difficult to game as we straddle the line between momentum and complacency. With a few weeks left in a seasonally strong and very emotional environment, the bulls are pressing their luck by piling onto the pond. That may not matter but I can't emphasize enough how apt the Ice Capades analogy is. The backdrop doesn't dictate that we'll snap but it does suggest that a tiny crack can quickly crevice.
When we pulled back our time frame, Rick offered a vibe that resonated for a few reasons. He opined that we're edging into a new bull cycle that will be fueled by M&A and exacerbated by a weak dollar (as foreigners gobble up domestic equity). The way he figures, the next two years will be dominated by companies looking to put their cash to work. In lieu of organic growth, corporate America will attempt to attain critical mass via acquisition. He concluded that "bigger will be better" and, as an extension, big cap will outperform the small fries.
Mr. Roque, for his part, offered that he's finding more charts that are constructive rather than destructive. A consolidation wouldn't shock him (or Rick or myself) but patterns are finding resolution to the upside. He also noted that the bullish sentiment (new highs) is troublesome but there isn't synergy on bearish sentiment (new lows). That vibe was echoed by our own Jason Goepfert who, by this time, was conferenced into the makeshift Minyanfest.
I would love to continue the parrot impersonation but I'm already late for another midtown meld. I will humbly turn over the 'Ville to my fellow professors who assure me that they'll also keep close tabs on the Minyanville holiday auction. Six days until Festivus, my friends, and if you haven't picked up on it by now, it's not my style to do things half-baked. I can't vouch for the quality of content on Thursday (the day after) but you have my word that Wednesday night will be all that--and more!
Fare ye well into the bell and have a fantastic night.
No positions in stocks mentioned.
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