Wednesday, October 24, 2007
In an unprecedented move, “The Fly” has ordered an extra shiny trophy, made in China (lots of lead involved in production), to be delivered to a man named “Tom Au,” who is well deserving of this weeks “Asshat of the Week award.”
This man just took out his calculator and declared the DOW will go to 6,000.
But valuations since 1991 (like the 1920s) have reflected a “new world order” of American political dominance that is now being eroded by troubles in the Middle East and elsewhere, and a highly leveraged “new economy” that is looking flimsier by the day. By calling for stocks to return to prewar valuations, I’m stating my belief that the elevated profit margins, returns on equity and earnings growth of the past 15 years that supported recent valuations were a historical aberration, and that a decade (or more) of U.S. stock market progress is about to be wiped out.
Now that’s the type of market call “The Fly” respects, yet throws mashed potatoes at.
Fuck the bears who call for the average 10-20% dip. Tom Au is showing you, via elementary mathematical models, how the DOW can ‘shave off’ 55% of its value, in fairly short order.
What a wonderful world of silliness Mr. Tom Au lives in.Comments »