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djn21
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First off, I view the entire monetary and financial system as something of a Ponzi scheme. Starting with currency that is debt, and running straight though a global economic model that is based on a premise of infinite growth in a finite world. This won't end well. I'd go a step further and... More
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New Power Media
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Playing the Ponzi
  • Rally is unsustainable 0 comments
    Jul 23, 2009 1:17 PM | about stocks: CEAI, PUDA, LTUS
     

     

    I am of the belief that the current rally is unsustainable.  I don't know when a downturn will come, but I suspect it will be somewhat dramatic.  I suspect that Fed liquidity is trying to find a decent return and is pushing the markets higher.  I think within the next year, the current stimilus will be proven to have failed and new systemic problems will arise.  I don't anticipate a true "bottom" until 2011. 

     

    That said, this much liquidity will create a bubble SOMEWHERE.  I do believe something will rise (probably dramatically in price) as all that liquidity chases return from somewhere.  It'll me pretty entertaining to see how it plays out.

     

    I have made my living trading Chinese micro-caps for the last few years, and still like that as an area of focus.  Valuation remain very good and growth remains pretty strong.  They are nice, tradeable positions with a lot of volatility.  The space works perfectly for the limited amount of money that I want to invest.  Currently, I hold CEU, JGBO, LTUS and PUDC.  That said, I cycle through these pretty quickly and have held a wide variety of different stocks in that sector.  I do like those 4 though, and only CEU is on a major exchange, so I look forward to JGBO's uplisting and PUDC uplisting after a reverse split.  LTUS has a trailing P/E of under 2 and some nice growth prospects in its pipeline, so I don't mind holding that for years.

     

    I remain heavily overweighted in cash for the moment, though I am consider various options (outside of equity) as a home for it.

    Themes: CHINA, MICRO-CAP Stocks: CEAI, PUDA, LTUS
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