leveraged buyouts and, 52
low interest rate effects on, 391
market cycles and, 35, 43, 214, 215, 327, 354–55, 363, 391, 407–8n.23
paper gains, 393
stock alternatives, 45, 59, 62, 114–15, 287, 297, 306, 339–40, 354, 367, 371–84, 391, 395, 396, 414–15n.35
for 21st century, 371–84
value of stockholdings vs. home equity, 430–31n.5
yield from, 114–15
See also interest rates; specific types
Investor Business Daily, 108, 167
investors. See fund managers; individual investors; institutional investors
IPOs, 24–25, 36, 37, 50, 183, 287, 325–26, 347–49
Morgan Stanley and, 99, 100, 348
Iraq war, 394
IRAs, 59, 105, 112, 469n.62
Irrational Exuberance (Shiller), 69, 423n.49
IRS, 125, 280, 352, 454n.19
Isaacson, Walter, 166
ITT, 414n.24
Japanese investors, 74, 191, 247, 281
Japanese market, 74, 191, 214–15, 248, 249, 263, 315, 355, 366, 367, 376
as investment potential, 396
Jarvis, Gail Marks, 337
JLF Asset Management, 231
job market, 392, 393, 394
John Hancock Financial Services, 165
Johnson, Abby, 95
Johnson, Ned, 66, 95, 229, 448n.40
Johnson & Johnson, 406n.18
journalists. See media J.P. Morgan, 276, 285, 425n.24
Juniper Communications, 196
Juniper Networks, 314
junk bonds, 52–53, 57, 62, 74–76, 84, 93, 94
Just for Feet Inc., 167–68
J. Walter Thompson, 43
Kadlec, Daniel, 402n.4
Kagel, Diane, 222
Kansas, Dave, 161–62, 170
Keegan, Paul, 440n.19 keiretsu groups, 281
Kelly, Fred, 108
Kelly, George, 24, 207, 224, 234
Kelly Haywood, 380
Keogh plan, 105, 469n.62
Kernen, Joe, 17, 155, 156, 158, 160–61, 289
Kerschner, Ed, 96, 120, 305, 313–14, 327, 342
Kessler, Andy, 348
Kessler, David, 144
Keynes, John Maynard, 108, 375
Kidder Peabody, 82
Kindleberger, Charles P., 59, 262–63, 304
Kodak, 41, 274–75, 425n.24
Komag, 204, 205
Komansky, David, 285, 350
Krach, Keith, 157
Kruep, Randall, 321
Krugman, Paul, 257
Kynikos Associates Ltd., 58
labor union pension plans, 104
Laderman, Jeffrey, 346
Lapper, Steve, 64, 65
large-cap stocks, 205, 208, 209–10, 214, 217, 224, 226, 234, 305
Latin America, 355, 357, 374
Lay, Kenneth, 90, 145–46, 157, 319
layoffs. See downsizing and layoffs LBOs.
See leveraged buyouts
Leader, Lennett, 196
Legg Mason Value Trust, 213
Lehman Brothers, 200, 208, 277, 285, 305, 327
Lenk, Edward (“Toby”), 319
Leonhardt, David, 426n.33
Leuthold, Steve, 41, 42, 63, 67, 277, 302, 354, 367, 406n.18
alternative investments and, 396
background and career, 70–71
independent research, 182
market forecasts, 69–70, 71, 315, 342, 391, 396
on price/earnings ratios, 210, 443n.20
Leuthold Group, 71, 378
leveraged buyouts, 51, 52, 54, 62, 74–77, 104, 183
Levin, Carl, 123–25, 130–43, 276, 343
Levitt, Arthur, Jr., 30–31, 124, 127–32, 135, 142–44, 272, 352
background, 128–29
Safe Harbor Provision and, 147–48
Levitt, Arthur, Sr., 128
Levy, David A., 273
Levy, Edwin, 36, 69–70, 92
Levy, Leon, 257, 283
Levy (Jerome) Forecasting Center, 271, 273–76, 345
Lewis, Michael, 241, 313, 344, 349, 350
Lieberman, Joseph, 87, 124, 131, 134–36, 142, 143
Liebling, A. J., 170
Lincoln, Abraham, 138
Lipin, Steve, 158, 159, 431–32n.19
Lipper, A. Michael, 187, 210, 218, 223, 231
Lipper Analytical Service, 41, 187, 218, 220, 221, 233, 443n.27
liquidity, 74, 77, 92, 95, 252, 322–24, 325, 362
Litton Industries, 40
Litvak, Neal, 114
loans. See debt; interest rates lobbyists, 123, 125, 127, 129, 130, 134, 141, 142, 146, 343
Long Term Capital Management, 281–87
long-term interest rates, 63, 94–95
long-term stock market returns, 356, 359, 361, 423n.49
