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Teledyne Technologies Inc. Message Board

  • lahowell_34 lahowell_34 May 13, 2006 7:37 AM Flag

    What happened

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    • And Party like 1999! I'll take your comparison. Afterall history DOES repeat itself, ie... the fed is the fed is the fed....! I think we're already set up for a move up in stock prices-- starting this week--and taking us into July end. TDY should clearly be in the low $40s or high $30s--just to be in the 'gate' prior to 'lift-off'. Look at FSRV!!!

    • Fed Reserve rate increases are a very good sign for stocks.
      It is great that the economy is strong and the Fed agrees and raises rates. The period we are in right now is comparable to 1994 when the Fed had raised rates from 3.0% to 6.0%.

      The Nasdaq went from 700 to 1050 during 1994 & 1995 when rates were raised. Over the next 4 years, we saw one of the steepest climbs in the stock market ever.
      The Nasdaq followed
      1994 Nasdaq at 750 (fed funds rate was raised to from 3% to 6%)
      1995 at 1050 (fed funds rate was at 5-6%)
      1996 at 1300 (fed funds rate was at 5-6%
      1997 at 1600 (fed funds rate was at 5-6%)
      1998 at 2100 (fed funds rate was at 5-6%)
      1999 at 3900 (fed funds rate was at 5-6%) (a 400% rise while Fed funds rate was at 5-6%)

      The Fed only raises rates and keeps them up when it appears the market has potential to rise strongly. I wish they would have even more belief in the strength of the economy and move rates up faster to the 6% level like they did by the beginning of 1995.

      This time is somewhat different because earnings of S&P500 companies are going up in double digits (vs. prior year) for 16 quarters straight. That's 16 consecutive quarters with earnings rising > 10% (this is a rare event). Earnings have risen 68%, yet stocks have been stuck in a narrow trading range. The Dow has remained in a +/-8% range for 3 years! The Dow has barely moved since Sept 2003.

      Earnings are up 68% and stocks are building up rocket fuel as they have climbed only 10% in this period. The earnings strength continues as the S&P500 companies posted a 14% rises in earnings for Q1 �06, and they showed record earnings, reduced debt, and built record cash levels now > $670B cash (highest ever)! Stocks are a far better value now than at the beginning of 2006. Now the average S&P500 P/E is 13.9 -- this is significantly better than the long-term historical P/E of 15.0 from the past 53 years. Fundamentals are way too good to continue in this +/-8% Dow range forever! The climb in stocks is coming in 2006. We are overdue for at least a 50% climb. This will likely put the Dow over 16,000 near the end of 2006. The Nasdaq would easily exceed 3000.

    • Just it's turn to have the yahoo board glitvh-ha ha

107.00+0.45(+0.42%)Jul 2 4:00 PMEDT