*** Bulls losing arrogance, if not yet confidence
*** Could the dollar be topping out?
*** Henry celebrates first Communion...and Colonel Harper
comes back to Montmorillon after 56 years...
*** Friday's market provided yet more evidence that the
thrill is indeed gone from U.S. stocks. The bull seems
exhausted. He struggles back towards his old highs...and
then just can't keep going. He's worn-out.
*** Investors haven't given up entirely, but they have
lost much of their arrogance. Next to go: their
confidence.
*** A few months ago, the Nasdaq was headed towards
5,000. Now it's said to be in a "trading range." What
exactly does that mean? It means commentators have no
idea of what is going on. They're just waiting -- as we
all are -- for the market's next move.
*** Who knows what this market will do? But it looks like
its getting ready for another major move down. Remember,
it has a long way to go to get back to its real trading
range. Stocks typically trade hands at about 12 times
earnings. By that measure, the Dow must fall to about
5,000. The Nasdaq...well, it's got an even bigger drop
ahead. Prices go higher than you expect...and then fall
more than you expect.
*** Friday, the Dow fell 150 points. The Nasdaq fell
almost the same amount -- 148 points, or 4.2%. The Nasdaq
fell nearly 4% for the entire week, too.
*** By contrast, Lynn Carpenter reports the "Fleet Street
Letter's" "10-stocks-for-10-years" portfolio" is easily
beating the market -- up 6% while the S&P dropped 4%."
And in a market that could churn buttermilk, the "Fleet
Street Letter" trader service "had some great triple-
digit hits during April." Not bad, considering all else. http://www.dailyreckoning.com
*** The Fed's Discount Rate is now over 6%. William
Fleckenstein of SiliconInvestor.com reports that the rate
has been over 6% on six previous occasions this century.
The market fell an average of 12% in the next three
months. It was down 11% over six months. And stocks were
down 17% nine months later.
*** Japan, Inc. seems to have gone out of business. The
Nikkei closed down to 16,480 on Friday. You may recall
that it was nearly 40,000 in 1989.
*** Gold rose slightly. Dan Ferris of "Real Asset
Investor" reports that you can now get a yield of 9% from
gold producer AngloGold. Dan compares that to the yield
on a 10-year Treasury note, at about 6.5%, and the real
return on U.S. stocks in the 20th century, at just below
5%. At 9%, he explains, you double your money every eight
years. See his free online report at http://www.dailyreckoning.com/specialreports/home_042600.cfm
*** Oil rose, too. And the trade deficit rose along with
it. The deficit is running at $1 billion per day.
*** Speaking of outrageous real estate deals, Ed Hyman
reports that apartments in Manhattan rose 33% in the last
12 months.
*** Could the dollar be topping out? The euro came back a
little on Friday. It appears unwilling to go much below
90 cents.
*** We had a very full weekend at Ouzilly. Col. Harper
was in town, more than a half-century after he crash-
landed near here in WWII. More below.
*** And Henry, age 9, celebrated his first Communion.
Elizabeth, ever eager to observe the polite niceties of
genteel society (of which I remain largely ignorant),
invited Pere Marchand over for an aperitif after the
service. The good priest drank so much whiskey I was
concerned for his safety.
*** I'm on my way back to the United States...rushing to
catch my plane...
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"It looks just the same as it did 56 years ago," said
Colonel Flamm Dee Harper, USAF (Ret.). "France is a
beautiful country...as beautiful now as I remember it.
Except you don't have to worry about running into a
German patrol around every bend in the road."
Col. Harper, a small, handsome man of 80 years, stood on
the hillside speaking into a microphone to a crowd of
about 200 people. At his right was a young lieutenant,
the USAF attache from Paris who served as his
interpreter. Further down the hill, a group of about a
dozen French officers were formed up into a square,
starched and grave...with enough gold braid to back a
currency.
On his left were two flags, hoisted on recently implanted
poles -- the Stars and Stripes and the French drapeau --
and a marching band of about 40 pieces, resplendent in
dark blue suits with white insignia. They were the
municipal band of little Montmorillon, the sous-
prefecture about 10 minutes away from my house.
Montmorillon was celebrating the return of Col. Harper,
an American pilot who crash-landed in this field in 1944.
In front of me, a blonde woman had tears in her eyes. She
looked as though she was about 55 years old. I did the
math twice to make sure -- she had to be at least 70.
"I want to thank Jacqueline Thomas, who saved my life,"
said Col. Harper.
For more than half a century, Jacqueline Thomas, who
stood before me, had wondered whatever happened to the
young flyer she found in her grandfather's vineyard in
1944. It was the vineyard, as much as Jacqueline, who
saved him.