dividends and, 379
price/earnings ratios as guides, 363–64
Lonski, John, 462n.36
Lott, Trent, 250
Louisiana-Pacific, 429n.42
Lowenstein, Roger, 38, 282, 285
LTCM. See Long Term Capital Management Lucent Technologies, 26, 28, 178, 287, 301, 302, 305, 314, 387, 404n.21
Lycos, 199
Lynch, Peter, 59, 65–66, 119, 224, 226, 412–13n.17
Cramer contrasted with, 167
stock pick philosophy, 187, 288–89, 297
Vinik’s results compared with, 231
Mack, John, 99
MacKay, Charles, 17, 32, 153
Madrick, Jeff, 159–60, 256
Magellan Fund, 59, 65–66, 104, 114, 224, 439n.32
Vinik and, 226–31, 308, 341
Maine, Douglas, 127
Mainstay Funds, 222
Main Street investors. See individual investors Malone, Michael, 115
Manias, Panics and Crashes (Kindleberger), 262–63, 304
manufacturing capacity, 258
Manyika, James, 257
Marcin, Robert, 224–25
margin calls, 336
margin requirement, 244, 251, 322, 460n.13
Mark, Reuben, 429n.42
market cycles, 3–16, 353–84, 390–91
as amoral, 15, 69
average annual real returns, 5
Buffett’s buying-at-bottom strategy and, 43–44
commodities (1937–99), 373
conventional wisdom vs., 191–92, 354
corrections in, 14–15, 69
Dow Theory analysis, 4–7, 370, 467n.36
duration of financial memory of, 12
expansion/contraction rhythm of, 14, 214
Farrell’s predictive acuity on, 39
financial media’s cursory treatment of, 163
global, 396
graph of (1882–2003), 2
human consequences of, 15, 16, 27–29
importance of understanding, 16, 69–70, 384
index funds, 209
individual investor indifference to, 391
inflation potential and, 383
intermissions in, 365
investment research, 186–89, 190
investment timing, 35, 43, 173–74, 214, 215, 230–31, 407–8n.23
investor’s long-term success, 189, 354, 356, 423n.49
investor’s relationship to, 13–16, 40, 45–47
knee-jerk reactions to, 4, 45, 69–70
mania ingredients, 262–63
momentum investing effects in, 211
1990s bull market’s blindness to, 163, 167
peak in 2000, xx, 324–26
probability-certainty confusion and, 283–85
psychological factors, 4, 6, 12, 15, 16, 246–47, 249, 283, 362–65, 430n.3
spread between bull and bear, 388
timing of short-and long-term, 9, 369–71
unpredictability and, 269, 284, 369
value investing and, 214, 215, 327, 354–55, 363
See also bear m
arket; bull market
Martin, Justin, 89, 323, 328, 418n.45
Maryland Public Television, 342
MAS Funds Value Portfolio, 224
Mason, Jackie, 8
Matthews Asian Funds, 221
Mauldin, John, 393
Mayer, Martin, 83, 93, 252, 286, 328, 329
McCain, John, 323, 343
McCracken, Edward, 429n.42
McDermott, John, 115
McDonald, Ian, 222
McDonald’s, 26, 406n.18
McDonough, William J., 285, 286
McGregor, Clyde, 22–23, 215, 217
McGuire, William, 145, 428n.42
MCI Communications, 127
MCI WorldCom, 107, 302, 305, 335
McKinsey Company, 256–57
McManus, Thomas, 245
media, 153, 154–92
advertising revenue from financial services, 170
Age of Noise and, 165–67
AOL’s marketing as, 199–200
bearish forecasts and, 11, 306–12, 326
crash of 1987 and, 67, 413–14n.24
on dot-com stocks, 26
financial analysis, 190
financial investigative reporting, 169–70, 200, 434–35n.48
as fueling Great Bull Market, 21, 29, 30, 32, 106, 119–20, 154, 155–61, 167–68, 190, 305
Great Bull Market aftermath and, 343, 345–46
gurus of, xvii, xviii, 9, 29, 68, 81–101, 240–43, 289–300, 304–10, 346
information flow, 175–76, 179–81, 189–92
real-time reporting, 161–65
scoop emphasis of, 163
upbeat stock-loss reports, 336–37
See also specific outlets
Media Matters (PBS program), 30
Medoff, James, 256
