jmmx

Three Stocks Positioned for a Downtrend

You say:
"Emotion may often drive the markets up, but sanity eventually prevails"

I like this. It is certainly a statement that we should all keep in mind. For the astute investor it is the key to making money if one can only accurately gauge when a stock is over- bought/sold.

There is one potential little fly in the ointment of your argument. What if instead of the current rise being emotional and irrational, it is in fact a correction of the emotional over-reaction of the market and its previous state as grossly oversold. This would actually be an understandable - almost inevitable state - given (1) the emotional impact of the financial collapse, and (2) the need for so many institutional investors to unwind over-leveraged positions.

Just a thought.

(Of course there are always individual stocks that do not reflect the current market state so this does not apply to any particular picks.)

Three Stocks Positioned for a Downtrend

I may be simplistic in my analysis (and overly optimistic to boot), but it seems to me that the Obama administration, along with most of the developed nations, will be moving ahead very aggressively on solar energy. In this case, the overall world wide demand will be so great that all major players - including FSLR - will have a piece of the pie. While they may loose some of their cost advantage, there are a few factors to keep in mind:

1- If demand picks up, then shortages will drive up all prices.
2- If demand picks up, then silicon prices will rise somewhat. (Yes, I know that capacity has increased, but still...)
3- As an American firm they will have some preference in the U.S.
4- FSLR is not run by dummies. I am sure that they are not standing still while others are advancing.

So - I would not count them out of the long term picture.