Paulson has uniquely understood the malaise which US economy is facing......
Fed also has FINALLY come to grip with the cause of US & world economic challenges.....
Worldwide there is a serious effort to deal with "frozen liquidity issue"
Hundreds of billions is being pumped to "LIQUEFY"....
US,Europe,Canada are @ the forefront of pumping hundreds of billions into monetary system of their economies.....
So.....
After 13 months of downward spiral in economic picture.......which has brought DOWN worldwide growth by several notch.......we are starting to REVERSE & AVOID even WORSE contraction......
Stock market worldwide was predicting an economic collapse which shorts with their WISE strategy capitalized big time.....
Shorts & hedge funds followed the TAPE & scored BIG.......
In HINDSIGHT I do NOT blame the shorts @ all......they could SEE clearly the fragile balance sheet of many investment bankers like BSC,LEH,MER,MS,WM,ABK,FNM,FRE...& went to town in shorting & LAUGHED all the way to the bank.....
Smart traders always capitalize on opportunities...Short or Long......
I personally was always of the opinion that as long as I do NOT have financials & housing...I should do OK......
BUT.....that was NOT the case......as SHORTS capitalized on the negative sentiments and shorted the dickens out of every good stocks which had high growth of earnings and sales...they were ALL hitting NEAR yearly LOWS........
So that was the story UPTIL NOW.........
BUT.......
Things are CHANGING in a HURRY.......
SO....How next 13 months will fare...should be in FOCUS.......
IF......
Everything goes according to the $700 billion package......
We are looking @ Stocks & Markets MUCH MUCH MUCH higher........
As you have noticed that Markets moved UP in a hurry.....How high have Dow gone UP in 2 trading days.....an eye popping 984.64 points on Dow or 9.46%.......
Those who are NOT FULLY invested near LOWS ...always MISS the biggest moves......
So.....
If you have not capitalized on this CHANGING picture.....it is NOT too late......
We have just started the move UP.......
SO.....have a DIFFERENT strategy of trading/investing .....
NOW...you need a BULL market strategy......
What IS a bull market strategy???
-OPTIMIZE your dollar invested
-$100,000 invested in one stock MAY NOT be a good strategy....
-$100,000 invested in 10 stocks IS a great strategy.....
-Do NOT go for stocks which have declining Sales & EPS/NO EPS.....
-Go for stocks with fast growing Sales/EPS......
-Also if you put $100,000 in $100 stocks ...it MAY NOT give you the % moves which IS possible @ this stage of the market......
So it is back to Fundamental analysis.......
In my humble OPINION...technically STRONG stocks MAY NOT give you the returns as LAGGARDS will OUTPERFORM....with GOOD growth potential in Sales /EPS......
So you want to know ...How high will be DOW in 13 months...my GUESS we will be higher than 14,280.....which IS 2,892 points HIGHER or a whopping +25.39%......all MY OPINION of course.
Please do your OWN due diligence & manage your risk based on your OWN comfort level.
There are winners & losers in every market conditions...as we REFUSE to CHANGE our strategy with the TAPE......
BLOG does NOT give buy or sell.
Saleem
13 comments:
Hi Saleem,
Nice blog today. Very optimistic picture indeed. We do need a turn around soon. Bear markets don't last forever and with the helping hand of the SEC we may start to drift north through the elections and holidays.
Is NYX a buy here or wait for a pullback?
Best Regards
Hi Standards,
NYX is a "screaming buy".....
NYX has made a 2 year straight downhill tape.......
Now it wants to turn UP,UP & UP....
Saleem
Saleem, I see you bought VMW, will it ever see its high like 100+ or even 80?
Hi Troy,
Nice to see your note after a long time.
VMW has a very good chance of seeing $50.....
It use to be my extremely profitable trade after IPO....
They are improving their product lineup.....incorporating cloud.
VMW will be a very good long term hold.
Are you still holding VMW?
Saleem
Hi Saleem,
I see you have noted RIMM as technically weak - are you going to hold through earnings or do you think it is wise to unload? News of a new phone - the Storm is out - prelim reports say it is a touchscreen that is much faster than the iphone...
Thanks,
AD
Hi Ad,
I sold RIMM on friday with a small gain $2.50 per share.
Too much money was tied up and next Q MAY be challenging.
I put the same fund in FXI...wich in my opinion may work out better.
You should follow RIMM based on your own interpretation of its fundamentals.
I am just switching funds around for optimization.
Saleem
Stocks Set For A New 10 Year Bull Run From Monday Sept. 22 2008( Strong buy: WB,BAC,JPM, ETFC, SUN; Hold:WM, RIMM, AAPL, DELL, POT)
(Sept. 20, 2008, 8:10PM ET)
Since we have stock exchanges inherited from Holland in 13th century, we have had bull and bear market periodically. In the last few decades of US history, Every 10 years, we have a bull run in the stocks, this usually came after one or a few historical events/decisions. Such as the great depression, the government rolled out huge intervention, and the economy boomed eventually, of course stocks zoomed up during the same period; In the 1980s, ten commercial banks failed. On April 28, 1980, the FDIC, the Federal Reserve, and the OCC jointly announced a $500 million open bank assistance package to assure the viability and continued operation of First Pennsylvania Bank, N.A., (First Penn), a subsidiary of First Pennsylvania Corporation, Philadelphia, Pennsylvania. First Penn, with assets of $8 billion, was Philadelphia’s largest bank and the twenty-third largest in the nation. The assistance to First Penn was in the form of $500 million in five-year subordinated notes supplemented by a $1 billion bank line of credit through access to the Federal Reserve discount window. The Resolution Trust Corporation (RTC) set up to solve the savings and loans crisis, again stock market started a bull run until the DOT com bubble burst in 2000.
Now we have the similar crisis, banks don't trust each other, money is not flowing in our system. The government steps in and puts the stock market in the bottom, for many of investors, it is a once in a lifetime opportunity.... read more...
HELLO all
The AAPLE chart is awsome just take a look it indicated upward momentum.
Monanto has huge earning and will not disapoint
GS should now go higher that financial news is good!
DSX and FRO want to go higher as shipping rates are going higher.
I am NOT sure about my VISA --it seemed week last week, ig it holds $71 we may get back to the $80 and if we hold $80 then we should get to $120
It is all just MHO, Do not forget the oil plays htey are due a 10% run up here as they have been crushed and oil is above $106 again.
Peace to all and Good Luck
Hi all,
China has dropped it's tax on stock purchases. A small tax, but its says they are in the mood to help out the market also.
Good Hunting.
Hi Standards,
World is in a mood to bolster investors confidence.....
Even small steps will be a giant leap to build confidence in markets.
Saleem
HELLO
Gas price in DC is$3.49 Lowest yet
Market want to go green but my GS and HAL are my greens so far
I am looking at oils---XTO, PWE, UPL, HAL, CHK for nat gas play
Hi C,
Markets worldwide are on very sound footing.....
China was UP huge !!!
Buy whatever you KNOW & comfortable with.
Saleem
Hi C,
Gas prices in ATL $4+ holding steady. Gas stations closing pumps saying they have no gas to sell. Hmmmmmmmm.
Some profit taking today. With Oil moving up maybe we can make a buck with SOL.
Clear sky's ahead.
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