Sunday, January 27, 2008

Does God Want You To Be Rich?

Does God Want You To Be Rich?

A growing number of Protestant evangelists raise a joyful Yes! But the idea is poison to other, more mainstream pastors
By DAVID VAN BIEMA, JEFF CHU

Posted Sunday, Sep. 10, 2006

When George Adams lost his job at an Ohio tile factory last October, the most practical thing he did, he thinks, was go to a new church, even though he had to move his wife and four preteen boys to Conroe, a suburb of Houston, to do it. Conroe, you see, is not far from Lakewood, the home church of megapastor and best-selling author Joel Osteen.

Osteen's relentlessly upbeat television sermons had helped Adams, 49, get through the hard times, and now Adams was expecting the smiling, Texas-twanged 43-year-old to help boost him back toward success. And Osteen did. Inspired by the preacher's insistence that one of God's top priorities is to shower blessings on Christians in this lifetime--and by the corollary assumption that one of the worst things a person can do is to expect anything less--Adams marched into Gullo Ford in Conroe looking for work. He didn't have entry-level aspirations: "God has showed me that he doesn't want me to be a run-of-the-mill person," he explains. He demanded to know what the dealership's top salesmen made--and got the job. Banishing all doubt--"You can't sell a $40,000-to-$50,000 car with menial thoughts"--Adams took four days to retail his first vehicle, a Ford F-150 Lariat with leather interior. He knew that many fellow salesmen don't notch their first score until their second week. "Right now, I'm above average!" he exclaims. "It's a new day God has given me! I'm on my way to a six-figure income!" The sales commission will help with this month's rent, but Adams hates renting. Once that six-figure income has been rolling in for a while, he will buy his dream house: "Twenty-five acres," he says. "And three bedrooms. We're going to have a schoolhouse (his children are home schooled). We want horses and ponies for the boys, so a horse barn. And a pond. And maybe some cattle."

"I'm dreaming big--because all of heaven is dreaming big," Adams continues. "Jesus died for our sins. That was the best gift God could give us," he says. "But we have something else. Because I want to follow Jesus and do what he ordained, God wants to support us. It's Joel Osteen's ministry that told me. Why would an awesome and mighty God want anything less for his children?"

In three of the Gospels, Jesus warns that each of his disciples may have to "deny himself" and even "take up his Cross." In support of this alarming prediction, he forcefully contrasts the fleeting pleasures of today with the promise of eternity: "For what profit is it to a man," he asks, "if he gains the whole world, and loses his own soul?" It is one of the New Testament's hardest teachings, yet generations of churchgoers have understood that being Christian, on some level, means being ready to sacrifice--money, autonomy or even their lives.

But for a growing number of Christians like George Adams, the question is better restated, "Why not gain the whole world plus my soul?" For several decades, a philosophy has been percolating in the 10 million--strong Pentecostal wing of Christianity that seems to turn the Gospels' passage on its head: certainly, it allows, Christians should keep one eye on heaven. But the new good news is that God doesn't want us to wait. Known (or vilified) under a variety of names--Word of Faith, Health and Wealth, Name It and Claim It, Prosperity Theology--its emphasis is on God's promised generosity in this life and the ability of believers to claim it for themselves. In a nutshell, it suggests that a God who loves you does not want you to be broke. Its signature verse could be John 10: 10: "I have come that they may have life, and that they may have it more abundantly." In a TIME poll, 17% of Christians surveyed said they considered themselves part of such a movement, while a full 61% believed that God wants people to be prosperous. And 31%--a far higher percentage than there are Pentecostals in America--agreed that if you give your money to God, God will bless you with more money.

"Prosperity" first blazed to public attention as the driveshaft in the moneymaking machine that was 1980s televangelism and faded from mainstream view with the Jim Bakker and Jimmy Swaggart scandals. But now, after some key modifications (which have inspired some to redub it Prosperity Lite), it has not only recovered but is booming. Of the four biggest megachurches in the country, three--Osteen's Lakewood in Houston; T.D. Jakes' Potter's House in south Dallas; and Creflo Dollar's World Changers near Atlanta--are Prosperity or Prosperity Lite pulpits (although Jakes' ministry has many more facets). While they don't exclusively teach that God's riches want to be in believers' wallets, it is a key part of their doctrine. And propelled by Osteen's 4 million--selling book, Your Best Life Now, the belief has swept beyond its Pentecostal base into more buttoned-down evangelical churches, and even into congregations in the more liberal Mainline. It is taught in hundreds of non-Pentecostal Bible studies. One Pennsylvania Lutheran pastor even made it the basis for a sermon series for Lent, when Christians usually meditate on why Jesus was having His Worst Life Then. Says the Rev. Chappell Temple, a Methodist minister with the dubious distinction of pastoring Houston's other Lakewood Church (Lakewood United Methodist), an hour north of Osteen's: "Prosperity Lite is everywhere in Christian culture. Go into any Christian bookstore, and see what they're offering."

The movement's renaissance has infuriated a number of prominent pastors, theologians and commentators. Fellow megapastor Rick Warren, whose book The Purpose Driven Life has outsold Osteen's by a ratio of 7 to 1, finds the very basis of Prosperity laughable. "This idea that God wants everybody to be wealthy?", he snorts. "There is a word for that: baloney. It's creating a false idol. You don't measure your self-worth by your net worth. I can show you millions of faithful followers of Christ who live in poverty. Why isn't everyone in the church a millionaire?"

The brickbats--both theological and practical (who really gets rich from this?)--come especially thick from Evangelicals like Warren. Evangelicalism is more prominent and influential than ever before. Yet the movement, which has never had a robust theology of money, finds an aggressive philosophy advancing within its ranks that many of its leaders regard as simplistic, possibly heretical and certainly embarrassing.

Prosperity's defenders claim to be able to match their critics chapter and verse. They caution against broad-brushing a wide spectrum that ranges from pastors who crassly solicit sky's-the-limit financial offerings from their congregations to those whose services tend more toward God-fueled self-help. Advocates note Prosperity's racial diversity--a welcome exception to the American norm--and point out that some Prosperity churches engage in significant charity. And they see in it a happy corrective for Christians who are more used to being chastened for their sins than celebrated as God's children. "Who would want to get in on something where you're miserable, poor, broke and ugly and you just have to muddle through until you get to heaven?" asks Joyce Meyer, a popular television preacher and author often lumped in the Prosperity Lite camp. "I believe God wants to give us nice things." If nothing else, Meyer and other new-breed preachers broach a neglected topic that should really be a staple of Sunday messages: Does God want you to be rich?

As with almost any important religious question, the first response of most Christians (especially Protestants) is to ask how Scripture treats the topic. But Scripture is not definitive when it comes to faith and income. Deuteronomy commands believers to "remember the Lord your God, for it is He who gives you power to get wealth", and the rest of the Old Testament is dotted with celebrations of God's bestowal of the good life. On at least one occasion--the so-called parable of the talents (a type of coin)--Jesus holds up savvy business practice (investing rather than saving) as a metaphor for spiritual practice. Yet he spent far more time among the poor than the rich, and a majority of scholars quote two of his most direct comments on wealth: the passage in the Sermon on the Mount in which he warns, "Do not lay up for yourselves treasures on earth ... but lay up for yourselves treasures in heaven"; and his encounter with the "rich young ruler" who cannot bring himself to part with his money, after which Jesus famously comments, "It is easier for a camel to go through the eye of a needle than for a rich man to enter the kingdom of God."

Both statements can be read as more nuanced than they at first may seem. In each case it is not wealth itself that disqualifies but the inability to understand its relative worthlessness compared with the riches of heaven. The same thing applies to Paul's famous line, "Money is the root of all evil," in his first letter to Timothy. The actual quote is, "The love of money is a root of all kinds of evil."

So the Bible leaves plenty of room for a discussion on the role, positive or negative, that money should play in the lives of believers. But it's not a discussion that many pastors are willing to have. "Jesus' words about money don't make us very comfortable, and people don't want to hear about it," notes Collin Hansen, an editor at the evangelical monthly Christianity Today. Pastors are happy to discuss from the pulpit hot-button topics like sex and even politics. But the relative absence of sermons about money--which the Bible mentions several thousand times--is one of the more stunning omissions in American religion, especially among its white middle-class precincts. Princeton University sociologist Robert Wuthnow says much of the U.S. church "talks about giving but does not talk about the broader financial concerns people have, or the pressures at work. There has long been a taboo on talking candidly about money."

In addition to personal finances, a lot of evangelical churches have also avoided any pulpit talk about social inequality. When conservative Christianity split from the Mainline in the early 20th century, the latter pursued their commitment to the "social gospel" by working on poverty and other causes such as civil rights and the Vietnam-era peace movement. Evangelicals went the other way: they largely concentrated on issues of individual piety. "We took on personal salvation--we need our sins redeemed, and we need our Saviour," says Warren. But "some people tended to go too individualistic, and justice and righteousness issues were overlooked."

A recent Sunday at Lakewood gives some idea of the emphasis on worldly gain that disturbs Warren. Several hundred stage lights flash on, and Osteen, his gigawatt smile matching them, strides onto the stage of what used to be the Compaq Center sports arena but is now his church. "Let's just celebrate the goodness of the Lord!" Osteen yells. His wife Victoria says, "Our Daddy God is the strongest! He's the mightiest!"

And so it goes, before 14,000 attendees, a nonstop declaration of God's love and his intent to show it in the here and now, sometimes verging on the language of an annual report. During prayer, Osteen thanks God for "your unprecedented favor. We believe that 2006 will be our best year so far. We declare it by faith." Today's sermon is about how gratitude can "save a marriage, save your job [and] get you a promotion."

