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Show Sunday. February 23, 1986 The Salt Lake Tribune. F9 Dow Topping 2,000 by July? Bullish Forecast Bears Watching Hows this for bold forecasting? The explosive Dow will top 2,000, maybe even reach 2,500, by July 1. The price of gold (around $340 an ounce at press time) will collapse, breaking below $300 and possibly tumbling to $200 before year-enThat's the blunt talk I get from Robert Prechter Jr., one of the hottest hands in calling the stock and gold markets in recent years. Prechter, 36, is the publisher of the Elliott Wave Theorist of Gainesville, Ga., a monthly investment letter with about 8,000 subscribers. He s also the leading proponent of a view the Elliott Wave theory holding that all market activity (up or down) is based on mass psychology rather than political or economic events. The theory was developed in the late 1930s by accountant Ralph Nelson Elliott. In brief, so it goes, there are five waves (or steps) to a bull market up, down, up, down and then up (the last being the final thrust of the bullish cycle). Each de- - Dan Dorfman cline (or correction) is said to ultimately lead to an advance thatll take the market to a higher level. I rang up Prechter the other day when word made the rounds in Wall Street that he had suddenly gone Just How Big Is National Debt? NEW YORK (UPI) - The enormityto of the national debt, expected reach $2 trillion by next fall, is easier to grasp if you consider it will approximate all the wages paid to Americans in 1985 and be about equal to all the cash in the United States today, researchers at the Emhart Corp. report. In addition, the multinational man ufacturing companys experts said that counting $2 trillion by pennies, at the rate of one per second every minute of every day, would take 63,419 years. For contrast, they added that in 1981 the United States had a $1 trillion national debt and if the next five years repeat the past five, we will have a $4 trillion debt in 1991. from bull to bear on the stock market. The rumors, it turned out, were all wet. "Its chilly here, Prechter told me, referring to hometown Gainesville. "We might even see some snow. But Im not looking for any snowfall in the market." If anything, Prechter is even more bullish now. However, he is looking for a slight market sell-of- f in March, something around 50 Dow points. "It a should be a short, sharp decline minor shakeout led by some profit-takinsays Prechter. And then its on and up again. Prechter expects April to be an especially explosive month, with the Dow climbing several hundred points. Given his exuberant outlook, some might consider Prechters forecasts to be blue-skHowever, based on his record, he should not be viewed or looked upon as some wild-eye- d optimist. Back in August of 82, with the Dow around 525 and bearish sentiment abounding, Prechter turned bullish. He maintained that posture through a market rise of more than 400 points. It wasn't until January of '84 with the Dow at around 1,250 that he crawled back into the bearish camp. His timing was super, as the Dow then proceeded to drop to 1,100 in June 1984. At that point, he reversed himself and hes been bullish ever since. Thats pretty snazzy market calling. In fact, in a poll taken last Sept. 17, just one day before the Dow touched a low during the session of 1,283, Prechter was the only one of 140 market pros, including money managers, investment advisors and newsletter writers, to be both bullish and advocating a 100 percent invested position. What makes him particularly newsworthy at this point is his ebullient expectations for the short-run- , notably that huge gain of from 350 to 850 points in the next 44 months. A potential 2,500 Dow by July 1 is a totally iconoclastic view. By and large. Wall Streets bullish fraternity has been talking of a Dow peak this year, with some holding out the possibility of 2,000. Prechter, though, argues the market is much more powerful than generally thought despite its already huge rise. "We're still in the middle stages of the five waves and that 1,700-1,80- 0 front). And they're all diversified, limiting the risk in the event a particular market sector turns sour. The favored funds are Guardian Mutual Fund, Lehman Capital Fund, Manhattan Fund, Partners Fund (all New York); Fidelity Puritan Fund (Boston); Stein, Roe Special Fund (Chicago), Janus Fund (Denver) and W L. Morgan Growth Fund (Valley Forge, Pa ). means weve still got a long way up," he says. Prechter related the five waves to the current bull market. Wave one: The run up in the Dow from 770 in August of '82 to 1,290 in January of '84 Wave two: A decline from 1,290 to 1,090 by July of '84 Wave three: The current wave Prechter's forecast of topping 2,000. Wave four: A big drop of perhaps 300 to 400 points (no timetable was cited). Wave five: A massive rebound in the Dow to 3,600 Prechter also has used the Elliott Wave Theory to call the trends in gold prices. And here again, he has to 3,700 by 88 demonstrated excellent prowess. For example, in January 1983 he predicted gold would soon top out at just above $500 an ounce. It hit $511 on Feb. 15 and within the following two weeks fell to $408. Gold, he tells me, started its first wave of the bull market in 1957 at $35 an ounce and completed its fifth wave in January 1980 at $870. Its now in a severe bear market, he says. The rest of the year will be down and periodic rallies should be ignored because they'll be temporary, at best, he adds. His forecast: A skidding price tag of $105 an ounce by 1988. In a nutshell, says Prechter, "the best is yet to come. Prechter doesn't recommend stock groups or individual stocks. However, given his rosy market outlook, he thinks eight mutual funds make sense. Each has a good track record during the past five years and the past 10 years. What's more, during the past year, each was in the top 25 performpercent of all mutual-funers. Further, all offer telephone switch privileges in the event an investor gets worried about the market and wants to switch into a money-markfund for a while. Theyre all funds (no big sales fees up d News America Syndicate d Knmxnmita QIMIElGfMKSIM) New Januaiy 86 - 2nd Edition Question: Utah Publicity Source Book What material can form a wire 50 miles long from a single ounce, is found in the human body, and can be an insurance vehicle for a diversified investment portfolio? Completely Updated! More Listings! The second edition of this comprehensive directory of Utah media and community sources will be available January 20, 1986. This loose-leae booklet is a must f for communicators. It contains complete detail on all Utah printeledronic media, wire services, stringers & bureaus, school media, interview programming (80 programs listed statewide), Utahs Congressional Delegation & Legidature roster, Utah State Chambers of Commerce, clubs and associations and the Utah Travel Councils 1986 Calendar of Events. New Listings Include: sports, political, feature and assignment editors for print media circulation totals community distribution PR & program officers for clubs &. associations where available Hard cover binder and updated contents $80. Updated inserts without cover - $55. Answer: Cold! An investment today in yold acts as a form oj portfolio insurance, helping to maintain your purchasing potter in tie years ttbead and providing prudent portfolio diversification. 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