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October 2003 Volume 3 Issue 13

THE NEXT GREAT BULL MARKET 2007 to 2009

"They say you never grow poor taking profits. No, you don't.. But neither do you grow rich taking a four-point profit in a bull market."
Edwin Lefevre interviewing legendary trader Jesse Livermore Reminiscences Of A Stock Operator, 1923

Every two weeks, the "Fallen Angels S-O-S (Stocks To Watch)" focus list profiles several great companies whose shares are trading at half or less of intrinsic value, based on our research. This issue's S-O-S include the worst and best performing issues in four sectors. This "worst & first" approach is intended to provide us two kinds of opportunities.

The "worst" referring to a stock that remains very much out of favor, yet cheap. With a reasonable timeframe and patience, we anticipate better times ahead for the stock. And we include the "first" or best perfuming stock in the same sector which also meets our rigorous standards for a company which is both cheap and timely. These best of breed opportunities we refer to as CATS, or Cheap And Timely Stocks.

WORST AND FIRST

By combining the "worst" i.e. laggard, with the "first" you're like the farmer who plants a diversified variety of crops. He knows that some will come to a profitable harvest sooner than others. And like the farmer, our portfolios require careful weeding (cut your losses), harvesting (profit taking), soil testing (market analysis), and crop rotation (anticipating business cycles).

A NEW BULL MARKET?!

Before we profile this issue's Stocks To Watch, I want to call your attention to an interview I did with economist Harry S. Dent Jr. for the radio network which carries my weekday show (4pm to 5pm PST, 7p to 8p EST). The program was broadcast on 9-25-06 and is currently archived at www.businesstalkradio.net in case you wish to hear it. You might recall Dent's first book, The Great Boom Ahead, published in 1992. He correctly anticipated and forecast the tremendous market boom of the late 1990's. For your convenience, the show also streams live on the internet and can be heard by going to www.gabrielwisdom.com

Harry Dent's forecasts are based on the science of demographics, and it's very simple and understandable for any of us who have been around awhile, observing how people change as they age. Basically, the economy and markets are influenced by the spending habits of the largest generation or population in a nation. In the U.S., the largest demographic are the baby boomers, the post World War Two baby's born from 1945 to 1963. Economic booms and busts have occurred with relative frequency throughout history, and Dent's research suggests that when the largest populations in history turned 60 plus, they began shifting from growth oriented investments to those that can generate income. And as a general rule, older people no longer want large homes, debts, and speculative investments.

The largest generation of our time will be turning 60 plus beginning in 2010, and it could initiate a long period of deflation, especially for investments that are expensive to maintain or that do not pay dividends, etc. Meanwhile, the majority of baby boomers are desperate to grow their nest eggs over the next few years...creating a huge new bull market that is just beginning now, similar to what we experienced (and enjoyed) during the late 1990's. Here our this issue's Stocks On Sale.

FALLEN ANGELS S-O-S (STOCKS ON SALE)... WORST AND FIRST

Yahoo (YHOO) at $24.42 Google (GOOG) at $427.30
Aegon Insurance (AEG) at $18.62 Prudential (PRU) at $77.79
Wal Mart (WMT) at $48.46 Costco (COST) at $53.20
Ford (F) at $8.17 Toyota (TM) at $116.20


Gabriel Wisdom and Michael Moore manage two no-load mutual funds, the FALLEN ANGELS VALUE FUND and the FALLEN ANGELS INCOME FUND.
If you would like more information, please call American Money Management, LLC at (888) 999-1395 today. A prospectus is available at www.amminvest.com

Please carefully consider each fund’s objectives, risks, charges and expenses before investing. The prospectus contains this and other important information. Please read the prospectus carefully before you invest. To obtain a prospectus, please call American Money Management Funds at (888) 999-1395. Mutual fund investing involves risk, including possible loss of principal.

About American Money Management, LLC

American Money Management, LLC, an SEC Registered Investment Adviser, manages accounts for individuals, companies, trusts and retirement plans. Minimum account size is $100,000 but investors are invited to try a managed account with as little as $25,000 (AMM reserves the right to withdraw this option at any time). For more information on our managed accounts program, please call us at 888-999-1395 or visit us on the web at www.amminvest.com.

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Disclaimer
The opinions expressed are those of Gabriel Wisdom and Michael Moore and do not necessarily reflect the opinions of American Money Management, LLC (AMM), an SEC registered investment advisor who serves as portfolio manager to private accounts as well as to mutual funds. Clients of AMM, Mr. Wisdom, Mr. Moore, employees of AMM, and mutual funds AMM manages may buy or sell investments mentioned without prior notice. This newsletter should not be considered investment advice. The opinions expressed do not constitute a recommendation to buy or sell securities. Investing involves risks, and you should consult your own investment advisor, attorney, or accountant before investing in anything. Current stock quotes are obtained at http://finance.yahoo.com. Prices are as of the close of the market on the previous day of trading.

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