"I don't think I've ever preached a sermon about money," he says a few hours later. He and Victoria meet with TIME in their pastoral suite, once the Houston Rockets' locker and shower area but now a zone of overstuffed sofas and imposing oak bookcases. "Does God want us to be rich?" he asks. "When I hear that word rich, I think people say, 'Well, he's preaching that everybody's going to be a millionaire.' I don't think that's it." Rather, he explains, "I preach that anybody can improve their lives. I think God wants us to be prosperous. I think he wants us to be happy. To me, you need to have money to pay your bills. I think God wants us to send our kids to college. I think he wants us to be a blessing to other people. But I don't think I'd say God wants us to be rich. It's all relative, isn't it?" The room's warm lamplight reflects softly off his crocodile shoes.

Osteen is a second-generation Prosperity teacher. His father John Osteen started out Baptist but in 1959 withdrew from that fellowship to found a church in one of Houston's poorer neighborhoods and explore a new philosophy developing among Pentecostals. If the rest of Protestantism ignored finances, Prosperity placed them center stage, marrying Pentecostalism's ebullient notion of God's gifts with an older tradition that stressed the power of positive thinking. Practically, it emphasized hard work and good home economics. But the real heat was in its spiritual premise: that if a believer could establish, through word and deed (usually donation), that he or she was "in Jesus Christ," then Jesus' father would respond with paternal gifts of health and wealth in this life. A favorite verse is from Malachi: "'Bring all the tithes into the storehouse ... and try Me now in this,' says the Lord of hosts. 'If I will not for you open the windows of heaven and pour out for you such blessing that there will not be room enough to receive it.'" (See boxes.)

It is a peculiarly American theology but turbocharged. If Puritanism valued wealth and Benjamin Franklin wrote about doing well by doing good, hard-core Prosperity doctrine, still extremely popular in the hands of pastors like Atlanta megachurch minister Creflo Dollar, reads those Bible verses as a spiritual contract. God will pay back a multiple (often a hundredfold) on offerings by the congregation. "Poor people like Prosperity," says Stephen Prothero, chairman of the religion department at Boston University. "They hear it as aspirant. They hear, 'You can make it too--buy a car, get a job, get wealthy.' It can function as a form of liberation." It can also be exploitative. Outsiders, observes Milmon Harrison of the University of California at Davis, author of the book Righteous Riches, often see it as "another form of the church abusing people so ministers could make money."

In the past decade, however, the new generation of preachers, like Osteen, Meyer and Houston's Methodist megapastor Kirbyjon Caldwell, who gave the benediction at both of George W. Bush's Inaugurals, have repackaged the doctrine. Gone are the divine profit-to-earnings ratios, the requests for offerings far above a normal 10% tithe (although many of the new breed continue to insist that congregants tithe on their pretax rather than their net income). What remains is a materialism framed in a kind of Tony Robbins positivism. No one exemplifies this better than Osteen, who ran his father's television-production department until John died in 1999. "Joel has learned from his dad, but he has toned it back and tapped into basic, everyday folks' ways of talking," says Ben Phillips, a theology professor at the Southwestern Baptist Theological Seminary. That language is reflected in Your Best Life Now, an extraordinarily accessible exhortation to this-world empowerment through God. "To live your best life now," it opens, to see "your business taking off. See your marriage restored. See your family prospering. See your dreams come to pass ..." you must "start looking at life through eyes of faith." Jesus is front and center but not his Crucifixion, Resurrection or Atonement. There are chapters on overcoming trauma and a late chapter on emulating God's generosity. (And indeed, Osteen's church gave more than $1 million in relief money after Hurricane Katrina.) But there are many more illustrations of how the Prosperity doctrine has produced personal gain, most memorably, perhaps, for the Osteen family: how Victoria's "speaking words of faith and victory" eventually brought the couple their dream house; how Joel discerned God's favor in being bumped from economy to business class.

Confronting such stories, certain more doctrinally traditional Christians go ballistic. Last March, Ben Witherington, an influential evangelical theologian at Asbury Seminary in Kentucky, thundered that "we need to renounce the false gospel of wealth and health--it is a disease of our American culture; it is not a solution or answer to life's problems." Respected blogger Michael Spencer--known as the Internet Monk--asked, "How many young people are going to be pointed to Osteen as a true shepherd of Jesus Christ? He's not. He's not one of us." Osteen is an irresistible target for experts from right to left on the Christian spectrum who--beyond worrying that he is living too high or inflating the hopes of people with real money problems--think he is dragging people down with a heavy interlocked chain of theological and ethical errors that could amount to heresy.

Most start out by saying that Osteen and his ilk have it "half right": that God's goodness is biblical, as is the idea that he means us to enjoy the material world. But while Prosperity claims to be celebrating that goodness, the critics see it as treating God as a celestial ATM. "God becomes a means to an end, not the end in himself," says Southwestern Baptist's Phillips. Others are more upset about what it de-emphasizes. "[Prosperity] wants the positive but not the negative," says another Southern Baptist, Alan Branch of Midwestern Baptist Theological Seminary in Kansas City, Mo. "Problem is, we live on this side of Eden. We're fallen." That is, Prosperity soft-pedals the consequences of Adam's fall--sin, pain and death--and their New Testament antidote: Jesus' atoning sacrifice and the importance of repentance. And social liberals express a related frustration that preachers like Osteen show little interest in battling the ills of society at large. Perhaps appropriately so, since, as Prosperity scholar Harrison explains, "philosophically, their main way of helping the poor is encouraging people not to be one of them."

Most unnerving for Osteen's critics is the suspicion that they are fighting not just one idiosyncratic misreading of the gospel but something more daunting: the latest lurch in Protestantism's ongoing descent into full-blown American materialism. After the eclipse of Calvinist Puritanism, whose respect for money was counterbalanced by a horror of worldliness, much of Protestantism quietly adopted the idea that "you don't have to give up the American Dream. You just see it as a sign of God's blessing," says Edith Blumhofer, director of Wheaton College's Center for the Study of American Evangelicals. Indeed, a last-gasp resistance to this embrace of wealth and comfort can be observed in the current evangelical brawl over whether comfortable megachurches (like Osteen's and Warren's) with pumped-up day-care centers and high-tech amenities represent a slide from glorifying an all-powerful God to asking what custom color you would prefer he paint your pews. "The tragedy is that Christianity has become a yes-man for the culture," says Boston University's Prothero.

Non-prosperity parties from both conservative and more progressive evangelical camps recently have been trying to reverse the trend. Eastern University professor Ron Sider's book Rich Christians in an Age of Hunger, a fringe classic after its publication in 1977, is selling far more copies now, and some young people are even acting on its rather radical prescriptions: a sprinkling of Protestant groups known loosely as the New Monastics is experimenting with the kind of communal living among the poor that had previously been the province of Catholic orders. Jim Wallis, longtime leader of one such community in Washington and the editor of Sojourners magazine, has achieved immense exposure lately with his pleas that Evangelicals engage in more political activism on behalf of the poor.

And then there is Warren himself, who by virtue of his energy, hypereloquence and example (he's working in Rwanda with government, business and church sectors) has become a spokesman for church activism. "The church is the largest network in the world," he says. "If you have 2.3 billion people who claim to be followers of Christ, that's bigger than China."

And despite Warren's disdain for Prosperity's theological claims, some Prosperity churches have become players in the very faith-based antipoverty world he inhabits, even while maintaining their distinctive theology. Kirbyjon Caldwell, who pastors Windsor Village, the largest (15,000) United Methodist church in the country, can sound as Prosperity as the next pastor: "Jesus did not die and get up off the Cross so we could live lives full of despair and disappointment," he says. He quotes the "abundant life" verse with all earnestness, even giving it a real estate gloss: "It is unscriptural not to own land," he announces. But he's doing more than talk about it. He recently oversaw the building of Corinthian Pointe, a 452-unit affordable-housing project that he claims is the largest residential subdivision ever built by a nonprofit. Most of its inhabitants, he says, are not members of his church.

Caldwell knows that prosperity is a loaded term in evangelical circles. But he insists that "it depends on how you define prosperity. I am not a proponent of saying the Lord's name three times, clicking your heels and then you get what you ask for. But you cannot give what you do not have. We are fighting what we call the social demons. If I am going to help someone, I am going to have to have something with which to help."

Caldwell knows that the theology behind this preacherly rhetoric will never be acceptable to Warren or Sider or Witherington. But the man they all follow said, "By their fruits you will know them," and for some, Corinthian Pointe is a very convincing sort of fruit. Hard-line Prosperity theology may always seem alien to those with enough money to imagine making more without engaging God in a kind of spiritual quid pro quo. And Osteen's version, while it abandons part of that magical thinking, may strike some as self-centered rather than God centered. But American Protestantism is a dynamic faith. Caldwell's version reminds us that there is no reason a giving God could not invest even an awkward and needy creed with a mature and generous heart. If God does want us to be rich in this life, no doubt it's this richness in spirit that he is most eager for us to acquire.

Conference scholars reject 'Jesus coffin'

TOMB RAIDERS
Conference scholars reject 'Jesus coffin'
Say filmmaker's identification of burial site falls on statistical, DNA, epigraphic evidence


Posted: January 26, 2008
8:00 p.m. Eastern


© 2008 WorldNetDaily.com


"Tomb of Jesus" outside Jerusalem
A group of scholars is disputing the positive media coverage given a Jerusalem conference earlier this month on the so-called tomb of Jesus popularized last year by "Titanic" director James Cameron and Jewish investigative journalist and filmmaker Simcha Jacobovici, saying the majority of experts and academics in attendence either rejected the identification of the site excavated in 1980 as belonging to Jesus' family or find the claim highly speculative.