Born in Albion, Idaho, Harper was 21 years old when
America entered WWII. Like so many pilots, he was
fascinated by machines and speed. And when a group of P-
38s flew over Utah in 1943, Harper saw them and knew what
he wanted to do. He enlisted in the air force and was
sent to flight school. A few months later, he was already
flying his 29th mission over France. His target was the
German ammunition depot at Sillars, about 20 miles from
here.
But something went wrong. A time-delay bomb went off and
ignited the powder magazine just as he was passing
overhead -- at an altitude of only a hundred feet. The
debris hit the aircraft, putting one engine out of action
and damaging the other. Worse, Harper had been struck in
the head by flying glass. So much blood streamed down his
face that he could no longer see. Smoke filled the
cockpit.
Harper undid his harness and started to bail out. Then he
realized that the ground was only about 50 feet below. So
he sat back down in his seat and prepared to crash.
Seeing the field again, for the first time since the
event, Harper turned to me: "I don't know how I survived.
A P-38 can't glide at less than, say, 130 miles per hour.
I should have been killed."
But the wires that held up the grapevines slowed the
plane. Harper jumped out of the cockpit with no further
injury. At first, Jacqueline Thomas thought he must be a
German. She started to run away. Then by some instinct
she decided to go to his aid. His face was covered with
blood. And the Germans could arrive at any minute.
She led him to her grandfather's house. No one was home.
She tended his head wound in the only manner she knew --
dousing it with "eau de vie," strong spirits that hurt so
much that Col. Harper recalls the pain to this day.
Not long after, Jacqueline's father arrived. He had seen
the plane go down and was concerned for his daughter.
Taking command of the situation, he had Harper take off
his clothes and dressed him as local farmer.
The two grabbed fishing poles and went down to the river
where, pretending to fish, they made their way to a cave
where Harper was hidden.
Eventually, Resistance leaders were contacted. Harper was
driven to a farm where another woman took charge of him -
- Denise LaBrousse. She was there yesterday, too. Nothing
seemed to have changed. Harper was vigorous -- with a
sense of humor and a friendly smile. Jacqueline still
seemed like the teenaged girl who found him in the field.
And Madame LaBrousse looked like she's probably always
looked. She looked like she could make a good omelet --
which is just what she did for Harper.
As the story was told, each of these people made their
way up to take their places alongside Col. Harper...
Denise LaBrousse walking with difficulty with the aid of
a cane.
And there they stood. The mayor of Montmorillon had
invited me to the ceremony as a representative of the
local American community ("I not only represent it," I
explained to Col. Harper, "I am it. Apart from my family,
there are no other Americans in the area.") and as an
interpreter. He now presented Col. Harper with a medal
from the town.
A representative of the French Air Force gave him another
medal -- a set of wings. The band struck up the Star
Spangled Banner...and then the Marseillaise.
Tears welled up in many eyes. Many of those present had
fought in the war. Others had vivid memories of it. My
friend, Gilbert Mining, was there. He had made his way to
North Africa to join the Free French Forces of de Gaulle.
He'd made friends with an American soldier...whom he has
never seen again. Another old soldier sat next to me at
the dinner following the ceremonies in the field. He had
been with the French army at the Maginot Line. They were
driven back by the Germans and finally pinned against the
Loire River.
"I asked my commander for permission to desert," said the
retired schoolteacher. "He told me to go ahead. So I swam
across the river. Then I fought in North Africa...and
then back to France."
Harper, meanwhile, went on to glory. He joined the local
S.A.S. forces, Britain's underground operation that
coordinated resistance activity throughout the war.
John Fielding, an Englishman who was part of the local
unit, was also at yesterday's ceremony.
Together with the local French resistance, they blew up
train lines to keep the Germans from moving troops from
the south of France to the front in Normandy.
But Harper did not remain on the ground, or under it, for
long. Scarcely three weeks after the local paper in Utah
reported him "missing in action," he was back in
England and back in the cockpit on various missions.
Later, in Korea, he was shot down again. His ribs were
broken, but he managed to kill two North Korean soldiers
with a handgun and was rescued by helicopter. He became
the only pilot to get shot down in two wars and keep on
flying.
But the most remarkable phase of his career was probably
during the period following his rescue in North Korea.
While he was recovering from his injuries, Harper
directed the activities of his unit of flyers. One of his
pilots reported a massive build-up of supply trains in
the sector. Harper was unable to get permission for an
attack, but ordered it anyway. The pilots went to work.
They discovered that the boxcars were loaded with
ammunition. The whole sky lit up, brightened by the
explosions. Encouraged, they just kept hitting the train,
which just kept blowing up.
Some military historians believe this attack was the key
to ending the war. The ammunitions train was meant to
supply a massive million-man Chinese army. Without
supplies, the offensive was called off, and the North
Koreans decided to resort to the bargaining table.
But world politics were a long way away from the thoughts
of those assembled here in Montmorillon this weekend.
"I'm just glad to be alive," said Harper.
Your correspondent,
Bill Bonner
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