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Richard Russell

Market analyst takes the long view on Wall Street

Richard Russell started his career of giving financial advice by losing money.

After the World War II, Russell followed his family's footsteps, investing in the stock market. He lost money at first, but after more than 50 years studying the market, he is now a source of advice for more than 10,000 subscribers of his Dow Theory Letters.

Published every three weeks, the Letters contain the La Jolla resident's thoughts on recent market activity.

Kelly Wright, managing editor of San Diego-based Investment Quality Trends, speaks highly of Russell.

"Whether people agree with him or not, they certainly pay attention to him," Wright said. "He's the dean. His level of wisdom and experience ... no one out there writes like he does and I don't think anyone out there analyzes like he does."

Russell writes about the twists and turns of the stock market and stays true to the basic theories of Wall Street's original analysts, while adapting to technology and the expanding economic world.

He focuses most of his attention nowadays on the Web site, where analysis of market news is updated each weekday, along with stories about his family and memories of his service as a Air Force bombardier in WWII.

"I think he's the master of the 30,000-foot view," Wright said. "He has an innate ability to step back and see the big picture and put in context. I think that's just invaluable."

In the mid-'50s, Russell started sending his thoughts on the market to friends. Somehow, Russell said, an editor at Barron's Magazine found the writings and started publishing articles. Soon, he had 300 subscribers -- enough to leave his job at a textile design company.

Russell started the Letters in 1958 and hasn't missed a single issue. It's the longest series of financial commentary continuously written by one person. Subscribers have ranged from the Bank of China to big-name brokers such as Goldman Sachs (NYSE: GS), to a priest in a leper colony in Africa.

Russell uses his own "Primary Trends Index," or PTI, which he developed in the early 1970s and still posts for subscribers every day. Reflecting Russell's bare-bones philosophy, the PTI analyzes deep undercurrents in the market, looking strictly at market action without any emotion or subjectivity.

"Wall Street goes in fads," he said. "They get one indicator and everyone starts using it. I wanted something outside the fad."

His knowledge of the market has led him to some big calls. He called the top of the 1949-1966 bull market. In 1974, when "everyone" was bearish, Russell said he saw the Transports didn't break to new lows and decided the market was headed back up, calling the bottom almost to the day.

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