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Despite the more headline-grabbing topics of Cisco and Chinese Internet stocks' declines over the last few sessions, I find it curious that not a lot of folks are concentrating on a more important "tell" for this market and for the economy. Specifically, no one seems to be looking at the economically sensitive sectors and the stocks that comprise them.

Pull up charts on Ford(F:NYSE) or General Motors(GM:NYSE), WalMart(WMT:NYSE), the Transports, Alcoa(AA:NYSE), 3M(MMM:NYSE), Morgan Stanley Cyclical index(CYC), the CRB index(CRB), gold or silver, or junk spreads. All are "harbingers" for the economy at large. All are getting hit pretty hard over the last two weeks. And all are more important to the health of this market going forward than is either Cisco Systems(CSCO:NASD) or

I know, I know: maybe they are consolidating their big gains from the last year +. Certainly possible, but let's keep a close eye on these issues over the next few weeks. After all, the transports topped exactly 8 months prior to the Dow in 2000. And given that stocks are the single best lead indicator of the future direction of the economy (and not Alan Greenspan as much of the Street would have you believe), it makes sense to keep these issues on the radar screen.

Forget about what Chambers says tonight (you already know the script anyway); watch the economically sensitive stocks.

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Position in CSCO

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