As WND reported in February 2007, the Oscar-winning director's film project, "The Lost Tomb of Jesus," claimed the discovery of 10 stone coffins in a Jerusalem suburb is actually the family crypt of Jesus of Nazareth.

The 90-minute film, made for the Discovery Channel, makes the case that Jesus had a son named Judah with Mary Magdalene.

Cameron and his director, Jacobovici, claimed also to have DNA evidence to back their story.

"People who believe in a physical ascension – that he took his body to heaven – those people will say, 'Wait a minute,'" warned Jacobovici.

According to the filmmakers, 10 ossuaries, or stone boxes containing bones, found in the first century tomb are almost certain to hold the remains of Jesus, Mary Magdalene his wife, Judah their son and other family members.

One of the ossuaries is reportedly inscribed, "Jesus son of Joseph," another "Mariemene e Mara," which in some early Christian texts was believed to refer to Mary Magdalene, and another "Judah son of Jesus." DNA analysis of the bones reportedly showed Jesus and Mariemene were unrelated adults, leading to the conclusion they were husband and wife. Other ossuaries were inscribed with the names Mary, Mathew, and Jofa.

The news came a year after release of "The Da Vinci Code" movie, based on the best-selling novel of 2004 by Dan Brown, both of which also claimed Mary Magdalene was the wife of Jesus.

"This is archaeology," claims James Tabor, chairman of the religious studies department at the University of North Carolina, who is interviewed throughout the documentary. "We've got the casket. We've got the bones. I think we can say, in all probability, Jesus had this son, Judah, presumably through Mary Magdalene."

Cameron and Jacobovici cited statistical analysis that suggested finding the combination of related historical names in a first century crypt at 600 to 1.

Those claims were the subject of the "Third Princeton Theological Seminary Symposium on Jewish Views of the Afterlife and Burial Practices in Second Temple Judaism: Evaluating the Talpiot Tomb in Context," held Jan. 13-16, 2008, in Jerusalem. The conference was attended by some fifty international and Israeli scholars.

According to a posting on the Princeton Theological Seminary website, the consensus of the participants was against the tomb being related to Christianity's founder.

"Unfortunately, many of the initial reports in the press following the symposium gave almost the exact opposite impression, stating, instead, that the conference proceedings gave credence to the identification of the Talpiot tomb with a putative family tomb of Jesus of Nazareth. As is abundantly clear from the statements to the contrary that have been issued since the symposium by many of the participants, such representations are patently false and blatantly misrepresent the spirit and scholarly content of the deliberations."

Several scholars issued a statement on the Duke University Religion Department's website indicating their rejection of the filmmakers' claims and disputing the press coverage.

  • Professor Mordechai Aviam, University of Rochester
  • Professor Ann Graham Brock, Iliff School of Theology, University of Denver
  • Professor F.W. Dobbs-Allsopp, Princeton Theological Seminary
  • Professor C.D. Elledge, Gustavus Adolphus College
  • Professor Shimon Gibson, University of North Carolina at Charlotte
  • Professor Rachel Hachlili, University of Haifa
  • Professor Amos Kloner, Bar-Ilan University
  • Professor Jodi Magness, University of North Carolina at Chapel Hill
  • Professor Lee McDonald, Arcadia Seminary
  • Professor Eric M. Meyers, Duke University
  • Professor Stephen Pfann, University of the Holy Land
  • Professor Jonathan Price, Tel Aviv University
  • Professor Christopher Rollston, Emmanuel School of Religion
  • Professor Alan F. Segal, Barnard College, Columbia University
  • Professor Choon-Leong Seow, Princeton Theological Seminary
  • Mr. Joe Zias, Science and Antiquity Group, Jerusalem
  • Dr. Boaz Zissu, Bar-Ilan University


The conference featured a challenge to the identification of "Mariemene" with Mary Magdalene, a crucial part of the statistical analysis behind Cameron's and Jacobovici's confidence.

Professor Stephen Pfann, of the University of the Holy Land in Jerusalem, said the inscription does not read "Mariemene e Mara" at all but instead "Mariame" and "kai Mara," suggesting the ossuary contained bones of two women, Mary and Martha. Further, other scholars of early church history dismissed the link between "Mariamene" and Mary Magdelene.

"A statistical analysis of the names engraved on the ossuaries leaves no doubt that the probability of the Talpiot tomb belonging to Jesus' family is virtually nil if the Mariamene named on one of the ossuaries is not Mary Magdalene," wrote Duke University Professor Eric M. Meyers.

"Even the reading of the inscribed name as 'Mariamene' was contested by epigraphers at the conference," he wrote. "Furthermore, Mary Magdalene is not referred to by the Greek name Mariamene in any literary sources before the late second-third century AD. An expert panel of scholars on the subject of Mary in the early church dismissed out of hand the suggestion that Mary Magdalene was married to Jesus, and no traditions refer to a son of Jesus named Judah."

Myer also disputed the DNA claims of the filmmakers, citing a report by the head of the DNA laboratory at Hebrew University that concluded the sampling of the bone material was invalid and contaminated and could not be used to infer that "Jesus" and "Mariemene" were unrelated adults and, therefore, likely husband and wife.

"It was not even worth discussion. That should have closed the case," Myers told Christian Post.

The "smoking gun" at the conference, said Myers, was a surprise appearance by Ruth Gat, the widow of the archaeologist who excavated the tomb in 1980 and has since passed away.

Gat told the scholars her husband Yosef knew he had found "the burial tomb of Jesus Christ," but had "serious concerns and fears" over publicizing his discovery. Having been a child in Nazi-occupied Poland, he feared "a wave of anti-Semitism" because of his find.

Gat told the Jerusalem Post after her address her husband had been "staggered" by the discovery, and that he had discussed it with her "at the kitchen table."

Film director Jacobovici, who attended the symposium, said he "fell off the chair" when he heard her and claimed he had been vindicated by Gat's statement.

But Gat's claim was disputed by panelist Shimon Gibson, who was a young archeologist on the 1980 dig. He said Yosef never told him he believed the tomb was Jesus'.

Amos Kloner, former Jerusalem District archeologist, who wrote the excavation report from Gat's minimal notes 16 years after the find, said the notion Gat believed he had found Jesus' tomb was "absolutely not the case."

Further, noted Myers, Gat was a field archaelogist and did not have the epigraphic expertise to read the inscriptions.

According to Kloner, who called Jacobovici "a liar" at one session of the symposium and earlier branded the documentary "brain confusion," most of the bones found in the ossuaries 28 years ago were badly decomposed. Because of pressures from religious Jews, they were never subjected to anthropological tests and were transferred to the Religious Affairs Ministry for immediate reburial along with other remains found in construction projects and archaeological excavations. Their location is not known.

Judging churches for being judgmental

WND Exclusive Commentary


Judging churches for being judgmental

Posted: January 26, 2008
1:00 a.m. Eastern

By Robert Knight

If you wanted to scare your readers into avoiding conservative Christian churches, how would you go about it?

The Wall Street Journal's Weekend Journal section did a bang-up job on Jan. 18 with a hostile, one-sided article about church discipline, complete with a color drawing of a banished soul and the headline "Banned From Church" in massive type.

On the full runover page, the piece is illustrated with a graphic entitled "Cast Out" that helpfully gives us "A Brief History of Shunning, Excommunication and Getting Burned at the Stake in Christianity."

Skipping happily down the church hater's version of Memory Lane, the graphic shows Adam and Eve kicked out of the Garden of Eden, and various dark moments in church history such as witch burnings, Galileo getting jailed for heresy and Joan of Arc's martyrdom. It finishes with the 20th century example of California pastor David Hocking losing his ministry in 1992 over a relationship with a married woman.

Alexandra Alter, the author, constructs her article around the case of Karolyn Caskey, 71, who has continued to attend the Allen Baptist Church in southwestern Michigan after being expelled over a dispute with the new pastor, who declined to be interviewed. Even if the one-sided account is roughly accurate, why make it the centerpiece? The effect is to portray church discipline as bizarre and anachronistic. Indeed, the subheadline is:

"Reviving an ancient practice, churches are exposing sinners and shunning those who won't repent."



An "ancient" practice is immediately suspect to many journalists, unless it's of pagan origin.

As Alter explains in the article, "Her story reflects a growing movement among some conservative Protestant pastors to bring back church discipline, an ancient practice in which suspected sinners are privately confronted and then publicly castigated and excommunicated if they refuse to repent."

Egad. How frightening is this trend?

In the past decade, more than two dozen lawsuits related to church discipline have been filed as congregants sue pastors for defamation, negligent counseling and emotional injury, according to the Religion Case Reporter, a legal-research database.

"Two dozen lawsuits" sounds alarming until you realize that America has 536,480 church congregations (as of 2000, according to the Association of Religion Data Archives). Alter reports that 14,000 to 21,000 U.S. Protestant evangelical churches, or 10 to 15 percent, practice some form of church discipline. With all that discipline (and counseling) going on, a couple of dozen cases is hardly a legal avalanche.

Since Alter put churches in the dock for enforcing the "ancient" practice of shunning, she should have analyzed the relevant biblical passages. No such luck. The best we get is: "Others point to a passage in the gospel of Matthew that says unrepentant sinners must be shunned." My guess is that Alter probably heard about Matthew 18:15-17, in which Jesus Himself instructs the church in how to deal with unrepentant sinners:

Moreover if your brother sins against you, go and tell him his fault between you and him alone. If he hears you, you have gained your brother. But if he will not hear, take with you one or two more, that "by the mouth of two or three witnesses every word may be established." And if he refuses to hear them, tell it to the church. But if he refuses even to hear the church, let him be to you like a heathen and a tax collector (New King James Version).

