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Equity Prices Test Lows, But Fear Is Far from Its Highs

Or it may be that the vast amount of currently known negative news is already greatly reflected in the price of stocks, that investors are aware that the news will continue to be bad, and that it will take a major negative surprise in the financial markets to knock prices down further. What might that negative surprise be? GM bankrutcy, a much worse than expected unemployment number, the failure of two or more European banks of significant size on the same day, a sovereign nation defaulting on its debt, a currency crisis (eg. the Euro or the Swiss Franc) or the downgrading of soveriegn debt of several European countries by two or more debt rating agencies.

Credit Crisis Watch: Some Positive Developments

The improvement is modestly significant but may prove to be temporary. It reflects the tremendous liquidity being pumped into the system by almost every central bank in the world as well as the fact that investors are becoming more comfortable with the risks that they currently are familiar with.

However, that could change in a hurry. Many countries in Europe are deteriorating rapidly. Several countries may default on their foreign debts. Protests, thus far fairly civil, have occurred in Iceland, Latvia, Bulgaria and France, yet news reports of civil unrest are barely referenced on the left-biased prime networks on this side of the pond.

We all are aware of the problems created by Wall Street greed and brain dead policy decisions by Congress and the Bush administration. What we don't know is the sheer magnitude of the globabl debt problem. Thus far, the worst credits have been exposed; however, unemployment is rising alarmingly fast and some credits that would be secure in most recessionary environments could quickly assume a higher risk profile over the coming months.

The improvement in credit market liquidity could reverse in a hurry.

Task Force for the Middle Class: Is Obama Kidding?

Its a lose-lose situation either way - the way the current Obama administration wants to do it or the way you would like to see it done. However, while your approach would be more effective, it would sure hurt like hell.

This is the problem with those whose political beliefs favor the left side of the spectrum. These ignorant fools think they, through their superior intellect, can capture the beneficial aspects of capitalism and can avoid its natural correcting mechanisms. In their attemps to avoid or delay the pain, they only make the situation worse when the unavoidable eventually occurs. Then they rail against the failures of capitalism when capitalism is functioning the way it must. Our govenrment is comprised mostly of lawyer politicians who obviously never took a basic economics course.

The Cult of Peter Schiff - Is It Deserved?

I am very partial to Mr. Schiff's economic views. However, I have read where his accounts did very poorly in 2008. To be so right on so many economic predictions, and so wrong on his investment decisions shows a definite lack of experience in the discipline of money management. I would have no problem opening an account at his firm but I would have a real problem letting him manage the money.

The Heretics of Finance

Technical analysis is about timing the market. Everyone, without exception, who invests in stocks times the market. Most professional money managers will tell potential clients that they don't time the market, but of course, they do even if they truly believe that they don't. Whenever they buy a stock, for whatever reason, they are saying "I want to own that stock now, at this time". Similarly, when they sell a stock, for whatever reason, they are if fact saying, "I do not want to own that stock at this time". Why buy a stock now? Why not yesterday, why not tomorrow? Why not next week or next month? The same with sells. Why now? Has something changed? Even if it has, it has changed in time. So if an investor finally comes to a realization that, like it or not, he is timing the market, then he may as well try to acquire a skill for it. Studying technical analytical techniques can provide that skill.

Why I Bought Morningstar - One of My Favorite Stocks

Why own a stock at all in this hostile and deteriorating environment?

More Signs of Our Broken Market

The rally is light volume and it's technical. However, a heck of an Obama relief rally cannot be ruled out. It will be a shorting opportunity but that opportunity may come from higher levels, as much as 1500 DJIA points or more. The greatest stock market rallies occur during bear markets.

Why fool around with options? Use inverse ETFs. The upside isn't as great bit if you use the leveraged ones, it is still substantial and there are no time premium and no expiration date concerns.