Word: market
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Dates: during 1980-1989
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...approval process, the FDA relies on a generic-drug manufacturer's in-house lab tests to establish a product's effectiveness. But the temptation for the manufacturer to cut corners can be strong, since the first companies to gain approval are likely to carve out the largest market shares...
...even as investors take comfort in sound fundamentals, they look with alarm at the return of the greedy speculation and electronic sorcery that are blamed for the crash. The market has reacted with near hysteria to the possibility of takeovers, first in the communications industry in response to the Time-Warner deal and now in the airline business in the wake of bids for the companies that own Northwest and United Airlines. The takeover-stock mania has coincided with the return of program trading, a system in which brokerage houses use computers to buy and sell giant blocks of stock...
...fact, has been at the back of the thundering herd of market indexes, partly because it is made up of blue-chip issues favored by relatively conservative investors. Broader market indexes including Standard & Poor's 500 and the Wilshire 5,000 had already reached all-time record levels by early August. Says Justin Mamis, chief strategist for the investment firm Cowen & Co.: "All the Dow can do now is put the lipstick on." The allure of stocks is broadening rapidly as more and more investors join the stampede, which is demonstrated by the big increase in the market's volume...
Some analysts are encouraged that investors have been going back into the market slowly and cautiously, in comparison with the mob scene in mid-1987, which made everyone skittish and panic-prone. That is not the mood this time around -- at least, not yet -- and markets rarely hit their peak until all types of stocks are overbought, professionals become exuberant, and even small investors are snapping up stocks with abandon. Peter Lynch, manager of Fidelity's $11.5 billion Magellan mutual fund, recalls that "in the summer of 1987, torrents of cash were coming at us out of money-market funds...
...most of the stock buying has been done by corporations through stock-repurchase programs, mergers, leveraged buyouts or employee-stock- ownership plans. All told, such buybacks have reduced the supply of shares on the market by a record $94 billion during the first half of the year, or nearly 4% of all outstanding stock. The buyout of RJR Nabisco alone took $25 billion worth of stock off the market, while the acquisition of Warner Communications by Time Inc. will reduce supply by another $14 billion...