It would make sense for any article on church shunning to include the passage above. At least it would unless the writer is Bibliophobic. Or biblically challenged. Perhaps Alter was worried about making an error like the late ABC anchorman Peter Jennings, who once cited a verse from "Eleven Chronicles." (The Old Testament includes the books First Chronicles and Second Chronicles, usually written as I Chronicles and II Chronicles.)

Moving along in her piece, Alter quickly returns to making churches look like meanies, with anecdotes like this one:

The process can be messy, says Al Jackson, pastor of Lakeview Baptist Church in Auburn, Ala., which began disciplining members in the 1990s. Once when the congregation voted out an adulterer who had refused to repent, an older woman was confused and thought the church had voted to send the man to hell.

Presumably, the pastor straightened her out instead of putting her in a ducking chair in a nearby river (an activity the reader can see in the informative Cast Out graphic). But you can't be too sure when it comes to these conservative Christians.

Weaving the sad, arguably deplorable plight of Mrs. Caskey throughout the article, Alter pauses here and there to share more historical nuggets that might persuade even the most curious never to darken a church door. At least, not the doors of evangelical churches, or those in Catholic dioceses where some bishops have denied communion to public figures who support abortion on demand.

In Christianity's early centuries, church discipline led sinners to cover themselves with ashes or spend time in the stocks. In later centuries, expulsion was more common. Until the late 19th century, shunning was widely practiced by American evangelicals, including Methodists, Presbyterians and Baptists. Today, excommunication rarely occurs in the U.S. Catholic Church, and shunning is largely unheard of among mainline Protestants.

And it's a good thing too, or lots of "pro-choice" and serial-marrying politicians might be embarrassed, leaving us all fewer "choices."

Saturday, January 26, 2008

Banned From Church

Banned From Church

Reviving an ancient practice, churches are exposing sinners and shunning those who won't repent.
By ALEXANDRA ALTER
January 18, 2008; Page W1

On a quiet Sunday morning in June, as worshippers settled into the pews at Allen Baptist Church in southwestern Michigan, Pastor Jason Burrick grabbed his cellphone and dialed 911. When a dispatcher answered, the preacher said a former congregant was in the sanctuary. "And we need to, um, have her out A.S.A.P."

[Shun]

Half an hour later, 71-year-old Karolyn Caskey, a church member for nearly 50 years who had taught Sunday school and regularly donated 10% of her pension, was led out by a state trooper and a county sheriff's officer. One held her purse and Bible. The other put her in handcuffs. (Listen to the 911 call)

The charge was trespassing, but Mrs. Caskey's real offense, in her pastor's view, was spiritual. Several months earlier, when she had questioned his authority, he'd charged her with spreading "a spirit of cancer and discord" and expelled her from the congregation. "I've been shunned," she says.

Her story reflects a growing movement among some conservative Protestant pastors to bring back church discipline, an ancient practice in which suspected sinners are privately confronted and then publicly castigated and excommunicated if they refuse to repent. While many Christians find such practices outdated, pastors in large and small churches across the country are expelling members for offenses ranging from adultery and theft to gossiping, skipping service and criticizing church leaders.

[Church]
Dave Krieger/Getty Images
PODCASTS
Hear an interview with Doug Laycock, a professor of constitutional law at the University of Michigan, about the legal implications of church discipline.
Hear the 911 call made by Pastor Burrick.
* * *
CAST OFF
Timeline: View a brief history of shunning and excommunication.

The revival is part of a broader movement to restore churches to their traditional role as moral enforcers, Christian leaders say. Some say that contemporary churches have grown soft on sinners, citing the rise of suburban megachurches where pastors preach self-affirming messages rather than focusing on sin and redemption. Others point to a passage in the gospel of Matthew that says unrepentant sinners must be shunned.

Causing Disharmony

Watermark Community Church, a nondenominational church in Dallas that draws 4,000 people to services, requires members to sign a form stating they will submit to the "care and correction" of church elders. Last week, the pastor of a 6,000-member megachurch in Nashville, Tenn., threatened to expel 74 members for gossiping and causing disharmony unless they repented. The congregants had sued the pastor for access to the church's financial records.

First Baptist Church of Muscle Shoals, Ala., a 1,000-member congregation, expels five to seven members a year for "blatant, undeniable patterns of willful sin," which have included adultery, drunkenness and refusal to honor church elders. About 400 people have left the church over the years for what they view as an overly harsh persecution of sinners, Pastor Jeff Noblit says.

The process can be messy, says Al Jackson, pastor of Lakeview Baptist Church in Auburn, Ala., which began disciplining members in the 1990s. Once, when the congregation voted out an adulterer who refused to repent, an older woman was confused and thought the church had voted to send the man to hell.

[Shun]
Karolyn Caskey was expelled from Allen Baptist Church after clashing with the pastor.

Amy Hitt, 43, a mortgage officer in Amissville, Va., was voted out of her Baptist congregation in 2004 for gossiping about her pastor's plans to buy a bigger house. Her ouster was especially hard on her twin sons, now 12 years old, who had made friends in the church, she says. "Some people have looked past it, but then there are others who haven't," says Ms. Hitt, who believes the episode cost her a seat on the school board last year; she lost by 42 votes.

Scholars estimate that 10% to 15% of Protestant evangelical churches practice church discipline -- about 14,000 to 21,000 U.S. congregations in total. Increasingly, clashes within churches are spilling into communities, splitting congregations and occasionally landing church leaders in court after congregants, who believed they were confessing in private, were publicly shamed.

In the past decade, more than two dozen lawsuits related to church discipline have been filed as congregants sue pastors for defamation, negligent counseling and emotional injury, according to the Religion Case Reporter, a legal-research database. Peggy Penley, a Fort Worth, Texas, woman whose pastor revealed her extramarital affair to the congregation after she confessed it in confidence, waged a six-year battle against the pastor, charging him with negligence. Last summer, the Texas Supreme Court dismissed her suit, ruling that the pastor was exercising his religious beliefs by publicizing the affair.

[Shun]
Allen Baptist Church

Courts have often refused to hear such cases on the grounds that churches are protected by the constitutional right to free religious exercise, but some have sided with alleged sinners. In 2003, a woman and her husband won a defamation suit against the Iowa Methodist conference and its superintendent after he publicly accused her of "spreading the spirit of Satan" because she gossiped about her pastor. A district court rejected the case, but the Iowa Supreme Court upheld the woman's appeal on the grounds that the letter labeling her a sinner was circulated beyond the church.

Advocates of shunning say it rarely leads to the public disclosure of a member's sin. "We're not the FBI; we're not sniffing around people's homes trying to find out some secret sin," says Don Singleton, pastor of Ridgeview Baptist Church in Talladega, Ala., who says the 50-member church has disciplined six members in his 2½ years as pastor. "Ninety-nine percent of these cases never go that far."

When they do, it can be humiliating. A devout Christian and grandmother of three, Mrs. Caskey moves with a halting gait, due to two artificial knees and a double hip replacement. Friends and family describe her as a generous woman who helped pay the electricity bill for Allen Baptist, in Allen, Mich., when funds were low, gave the church $1,200 after she sold her van, and even cut the church's lawn on occasion. She has requested an engraved image of the church on her tombstone.

Gossip and Slander

Her expulsion came as a shock to some church members when, in August 2006, the pastor sent a letter to the congregation stating Mrs. Caskey and an older married couple, Patsy and Emmit Church, had been removed for taking "action against the church and your preacher." The pastor, Mr. Burrick, told congregants the three were guilty of gossip, slander and idolatry and should be shunned, according to several former church members.

"People couldn't believe it," says Janet Biggs, 53, a former church member who quit the congregation in protest.

The conflict had been brewing for months. Shortly after the church hired Mr. Burrick in 2005 to help revive the congregation, which had dwindled to 12 members, Mrs. Caskey asked him to appoint a board of deacons to help govern the church, a tradition outlined in the church's charter. Mr. Burrick said the congregation was too small to warrant deacons. Mrs. Caskey pressed the issue at the church's quarterly business meetings and began complaining that Mr. Burrick was not following the church's bylaws. "She's one of the nicest, kindest people I know," says friend and neighbor Robert Johnston, 69, a retired cabinet maker. "But she won't be pushed around."

[Shun]
Karolyn Caskey reads her Bible.

In April 2006, Mrs. Caskey received a stern letter from Mr. Burrick. "This church will not tolerate this spirit of cancer and discord that you would like to spread," it said. Mrs. Caskey, along with Mr. and Mrs. Church, continued to insist that the pastor follow the church's constitution. In August, she received a letter from Mr. Burrick that said her failure to repent had led to her removal. It also said he would not write her a transfer letter enabling her to join another church, a requirement in many Baptist congregations, until she had "made things right here at Allen Baptist."

She went to Florida for the winter, and when she returned to Michigan last June, she drove the two miles to Allen Baptist as usual. A church member asked her to leave, saying she was not welcome, but Mrs. Caskey told him she had come to worship and asked if they could speak after the service. Twenty minutes into the service, a sheriff's officer was at her side, and an hour later, she was in jail.

"It was very humiliating," says Mrs. Caskey, who worked for the state of Michigan for 25 years before retiring from the Department of Corrections in 1992. "The other prisoners were surprised to see a little old lady in her church clothes. One of them said, 'You robbed a church?' and I said, 'No, I just attended church.' "

Word quickly spread throughout Allen, a close-knit town of about 200 residents. Once a thriving community of farmers and factory workers, Allen consists of little more than a strip of dusty antiques stores. Mr. and Mrs. Church, both in their 70s, eventually joined another Baptist congregation nearby.

About 25 people stopped attending Allen Baptist Church after Mrs. Caskey was shunned, according to several former church members.

