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	Loaded for Bear   (February 27, 2006) Before you get too euphoric about the U.S. stock market and economy, read this interview in Barrons: Loaded for Bear. One of the key points in the piece is the "presidential cycle," a technical analysis mainstay for the past 50 years. The cycle is based on the simple observation that the stock market hits its low around the mid-point between presidential elections. As the accompanying chart shows, this pattern has repeated with remarkable consistency for the past 50 years. In recent history, it worked like this: Bush I elected 1988, recession late 1990. Clinton elected 1992, stock market low in 1994. Clinton re-elected 1996, Asian Contagion/Long Term Capital Managament meltdown, 1998. Bush II elected 2000, stock market bottomed October 2002. So look at the calendar, and count the days. Looks like a stock market bottom is looming around October 2006. And as the analyst in the article pointed out, the stock market has always been the leading indicator for recession. As the market goes, so goes the economy. * * * copyright © 2006 Charles Hugh Smith. All rights reserved in all media. I would be honored if you linked this wEssay to your site, or printed a copy for your own use. * * *
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