The last two days have been a little tough, as Greenspan's Humphrey Hawkins review with Congress took it's toll. I think he was just trying to scare the market, as he did previously with his memorable "irrational exuberance" remark. That remark temporarily scared the crap out of the market, which has since gone on to gain several thousand points. I don't think his current negative outlook is anything more than made to order for stock market consumption.

No doubt Greenspan, like many other market observers including yours truly, thinks some of these stock run-up's like the Internets is very unhealthy. This is his way of temporarily taking away the punchbowl at the bull market party. The Fed meets next on August 18, and I don't expect an interest rate hike to come out of this meeting, because of the negative impact it would have both here and abroad.

I suggest you view this as an opportunity to acquire those stocks that have been on your shopping list, but have been "too expensive". You're only going to buy them at a "good" price when the market is pessimistic, and this is it. No one can say if this market gloom will last one week or one day. You just have to trust your instincts, because your guess is as good as that highly paid analyst's. Of course it is, as you will hear the experts make very different predictions about which way the market will go.

I will wait until I see some sideways movement, and if I see some strength after that, then I'll go shopping. Unfortunately, the market may come out of this in a "V" formation, which is a tough rocket to try to jump aboard. Whatever you do, be it sit tight or buy in, be decisive. An indecisive approach will only make you the perennial bridesmaid. Hey - it takes guts to be a successful stock market investor. Stay tuned.

The Market Pro - July 22, 1998