Current members say they support the pastor's actions, and they note that the congregation has grown under his leadership. The simple, white-washed building now draws around 70 people on Sunday mornings, many of them young families. "He's a very good leader; he has total respect for the people," says Stephen Johnson, 66, an auto parts inspector, who added that Mr. Burrick was right to remove Mrs. Caskey because "the Bible says causing discord in the church is an abomination."

Mrs. Caskey went back to the church about a month after her arrest, shortly after the county prosecutor threw out the trespassing charge. More than a dozen supporters gathered outside, some with signs that read "What Would Jesus Do?" She sat in the front row as Mr. Burrick preached about "infidels in the pews," according to reports from those present.

Once again, Mrs. Caskey was escorted out by a state trooper and taken to jail, where she posted the $62 bail and was released. After that, the county prosecutor dismissed the charge and told county law enforcement not to arrest her again unless she was creating a disturbance.

In the following weeks, Mrs. Caskey continued to worship at Allen Baptist. Some congregants no longer spoke to her or passed the offering plate, and some changed seats if she sat next to them, she says.

Mr. Burrick repeatedly declined to comment on Mrs. Caskey's case, calling it a "private ecclesiastical matter." He did say that while the church does not "blacklist" anyone, a strict reading of the Bible requires pastors to punish disobedient members. "A lot of times, flocks aren't willing to submit or be obedient to God," he said in an interview before a Sunday evening service. "If somebody is not willing to be helped, they forfeit their membership."

In Christianity's early centuries, church discipline led sinners to cover themselves with ashes or spend time in the stocks. In later centuries, expulsion was more common. Until the late 19th century, shunning was widely practiced by American evangelicals, including Methodists, Presbyterians and Baptists. Today, excommunication rarely occurs in the U.S. Catholic Church, and shunning is largely unheard of among mainline Protestants.

Little Consensus

Among churches that practice discipline, there is little consensus on how sinners should be dealt with, says Gregory Wills, a theologian at Southern Baptist Theological seminary. Some pastors remove members on their own, while other churches require agreement among deacons or a majority vote from the congregation.

Since Mrs. Caskey's second arrest last July, the turmoil at Allen Baptist has fizzled into an awkward stalemate. Allen Baptist is an independent congregation, unaffiliated with a church hierarchy that might review the ouster. Supporters have urged Mrs. Caskey to sue to have her membership restored, but she says the matter should be settled in the church. Mr. Burrick no longer calls the police when Mrs. Caskey shows up for Sunday services.

Since November, Mrs. Caskey has been attending a Baptist church near her winter home in Tavares, Fla. She plans to go back to Allen Baptist when she returns to Michigan this spring.

"I don't intend to abandon that church," Mrs. Caskey says. "I feel like I have every right to be there."

Write to Alexandra Alter at alexandra.alter@wsj.com

Ron Paul and the Lodestar of Liberty

Ron Paul and the Lodestar of Liberty

By Bruce Walker

Ron Paul is not a nut. He is honorable and intelligent. I have talked with Congressman Paul about politics and policies. He is consistent and principled. Much of what he says is true. The Constitution is routinely ignored by politicians of both political parties. Government spending, particularly entitlements, is wildly out of control. The crucial constitutional concepts of federalism and limited government are tacitly denied and this denial is the crux of many of our social and political problems.

But Ron Paul holds the vain hope that American government would return to constitutional law anytime soon, even if he did win the presidency. Congress, the judiciary, legal education, and tradition have imparted momentum to the living constitution school of thought. Bring about an actual return to the Constitution requires more than a snap of the president's fingers. Federal courts routinely "interpret" the Constitution in ways directly in conflict with the plain language of the document. At best, a president can only appoint judges the Senate will confirm and wait for natural turnover.

A lot of persuasion is necessary before Americans (including our elites and their institutions) change their way thinking. We in fact still need a crusade to change hearts and minds more than a candidacy.

And if we are going to return to first principles, remember that the Constitution is not the foundational document of our American experiment in individual liberty. It was preceded by the Articles of Confederation. Prior to the Articles of Confederation, which were adopted after independence, the Continental Congress acted as the original government of the United States and successfully waged a war against the great superpower on the planet with very little real authority. The fundamental principles of American government were established long the Constitution was adopted.

What does matter is the Declaration of Independence. The divine endowment of all people with liberty comes directly out of this document of 1776 and it is to this document that serious friends of liberty should look for inspiration and restoration. And what was the Declaration of Independence? It was, in effect, a declaration of war against the British Empire.

It was not an isolationist document but a universalist document. It speaks, pointedly, to the rest of the world. It talks about the reasons that governments are formed (not just our government.) It was bold, sweeping, and international. And it was seen by the rest of the world as just that: A revolutionary document for all peoples, even if it applied specifically only to thirteen embattled colonies in North American.

Ron Paul wants to return us to the Constitution, as if it were a sacred document which granted us freedom. Our spiritual lodestar should be the Declaration of Independence, which remains a much more dangerous, much more powerful, and much more relevant document to our times.

Some policies Paul proposes are admirable. Why do we still have armies in Germany and in Korea, when both are rich, modern industrialized nations? Why does government have to do so much and why does "government" more and more mean centralized government in Washington? Why have a tax code which punishes productivity and which requires contortionist behavior from business?

But other parts of Paul's policies simply do not fit our age. The notion that we should disengage from the Middle East, for example, suggests that Israel is "just another nation," like, say, North Korea or Syria. The foundation of the Jewish state was based upon the undeniable facts of history continuing, dreadfully, through the Holocaust, that Jews are not "just another people," but are rather a persecuted people who were not welcome when escaping Nazified Europe. Ignoring that is ignoring salient history.

Likewise, the stark contrast between Israel and its neighbors (except, until the last three decades, the successful state of Lebanon) cannot be ignored, and the murderous intent of neighbors who seriously read in large numbers Mein Kampf and the Protocols of the Learned Elders of Zion is also a grim, absolute fact of the modern world. The notion that, on paper, Israel can make peace with these neighbors is not just pure theory, but it is theory which has failed the test of experience.

Paul also seems to doubt that people wish to do America harm because it is America, and that nuclear weapons change everything. Ever since H.G. Wells first used the term "atomic bomb" in his science fiction stories more than a century ago, it has become almost inevitable that true, horrific global war power was inevitable. Happily, America acquired fission weapons and then fusion weapons first. Happily also, America has had leaders willing to use that power to protect our nation and allies who would otherwise be unprotected.

And, as we learned from the Japanese in the Second World War and from radical Moslems today, the calculus of economic benefits and political rights which works very well in moderating and balancing the behavior of most people, simply does not work with everyone. Does anyone doubt that the Japanese would have used the atomic bomb on American cities or that radical Moslems will use thermonuclear bombs on America, if they can, even if it means massive casualties in our retaliation?

Liberty can no longer stand safely behind two vast oceans and decent men can no longer ignore their human brethren after Hitler, Stalin and Mao. As Lincoln today might have said "This world cannot long endure half slave and half free." This was also perhaps the greatest victory of the greatest conservative leader of our age: Ronald Reagan. Congressman Paul might recall the Gipper's Cold War strategy: "How about this: We win; they lose?"

Ronald Reagan, like Abraham Lincoln, understood the supra-constitutional importance of liberty in the fulfillment of America, and liberty to them meant more than just the liberty of American citizens. If the ideal which is America is to survive the totalitarian impulse which we see not only in North Korea and the Taliban, but among the Leftists in our own nation, then we need to recapture the fortitude of Washington, the vision of Lincoln and the clarity of Reagan. If we can do this and preserve the vestiges of the Constitution, fine.

But the vision of America is much more than the Constitution. It is much more than Congressman Paul sees. What Ron Paul proposes is not bad or dishonest. It is simply no longer enough for liberty and decency to survive in America or in the world.

Friday, January 25, 2008

Saving and Investing: The Impact of Time

This is part sixteen in a series that will occupy the “money hacks” slot at Get Rich Slowly during April, which is National Financial Literacy Month.

During the first fifteen days of this video series, Michael Fischer explained the basics of saving and investing, introducing us to stocks, bonds, and compound returns. This week he pulls this information together to show how these concepts affect our investment decisions and our use of credit. He begins by looking at the impact of time:




The impact of time (7:15)


In this video, Michael uses several graphs to demonstrate how long-term investments in the stock market tend to minimize short term fluctuations. Because these exhibits are difficult to see in the presentation, I’ve scanned them from his book, Saving and Investing.


The market’s returns fluctuates wildly from one year to the next.

Even three-year periods show a huge range of returns, from -15% to +30%.

But move to five-year periods, and there are only a few minor dips into negative territory.

At ten years, there’s not a single period that yielded a negative return.

When we look at twenty-year investment periods, the numbers are strongly positive.

At thirty years, we see average annualized returns of 9-14%.

Now you know why it’s often claimed that the market offers a 12% average annualized return. Over the long-term, it certainly does. They key, though, is to minimize exposure to factors that would reduce this return. You can’t do anything about inflation, but you can take steps to reduce taxes and to avoid transaction fees.

Michael Fischer spent nine years at Goldman Sachs, advising some of the largest private banks, mutual fund companies and hedge funds in the world on investment choices. Look for more episodes of Saving and Investing at Get Rich Slowly every weekday during the month of April. For more information, visit Michael’s site, Saving and Investing, or purchase his book.

Jim Cramer: Dow Could Drop 2000 points

Jim Cramer: Dow Could Drop 2000 points

Yesterday Chris Matthews interviewed Mad Money's Jim Cramer.

http://www.msnbc.msn.com/id/21134540/vp/22734052#227340...

