Like A Christmas Carol on Wall Street, the gift of life in equities this holiday season occurred despite the fiscal Scrooges. Many economists and portfolio managers were expecting a recession in 1986, yet in late '85, stock averages began one of the most vigorous uplegs in modern history. It's no surprise that such naysayers as Eliot Janeway and Joseph Granville were contradicted by the DJI's pursuit of 1600. What was exceptional was the move's strength. No longer responding to a sector at a time, money-supply statistics, or takeovers, the rally's inclusiveness was refreshing. Even the Tiny Tim of this tale -- the INC. 100 -- was transported. Its performance suggests that stocks were strong not because of low interest rates, but because there is plenty of cash around. And surplus capital keeps things interesting.
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