ARE YOU A "NEWMAN" FAMILY

i make a habit of reading an investment outlook monthly newsletter written by pimco's bill gross. for those of you who aren't familiar with mr. gross, he is the largest bond fund manager in the world. and for full disclosure purposes, mr. gross was the crazy who predicted, and i think still predicts, that the dow will go down to 5,000. actually, in an interview after he wrote his piece called "dow 5000", he hedged a bit and said that 6,000 would be a better target but 5,000 was possible. now you might think that a bond guy saying nasty things about the stock market is just sour grapes. for what its worth, he also called the top of the long bond rally we experienced over the past few years and that could have exacerbated the recent swings in the bond market and caused losses in some of the funds he manages.

with that being said, he has been fairly downbeat on the prospects for the US economy going forward. in fact, as i have mentioned, he is calling for a huge decline in equity valuations based primarily on the fact that he believes equities are way overvalued based on all sorts of methodologies. instead of boring you with numbers and graphs, his most recent piece is one the best i have read. i highly recommend reading it and digesting the full gravity of his scenario and susequent thesis of what may or may not happen to our country and all of us who are fortunate enough to live here.

you can read it at www.pimco.com. hopefully you are not a newman. but, if his analysis of what the current state of our country, or its mainstream middle class families, is even a little bit correct, dow 6,000 or for that matter 5,000 may be optimistic.

have a grateful day!

larry