About 2 minutes, 50 seconds into the interview Jim Cramer says the following:

"The stimulus package doesn’t do anything. … But there is an element – there is something I would urge all our candidates to think about and our Treasury Secretary. Which is that there are a group of insurance companies that insure all these bad mortgages. And I think they’re all about to go belly up and that will cause the Dow Jones to decline 2,000 points. They’ve got to be shut down and the insurance given to a new resolution trust. This is going to happen in maybe two, three weeks. It’s going to be in the front of every paper and no one in Washington is even willing to admit it. … This is MBIA and Ambac. … Remember Merrill wrote down a lot of stuff the other day and Citigroup. All these companies are relying on insurance to save them. The insurers don’t have enough money. There is also personal mortgage insurance – PMI is a company that does it – MGIC. … If these companies do not have the capital to make good, when they do fall - and I believe it is when – if the government does not have a plan in action you will not be able to open the stock market when they collapse. … No one is even talking about it, other than the New York State’s Superintendent of Insurance. … I have not heard a single politician mention the fact that these major insurers, who have insured $450B of mortgages, are all about to go under."

Supporting Jim Cramer was an article in yesterday's Wall Street Journal - Default Fears Unnerve Markets By SUSAN PULLIAM and SERENA NG. They describe how these "insurance companies" work:

http://polecolaw.newsvine.com/_news/2008/01/18/1236330-default-fears-unnerve-market

"At the center of these concerns is a vast, barely regulated market in which banks, hedge funds and others trade insurance against debt defaults. This isn't like life insurance or homeowners' insurance, which states regulate closely. It consists of financial contracts called credit-default swaps, in which one party, for a price, assumes the risk that a bond or loan will go bad. This market is vast: about $45 trillion, a number comparable to all of the deposits in banks around the world. … If they default, everyone is supposed to settle up with each other, the way gamblers settle up with their bookies after a game."

It looks like we have a lot more to worry about than how to spend our $800 or $1600 dollars!

Wednesday, January 23, 2008

How market tops are formed

Q&A: Paul Desmond of Lowry's Reports

By Barry Ritholtz
RealMoney.com Contributor

2/18/2006 9:39 AM EST
Click here for more stories by Barry Ritholtz

Editor's Note: What follows is part I of Paul Desmond's interview with TheStreet.com contributor Barry Ritholtz. Tune in tomorrow for part II.

Paul Desmond, president of Lowry's Reports, is known as a "technician's technician." In 2002 he won the Charles H. Dow Award for excellence in the field of technical analysis for his studies on how market bottoms are formed.

More recently, he's been looking in the other direction, studying how market tops are formed. It has been a long time coming: Many years ago, Desmond's firm bought microfiche of The Wall Street Journal for 1920-1933. They laboriously converted the printed stock tables into digital form -- that's all market activity for every operating company stock listed in the stock tables, including the opening and closing prices and high and low volumes. From this unique data source, Desmond analyzed the 14 major market tops from 1929 to 2000, trying to identify similarities. His findings are startling and impressive.

Let's talk about bottoms a little bit because I recall reading a paper that you did that won the 2002 Charles Dow Market Technician Association award. The study on 90% downside days.

Yes. I had been reading a great deal of material about what market bottoms looked like. And one of the people that I happened to be reading was a fellow named of S. Gould, who talked about a classic market bottom in which he assumed it all occurred in a single day. That the volume was very heavy in the morning on the down side, that is stabilized in midday, and then by the afternoon, it was again rallying strongly again on substantially expanding volume. I simply went back through our history -- which extends back to 1933 -- and I was looking for those classic bottoms as Gould had defined them. I found very few, maybe one or two cases that fit his definition. But it became apparent to me that what he was talking about was an idealized situation and not actual experience.

So I went not only through his work, but through a number of other people's work where they were talking about what a market bottom looks like. I could not find any of them that really worked or fit preconceived notions. So we started looking for some pattern that would help us to identify a market bottom. We knew that the most important consideration of a market bottom was panic; the final step in a downtrend is that investors panic and throw in the towel. They want to abandon the stock market without any consideration of the value of their portfolios.

The classic expression is, just get me out, I don't care about the price, I gotta make the pain stop.

That's exactly right.

Looking at 1987, many people generally think that that was a one-day wonder to the downside -- that it was a one-day debacle. But I've looked at the month before and saw a big build-up in volume and a pretty hefty decrease in price before that single-day crash. How did you find 1987 to be, compared to other bottoms?

Well, the panic stages of it occurred in three particularly important days. The first one was on the 13th of October, a Wednesday. And then the 14th was a Thursday, and that was a 100-point downside day. Now at that point, a 100-point downside day then was something very spectacular. The 14th was a 100-point downside day on the Dow and it showed intensity, and that is where we had our major sell signal on the 14th for October. Then Friday the 15th, the market also dropped 100 points. So, to have two back-to-back 100-point downside days was pretty spectacular. Then on Monday morning, the 19th, the real crash, the 500-point drop, occurred. Now that was 90% downside day, which showed that there was real panic. (Editor's note: Lowry's defines a 90% downside day as a session with 90% downside volume in conjunction with 90% downside price action, meaning 90% (or more) of the price movement of all stocks on a given exchange is lower.)



I'm looking at a chart of October '87, and the Dow was about 2700 in the beginning of the month. Before we even got to that Wednesday (the 13th), the Dow was down to 2500. The volume really started ticking up on that 13th, 14th, 15th. The 19th and 20th were both the biggest-volume days of the selloff.

That's right. Actually, the interesting thing about 1987 is that most people incorrectly say 'it just came out of nowhere.' That the market was going up one day and suddenly crashed. And yet, we had a whole series of classic warning signs that the market was weakening. For example, the advance/decline line, which is a simple measurement of the number of stocks going up vs. the number of stocks going down, topped out in early April of 1987, showing that that was the point in which the largest bulk of stocks was starting to peak in price.

Our buying power index, which again is the measurement of the amount of buying enthusiasm present in the market, topped out in late March of 1987. From that point on, the market was still going higher but was doing so with less gas in the tank, so to speak. And also we run an index called the selling pressure index that measures the amount of selling activity present in the market in any given time, and that was in a strong uptrend pattern, particularly starting in early August. And during that last rally attempt -- the failed rally attempt in early September -- the buying power index was dropping at a very rapid pace and the selling pressure index was rising at a very rapid pace, showing that buying enthusiasm had really been lost and that the sellers were trying to dump stocks as quickly as they could. That all occurred almost two months ahead of the actual break in prices.

Not Your Father's NYSE

A question that has come up about your work is how are your buying power and selling pressure calculated. Is it proprietary, or is it something that anybody could find in the daily market data?

Well, it is proprietary in the sense that Coca-Cola is proprietary (laughs). In other words, you can look at a bottle of Coke and it will tell you exactly what the ingredients are, but they won't tell you how they cook it.

Without giving away the secret formula, what goes into your buying power and selling pressure indexes?

Well, the buying power index is a measurement of demand, based on the law of supply and demand. So the ingredients that go into it are upside volume and what we refer to as points gained. Points gained are simply a very simple calculation of the amount of price change in every stock that advances for the day.

And you only count operating companies, not closed-end funds? Or bond funds, REITs, things like that?

We do now. Back in the 1980s and so on, there were not the distortions in the listings on the New York Stock Exchange that there are today.

In fact, you recently said we should not be calling it the NY Stock Exchange. More than half of the companies actually aren't operating companies -- now NY 'Fund' Exchange is more like it.

Yeah, that is the thing that most investors are not aware of. That more than 52% of all the issues traded on the NYSE are not domestic common stocks. They are made up of closed-end bond funds. So those are issues that are actually bonds trading on the NYSE. There are real estate partnerships, REITs, a lot of ADRs and foreign stocks that don't necessarily represent our economy. For example, back in the days when the Japanese market was in an incredibly strong uptrend pattern, the ADRs such as Sony listed on the NYSE were creating quite a distortion, showing strength in our market that was really a reflection of strength of the Japanese market, rather than the U.S. market.

As we saw this tendency of the NYSE to list more and more issues that were really not domestic common stocks, we felt the need to create a series of computations that excluded all of the things that could be considered to be distortions. So what we run our analyses on is what we call our operating companies-only statistics. For that, we create upside volume, downside volume, points gained or lost, advances and declines, new highs and lows, and a whole series of other indicators as well.


It sounds somewhat similar to the Trin or Arms index, in a way, what you are actually looking at.

Well, the Trin Index or the Arms Index is based just on the advances and declines, and that index to my knowledge, the last time I talked to Dick Arms, was based on the traditional advance/decline numbers as are found in The Wall Street Journal that do include all of these potential distortions that I was talking about. So to my knowledge, Arms has not ever gone back and redone their indicators because of these things. In fact, the last time I talked to Dick about it, he said that he had done some studies and felt comfortable that the distortions were not significant enough to worry about.

But what we have seen in some instances -- one of the classic instances occurred in August of 2001, a few months before 9/11 -- in which stocks were in a relatively dull period, in which most stocks were just moving sideways, but all of a sudden, the advance/decline line began to rise sharply. And a number of analysts pointed to that sharp increase in the advance/decline line, and I think it was reflected as well in the Arms Index. They viewed that improvement in the advance/decline line as a sign of strength, a building up in the market ... that would clearly lead to a strong advance. But our operating companies-only advance/decline line at the same time was in a strong downtrend pattern, precisely the opposite direction of the conventional advance/decline line. So it was pretty clear that the difference between the two was primarily bond funds and foreign issues. But when we looked at foreign issues, foreign issues weren't doing anything particularly strong. So the improvement in the A/D line [at that time] was coming primarily from bonds -- and not from stocks.

