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Monday, May 8th 2006
"Secular vs Cyclical"
cont'd from page 1
......But, as I said, the whole market
has been turned on its head.
All the stocks that I've
described as this (Bull); man,
you can see that they're this
(Bear). And, how about all
those cyclical stocks (i.e.,
CAT (CATERPILLAR INC), smokestack stocks) that
I said were (Bear)? Oh,
man, you know where they are
(Bull).
If you want to try to make
money, you need to understand
the new order of things.
Why is the happening?
First, you've got to understand:
this is not a rotation, all
right? This is not some
musical chairs game.
When the economy heats up, money
flows out of the secular stocks
and into the cyclicals.
That's not what I'm talking
about right here; that's a
normal, natural thing.
What we're dealing with is
fundamental to the very
companies; it's not a sector
rotation. It's that
consistent co.s are now
inconsistent, and they're
driving us nuts. And the
inconsistent ones are becoming
rock solid!
See, CAT and DE (Bull for both)
- they're not levered to the
U.S. economy. They're
levered to BRIC (Brazil, Russia,
India and China), and to every
other developing country,
whether it be in Central Europe
or in Central Asia.
These countries - these
developing countries - they're
still in our 1920's.
They're still modernizing, and
to do that they need heavy
machinery. They need steel
- from the iron ore, to the
stainless - that comes out of ATI (ALLEGHENY TECH NEW).
Yeah,
stock of the year that I came to
you with 100% ago...."
cont'd
Lightning Round!!!
Apples & Oranges
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