This is due to professional are selling at these level !
Monday, September 22, 2008
10:45 am - Market Outlook by Bill Wermine !
Dear Traders,
Five years ago Warren Buffet called CDS (credit default swaps) financial weapons of mass distruction. He directed his insurance arm of Berkshire Hathaway (BKK) to exit the business. The gut wrenching turmoil in the credit markets this week proved that Buffet was right. The collapse of Bear Sterns, the sale of Merrill Lynch to Bank of America, bankruptcy of Lehman Brothers, and the meltdown of AIG were all related to CDS that led to the fall of these financial giants. AIG received an emergency $85 billion loan from the Federal Reserve on 16 Sept to stave off bankruptcy and prevent a nuclear explosion in the CDS market and a possible world wide financial panic.
This is leverage in reverse and the government was forced to step in to meet the margin call. The US taxpayers are now on the hook for over USD 3890 for each man woman and child. The government will monitize this debt by printing money . That is why you should be out of the US Dollar and into Gold and commodities.
CDS profit when housing prices go up and as long as the house buyers pay their mortages, the sellers make a killing. Unfortunately, the US is in a major recession with massive job losses, factories closing, auto sales in a collapse, roaring inflation and over 10 % of Americans are in default or behind in their house payments.
The US Governement can not take care of their returning disabled Iraq war veterans many of whom live on the streets. The government tries to cover this up and deny it but the public seems to be getting smarter so Obama has a chance to win. If he does expect the US Dollar to collapse and our plantation shares/Man Hedge Fund to go up
(check out http://www.intrade.com/ ) This is a bookmaker in Ireland wher you can place bets on anything including the US election. This is real time real money. Today Obama took a big jump and is now leading McCain.
I like the AUD - (Our AUD Man funds were up 2.8 % last week recovering a bit from the August loss). Plantation companies should also perform but avoid banks, construction and property companies, REITs, bonds, and deal in only the highest quality blue chip consumer shares with dividends.
We have had massive selling of Plantation shares as Crude Palm Oil has lost half its value in the last 6 months. - Everyone is bearish. Last week CPO
hit a monthly support and bounced over 200 points. Plantation shares were up across the board over 10 %. Tom Williams of TradeGuider calls this pushing through supply. It is important to look at monthly and weekly charts to gain a better view. The palm oil charts are definitely positive as professionals load up in this pessimistic and fearful environment. There is strong evidence of hidden potential buying.
How do we navigate this financial storm and avoid going down with the ship like Captain Smith in the Titanic?
Consider Man Investments- new capital guaranteed fund to launch on 29 September. This can be your financial lifeboat. Learn to trade on line- Jupiter Securities offers the cheapest commissions in Malaysia - only .05 or RM 8 + clearing fees. Those graduates of our Master the Markets/TradeGuder users are equipped to making quick profits even in this environment. For the more adventurous try the CI and CPO futures. Give Martin a call on this. He is looking for 2 more futures brokers and will train you.
Five years ago Warren Buffet called CDS (credit default swaps) financial weapons of mass distruction. He directed his insurance arm of Berkshire Hathaway (BKK) to exit the business. The gut wrenching turmoil in the credit markets this week proved that Buffet was right. The collapse of Bear Sterns, the sale of Merrill Lynch to Bank of America, bankruptcy of Lehman Brothers, and the meltdown of AIG were all related to CDS that led to the fall of these financial giants. AIG received an emergency $85 billion loan from the Federal Reserve on 16 Sept to stave off bankruptcy and prevent a nuclear explosion in the CDS market and a possible world wide financial panic.
This is leverage in reverse and the government was forced to step in to meet the margin call. The US taxpayers are now on the hook for over USD 3890 for each man woman and child. The government will monitize this debt by printing money . That is why you should be out of the US Dollar and into Gold and commodities.
CDS profit when housing prices go up and as long as the house buyers pay their mortages, the sellers make a killing. Unfortunately, the US is in a major recession with massive job losses, factories closing, auto sales in a collapse, roaring inflation and over 10 % of Americans are in default or behind in their house payments.
The US Governement can not take care of their returning disabled Iraq war veterans many of whom live on the streets. The government tries to cover this up and deny it but the public seems to be getting smarter so Obama has a chance to win. If he does expect the US Dollar to collapse and our plantation shares/Man Hedge Fund to go up
(check out http://www.intrade.com/ ) This is a bookmaker in Ireland wher you can place bets on anything including the US election. This is real time real money. Today Obama took a big jump and is now leading McCain.
I like the AUD - (Our AUD Man funds were up 2.8 % last week recovering a bit from the August loss). Plantation companies should also perform but avoid banks, construction and property companies, REITs, bonds, and deal in only the highest quality blue chip consumer shares with dividends.
We have had massive selling of Plantation shares as Crude Palm Oil has lost half its value in the last 6 months. - Everyone is bearish. Last week CPO
hit a monthly support and bounced over 200 points. Plantation shares were up across the board over 10 %. Tom Williams of TradeGuider calls this pushing through supply. It is important to look at monthly and weekly charts to gain a better view. The palm oil charts are definitely positive as professionals load up in this pessimistic and fearful environment. There is strong evidence of hidden potential buying.
How do we navigate this financial storm and avoid going down with the ship like Captain Smith in the Titanic?
Consider Man Investments- new capital guaranteed fund to launch on 29 September. This can be your financial lifeboat. Learn to trade on line- Jupiter Securities offers the cheapest commissions in Malaysia - only .05 or RM 8 + clearing fees. Those graduates of our Master the Markets/TradeGuder users are equipped to making quick profits even in this environment. For the more adventurous try the CI and CPO futures. Give Martin a call on this. He is looking for 2 more futures brokers and will train you.
Hold on to you hat for a wild ride next week
Bill
10:22 am - Time to get rid of your stocks in your portfolio
If there is a time to get out now, this is it.
Sell on any rebound of KLCI. A lot of counters like Bursa is showing potential hidden selling or upthrust.
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