Greed and Fear

You mentioned Japan: Do you look overseas? I have been bullish on the Japanese market for a couple of years, but I am starting to get a little concerned when I see these up 500-, down 500-type days. Is that a churning top? Is it something to watch? What are your thoughts on what has been going on with the Nikkei?

We don't watch them with the same degree of intensity that we concentrate on the U.S. markets. I have tried on several occasions in the past, dating back to the mid 1970s, when I first got the idea that it would be fun, if not profitable, to be a world-wide investor. In other words, when our markets were topping out, rather than going into defensive position into Treasury bills, wouldn't it be better to find some other market somewhere else in the world? At that time, in the mid-70s, there were very few investors who were really interested in foreign markets.

What we found was that the currency conversions created an incredibly complicated system for investors to keep track of. In other words, there were many cases in which you might have bought into a foreign market and made money in the market but when you tried to bring the currency back into our markets you ended up losing money. So we tended to stay away from the foreign markets because of the currency factor. But the new ETFs, exchanged traded funds that are all -- or a very large number of them -- are dollar-denominated, they make a wonderful way to watch foreign markets.

You are a pure technician, looking at market-derived data. Do you care about things like 'Are rates particularly low?' or what Goldman Sachs has called the Brics countries -- Brazil, Russia, India, China -- and their newfound demand? Did they change the calculus of bottoms or tops? Or is that just background noise?

Well, that's the interesting thing about it. On a fundamental basis, the fundamental factors are always different in every bull market or every bear market. But the technical factors are based upon something much simpler. They are based on human psychology.

Investors tend to go from periods of extreme depression at market bottoms, to extreme elation at market tops. And there are always a different set of circumstances that help boost that change in psychology. But the range of human psychology remains pretty much the same. And we simply move from panic at market bottoms, fear at market bottoms, and finally we move to greed at market tops. And that is the limit of what technical analysis is really doing -- measuring the psychology of investors regardless of events that may have inspired their bullishness or bearishness.

This is a good a point as any to transition away from talking about bottoms in general, and talking about tops. You recently did an analysis of 14 historical tops of the past century, ranging from 1929 until 2000. One of the things that I find pretty fascinating is the Nasdaq, which was really the dominate index of the 2000 crash, dropped about 78%. And the 1929 crash in the Dow was down a comparable amount. Before we specifically talk about identifying tops, I am curious, how would you compare the 2000 crash to the '29 crash?

Well there are always areas of extreme speculation in any market advance. In the '29 case, the equity market in the U.S. was much simpler, less complicated than it is today. The NYSE was by far the dominate exchange, the Amex was simply a shadow of the New York. All of the technology stocks at that time were listed on the New York Stock Exchange, stocks like RCA and so one. Now, the markets are more complex and we have several places that we have to look. The Amex, for a period of years, developed into what the Nasdaq is today. In other words, the Amex was a place where companies that couldn't qualify for listing on the NYSE went to register. And that is the way the Nasdaq really started out, as initial stocks were just getting off the ground. Now it is still the dominate area for micro-cap companies and therefore an area of extreme speculation.

Editor's note: Tune in tomorrow for part II of the interview, where Desmond discusses his theory that market tops, as well as bottoms, give very, very identifiable signals and offers his thoughts on the current environment.


Editor's note: In part I of Barry Ritholtz's interview with award-winning technician Paul Desmond of Lowry's Reports, Desmond discussed his research identifying market bottoms. Today, he talks about a more recent analytical paper that looks at how to identify market tops:

I just got an email from a friend who I had pinged before and mentioned I was speaking with you. He writes: 'Tell him I loved his early work with the Dave Brubeck Quartet.' I don't know how many times you've heard that joke.

(Laughing) Oh, many, many times, yeah.

OK, all kidding aside, let's talk a little more specifically about your most recent paper analyzing market tops. You've put forth the idea that markets at tops give very identifiable signals, that markets can be timed, that "buy-and-hold" really ignores a lot of information that comes at you. Is that a fair statement? .

Yes, it is very fair. I think the problem is there are an awful lot of investors who will say you can't time the market.

Well they are saying 'they' can't time the market. They're not saying 'you' can't time the market (laughs).

'They' can't time the market. And I think what they are doing is looking at fundamental information. And if you are looking at fundamental information, I think you are absolutely right. You cannot time the market off of fundamental information, because the stock market operates off of expectations as to what is going to happen six months or nine months down the road. In other words, investors don't buy stocks because of what they know today. They buy because of what they think they are going to know six months or nine months from now. So the market is always ahead of the economy. And as a result, if you are trying to look at fundamental information, you are always too late.

If you look at technical information, you can see signs of changes in investor psychology that are consistent from top to top. And that's what this study that we just did shows very clearly, is that there is an extremely repetitive pattern that occurs at major market tops, and that pattern is one of selectivity.

Meaning the market becomes increasingly narrow as it progresses?

Exactly. There is a process that goes on from day to day, when investors begin to run out of money. They've invested everything that they've got to invest, and therefore they are out of the game of buying stocks. At that point, they are simply holding, expecting the prices will go higher.

Let me ask you a question about that, though, because the counter argument would be: Well, people get paid every other week, and they are making contributions to 401(k)s and IRAs. These days, there is some $3 trillion in money market accounts. Do they ever truly run out of money or is it more a matter that the sentiment begins to shift?

Sure. Well it occurs at a whole series of different levels. For example, some investors simply invest everything they've got and they're out of money. Others will look at stocks and say, you know, I was enthusiastic about it when it was $20 but now it is $60, I'm not so enthusiastic. Others will say, my wife wants to take a vacation, so I have to spend the money on a vacation instead of investing in stocks.

Whatever the reasons are, the enthusiasm for continuing to put money into stocks begins to fade. And as it fades, the demand side of the equation diminishes, but the selling side begins to pick up, so sellers then are dominating in the market, and that is what tends to send prices down.

And this is not the way we tend to see bottoms, like a 90% downside day. Tops are really processes, while bottoms are a specific point?

Exactly. The major emotion that's present at a top is one of complacency, where people are fully invested in stocks, or are invested as far as they are going to get, but they are convinced that prices are going to keep going forever, and therefore they are willing to ignore the initial market declines that come along from time to time. As they say, they are 'in for the long term.'

At market bottoms, you have a completely different pattern in which the dominate emotion is fear and panic. And what we found at market bottoms, for example, was that in a typical major market bottom, you see a series of 90% downside days, 90% of all the volume, 90% of all the price changes are on the downside. Now the interesting thing that we found was that you can have a whole series of 90% downside days. During the 1973 and 1974 bear market, there were 15 90% downside days.

Over how long a period of time?

Over about 15 or 16 months.

So you don't necessarily buy the first 90% down day.

No. And that is the really critical point about market bottoms, is that you can have signs of panic-selling and it doesn't really mean anything. The only thing that will turn a market around and head it higher, is when buyers are wiling to step up to the plate and begin to buy.

The real signal of a major market bottom is to first see a series of 90% downside days, which say, investors are panicking, and in their panic, they are exhausting the desire to sell, because everybody that wanted to sell will have done it. But the key ingredient is to watch for a 90% upside day, indicating the prices have dropped low enough.

So you were saying the first 90% up day is a sign that sentiment has shifted dramatically.

That's right.

And is that a buy signal?

I think the history of this indicator shows that if you were to wait for a series of 90% downside days followed by a 90% upside day and bought after that 90% upside day had been recorded, typically you would be buying at major market bottoms.

Top of the Charts

Let's focus on the tops. We talked a little bit about breadth and we talked about how a top is a process, unlike the bottom being more or less a point. If investors are a little concerned, what should they specifically be looking for in order to see signs of a market top?

Well, if we were in the fall foliage season prior to winter, what we would tend to see in the trees up north, we'd start to see leaves dropping off the tree one at a time. And the stock market is very, very similar, that as you get into the latter stages of a bull market, individual stocks tend to peak out and begin to drop into their own individual bear markets, while there are still a lot of stocks continuing to advance.

As the bull market becomes more and more mature, a greater number of individual stocks tend to fall off the trees, so to speak, and drift to the ground, whereas the investment community is not watching the leaves, they are watching the indexes. They say, 'gee, the Dow Jones Industrial Average has made a new high today.'

Let's talk about that. You recently gave a presentation to a room of professionals where you asked them a series of questions. You were surprised by them, and they were surprised by what you told them. Would you talk about that?

Well, I had a group of professional portfolio managers that we were addressing, and I wanted to tell them about this new study that we had just done. And I asked them, 'What percentage of stocks would you expect would be making new highs at the top day of the bull market?' In other words, when the Dow Jones was making its absolute high, what percentage of stocks were also making new highs?

I asked, 'How about 80%?' and there were a lot of hands. Then I said, 'How about 70%?' and there were a slightly smaller number of hands. 'How about 60%?' and smaller number yet. And I think I took it down to about 50% or so.

And I said, 'would you believe 6%?' There was this complete silence in the room. Of the 14 major market tops, between 1929 and 2000, inclusive, when the Dow Jones Industrial Average reached its absolute peak, the average percentage of stocks also making new highs on that day was 5.98%.

How about within a few points of their highs?

Well we also looked at stocks within 2% or less of their highs. That number was 16.88% on average for these 14 occasions. Now those numbers range significantly, the lowest point was 6.23% up to a high of 22%. But that still meant that 80% of stocks were not making new highs at the same time the Dow Jones Industrial Average was at its high.

And you also point out that a significant number of stocks not only were not make making highs but had already dropped more than 20% from those highs.

Yes, that's right. On average, the number of stocks making new highs along with the Dow was 5.98%, but the number of stocks that were off 20% or more from their highs was almost 22%. And in the 2000 case -- which I thought was particularly interesting -- as the Dow Jones Industrial Average made its all-time high on Jan. 14, 2000, 55.33% of stocks were already off 20% or more from their highs. So that meant that the bear market had really started substantially before, at least many months before, the Dow Jones Industrial Average reached its peak.