Meeker, Mary, 97–101, 290, 300, 325, 326, 341, 346
background, 97–98
Internet commitment, xviii, xxi–xxii, 97, 100–101, 198, 242, 296–97, 348–49, 398n.3, 455n.7
Melnick, Andrew, 398n.5
Mercer, William M., 130
Merck, 26, 41, 42, 277, 327, 406n.18, 429n.42
mergers and acquisitions, 51–53, 59, 110
brokerages and, 74, 76, 183, 246, 312–13
economic effects, 63, 73–74
of mutual funds, 221–22
reporters’ problems in covering, 158, 159
Meriwether, John, 282
Merlo, Harry, 429n.42
Merrill Lynch, 73, 98, 117, 287, 292, 295, 320
analyst star system, 29, 397n.3
bulls vs. bears at, 327
commission revenue, 295
corporate acquisitions by, 74
individual investor advice, 298–99
Internet banking shares, xix
LTCM bailout, 285
nonexercised stock options, 429n.42
Orange County bankruptcy, 20
as publicly traded corporation, 82, 334
Spitzer investigation of, xxi, 350–52, 398n.7
See also Blodget, Henry; Farrell, Bob
Meyer, Laurence, 251
Micron Technology, 182, 229, 259
Microsoft, 41, 106, 121, 137, 205, 210, 289, 296, 387
earning$stock options accounting, 425n.24
employee stock options, 278
nonexercised stock options, 277
stock performance, 259, 287, 301, 315, 327, 387
ubiquity in mutual funds, 302
Milken, Lowell, 75
Milken, Michael, 52, 57, 74–75, 76, 99, 319
millennial fears, 322–23
Miller, Bill, 213
Miller, Robert S., 274
Milunovich, Steve, 398n.3
Minnesota Mining & Manufacturing, 425n.24
Mirage Resorts, 125
Mitchell, Andrea, 249
momentum investing, 13, 21–22, 202, 203–16, 218, 234, 235, 244, 305, 307
Amazon.com shares and, 293, 294, 295
fund managers and, 301–3
in market of 2003–04, 390
technology stocks and, 324
value vs., 212–16, 228
Money (magazine), 108, 168, 305, 306
Moneyline (CNN program), 304, 306, 310
money managers. See fund managers money market funds, 59, 104, 114, 224, 306, 336, 414n.35
low interest rates and, 391
Montier, James, 425–26n.29
Morgan Stanley, 12–13, 24, 288
Cisco and, 207, 272–73
investment banking, 97–101, 348–49
investor losses (1974), 4
LTCM bailout, 285
as publicly traded corporation, 82
share gains, xix
Sunbeam and, 180
tax-deducted stock options, 276
See also Biggs, Barton; Meeker, Mary; Quattrone, Frank; Roach, Stephen; Wein, Byron
Morgan Stanley Cyclical Index, 315
Morgan Stanley Dean Witter, 285
Morgenson, Gretchen, 346
Morningstar, 15, 187, 216, 219, 220–22, 314, 389, 438–39n.31
mortgage rates, 95, 262, 329, 422n.36
refinanced balances, 393
“Motley Fool” website, 196–97
Motorola, 27, 206, 259, 277
Moyers, Bill, 352
Munger, Charlie, 353
municipal bonds, 38, 114, 287, 340, 357, 381
mutual funds, 114–21, 182, 184–89, 217–35
aggressive growth, 27–28, 36–37
asset gathering, 22–23, 215, 217–18, 235
banner years for, 95, 154, 204, 224
buy-and-hold mentality, 21–23, 27, 215, 218, 294
cash ratio in, 224, 475
crash of 1962 and, 36
crash of 1973 and, 41, 210
crash of 1987 and, 65–66, 67, 72–73, 414–15n.35
diversification, 301
Fidelity’s leadership, 65
fixed-income, 59
401(k) investments in, 23, 104, 185
Great Bull Market aftermath and, 345
hot funds, 24, 210–12, 302
hot stock picks for, 23–24, 209, 210, 301, 302
indexed, 20, 186, 187, 209
investments in 1960s, 40–41, 51
investments in 2004, 388, 389
investor expectations, 232–35
investor faith in, 211–12, 218
investor fast turnovers, 164
investor hold-ons, 15–16, 27–28, 414–15n.35, 476
investor losses, 333
investor turnovers, 164
lower interest rates and, 95
marketing of, 154, 218, 221, 222–23
median age of new investor, 114
media’s real–time reports of, 164