Typically, I think most investors have a kind of a dream in the back of their minds that wouldn't it be a terrific trick to have sold out on the absolute top day of a bull market. The bragging rights from that would last a lifetime. But the actual facts are if you were to have sold out on the absolute top day of bull markets over the last 100 years, your portfolio would on average be off probably 10% or more and 20% to 22% of your portfolio would already be off 20% or more -- just as the Dow Jones Industrial Average was just reaching its peak.

Well, after 2000, I'll bet there were plenty of people who would be thrilled to be off only 10% or 20%, given the destruction we saw on the Nasdaq after that.

Absolutely.

So, it sounds like this is really a fascinating way not only to look for market tops, but to think about market tops. Meaning that, when the market is actually topping out by these narrow indexes -- be it the Dow, or the Nasdaq -- it really means that a lot of other stocks have already started to fall off the trees, as you suggested. And the highest profiled, best-known stocks are the ones that are continuing to go up, and that is reflected in both the breadth data and the new 52-week high data. Is that a fair way to describe it?

That is exactly right.

To an individual investor who may be reading this, is there an indicator they can follow? The dominant theme of the chatter seems to be pretty bullish lately. If people want to know if the market is in a topping process, what would you suggest they look at? Meaning, what would you advise someone's mother-in-law? When do they throw in the towel and wait for a sunnier day, to mix metaphors?

I think the first thing an investor has to do is realize that when the news gets so good, that it just can't get much better, that that is the time to look out, to be careful. Major market bottoms are always surrounded by enormous amount of bad news, and yet that is the right time to be buying.

You have to be willing to buy in the face of bad news. By the same token, at market tops, the news is dominated by good news, and that is the time to watch out because if the news can't get any better then all it can do is get worse.

How would you describe the news environment we are in? I thought the news was pretty cheery in the fourth quarter, but we have started to see some cracks in the facade this quarter.

Well, I think generally the news is pretty positive. People are convinced that the Feds are about to stop raising rates, the unemployment numbers are down substantially and the politicians are out promoting the idea that the economy is stronger than it has been for a long time. And generally the news is good.

Outside of the geopolitics out of Korea, or Iran, or Iraq, or Israel, or Russia or China, but domestically, you think generally the tenor is pretty positive. If that is the case, what are you seeing in terms of the advance/decline line? What are you seeing in terms of new 52-week highs at this point?

Well, number one, one of the things you want to watch as a long-term indicator is the number of stocks reaching new highs. And usually that is recorded in the paper as new 52-week highs. And that indicator reached its peak back in July of 2005 and has been diminishing since that time.

Now that is your proprietary operating company [list] , and not the full NYSE?

Yes, that is right. But even [with] the full list of NYSE-traded stocks, we show pretty much that same pattern. Distortions will come in periods like now where bonds are tending to be a little bit stronger than they were from time to time. But still even with the unadjusted numbers, the number of stocks making highs peaked quite some time ago, and each rally since then has tended to be a little weaker than the previous rally. So we made two peaks in January that were about 150 new highs per day, whereas those numbers in July of 2005 were in the 225 range. So you see they have dried up substantially and we think they are going to continue to do that. I was looking at [Tuesday's] data a little bit earlier, and whereas we had been running several hundred stocks making new highs per day, today we have 103.

As we are speaking [on Tuesday] , we are up 140 on the Dow. Are you suggesting, considering the strength of today's pop -- the Nasdaq is up over 1%, straight across the board, the NDX, the S&P, the Nasdaq, the Dow, they are all up over 1% -- that we are seeing a modest amount of 52-week highs, given that across-the-board strength?

Absolutely. Yes.

So according to your analysis of bull-market tops, where do you think we are in the cycle. Are we close to the top, getting near the top? Weeks or months away? What's your general take, without scaring the bejesus out of everybody?

We are well in the process of forming a top, but we are not to the final stage of this thing yet.

If we were to measure the final top, based on the Dow Jones Industrial Average, -- which is not the best way to judge a bull-market top -- it is very possible that the Dow has not made its final high yet.

This past week, we took a look at the Dow Jones Industrial Average stocks, the 30 component stocks of the Dow, and what we found was that there were, based on our way of analyzing individual stocks, three of the 30 stocks in strong uptrend patterns -- just 10%. And 20 out of the 30 stocks were in well-defined downtrend patterns. So you can see the selectivity that is present there, with 3 of the 30 stocks in uptrends, 20 in well-defined downtrends.

That same type of selectivity is occurring across the broad list [of stocks] as well. Not to the same extent, but it is occurring. And so we think that it is possible that the final highs in the major market averages have not occurred yet, but that a lot of individual stocks have already rolled over into their own bear markets.

Now investors generally don't buy the market averages, they buy individual stocks. So what we are telling people is that you have got to be watching your own individual stocks at this stage of an old bull market. What you should be doing is holding onto the strongest issues in a portfolio but culling out any stocks that are failing to participate in rallies. So for example, today, an investor ought to be going back through his portfolio and saying, 'Well, the Dow was up 140 points today, did my stocks participate?' And if they didn't, that might be a sign that for that individual stock, the bull market is at or near its end and greater caution should be taken in holding onto to those kinds of stocks.

Let me personalize this a little bit, [in] your own retirement account ... are you still primarily long? Have you moved to cash? What are you doing personally?

I tend to use ETFs more than individual stocks, because my job is to take care of my clients' portfolios rather than my own, and ETFs make it much simpler to manage portfolios. So I am still heavily invested in mid-cap stocks. Everything else, every other area, I have been out of for quite some time.

So I can assume you are not buying into, 'Hey, this is the year of the big-cap?'

Oh, no. We have heard that repeatedly.

Five years running.

But when we go through and look at the evidence of, is there any signs of actual buying enthusiasm present there, what we see is that investors are absolutely ignoring the call to go out and buy big-cap stocks. Investors simply are not moving in that area. And part of that is a reflection of what I just pointed out, with the weakness in the Dow Jones stocks.

Even on a plus-140 point day, you still see, based on the trends of the majority of the Dow, that they are not really looking particularly healthy?

No, they are not looking healthy at all.

Now, I know you don't do forecasting or make predictions. You think that sort of stuff is folly. But the question that I know people are going to ask me is, 'Well if Paul Desmond thinks we are in the process of topping, how much further is this going to go?' How much more time do we have to start culling individual names? Can this process take another year, or are we looking for significant trouble sometime in 2006?

Our expectation is for a sharp decline throughout most of 2006 that may well reach its low sometime around September of October.

The traditional months for those sorts of things.

Yes, those are just the most common months historically, more bottoms occur in the September-October period than at any other time.

I have Jeff Hirsch's Stock Trader's Almanac right on my desk, and they've looked at that data on a calendar basis, nine ways from Sunday, and most people think it is October. September seems to be pretty bad also. So, in terms of positioning, you would continue to stay with mid-caps until they show signs of rolling over.

Well, I think it is entirely possible that we are seeing the start of the rolling-over period now. In other words, this rally that's beginning here in the last two days, will be an important test of strength of this bull market. If the majority of mid-cap stocks do not get back to their highs along with the market averages, then that would be a sign that the mid-caps have started to rollover, and I would be anxious to cut back on my holdings of mid-caps at that point.

So is it safe to say, to go back to your ... New England metaphor: The leaves have already changed colors, we are starting to see leaves drop and it is a matter of time before they all hit the ground. Is that a fair way to describe where you are?

Yes, the important things for investors to realize is that market declines start out with complacency as being the most dominant emotion at that time. And the means that most people are half asleep, and they are just not paying attention. They don't think the markets can go down, so they don't think there is any need be watchful, but that is exactly when an investor needs to be particularly alert. The last stages of a decline, the very last couple of months of a market decline are the most intense, because that is when the panic sets in, and that is when it is absolutely essential that you are already out of the market. You surely don't want to go through that final stage.

So, I am trying to pin you down a little more as to where you think we are in this process. It is apparent that you are concerned and you are cautious and that you think the technicals and the market internals are implying that -- I don't want to say that we are in the ninth inning -- but is it safe to say that we are late in the cyclical bull market within a broader secular bear market, or do you not make that distinction?

I don't make that distinction. I think that those terms tend to block an investor from really clearly seeing what is going on.

I prefer to just concentrate on the idea that about every four years on average we have a setback in the market that typically last for anywhere from nine to 11 months, and prices typically drop in excess of 20% on average. I think that is the major thing to concentrate on. Investors simply have to go back through history and realize there is a very consistent pattern of market bottoms about every four years. You can go back and see, for example, there was a major bottom in '49, '53, '57, '62, '66, '70, '74, '78, '82, '87...

'87 missed by a year, but...

What a miss. Then '90, '94, '98, 2002 and that would lead us four years later to another major bottom in 2006. And I think the consistency of that over many, many, many years simply says that there is a cycle to the stock market, much like the cycle of weather. Every year has a summer and a winter to it. And we are used to that and we adjust to it. At the same time, the stock market has a cycle to it that is about very four years and investors need to realize that that cycle exists and to accept it and adapt to it.

People seem to have a hard time looking at cycles that are longer than they are used to. The day and night cycle ... the full moon, even the seasons are the type of cyclicality that humans very easily conceptualize. But thinking about four years, unless you are talking about presidential elections or Olympics, people don't really think that sort of cycle applies to the stock market.

Well, that is where the old saying comes from: Those who fail to learn from history are doomed to repeat it.

Paul, that is the ultimate point to stop on. Thank you very much for your time.