Tuesday, October 28, 2008

Where are we in the Financial Markets...

I hate to say this, but the retail investor or "everyday consumer" has been giving many signals or signs that we are in alot of pain with respects to the Financial Markets. And as a result, there has been a tremendous amount of capital taken out of the market with the closing out of many funds, stocks, positions, etc....

When you look at all the global markets, they are down at least 40% this year as investors seem to have resigned to the fact that there is a global economic slowdown. With this resignation I am here to shed some light on some positive outlooks:

-Governments are reacting to these market reactions and are putting their best foot forward to try and accomodate the current environment. Is it the right entrance and stance...that is for another day.

-Commodity Prices are waaaaaaaay down

-Warren Buffett and some other high flying investors are really putting some large amounts of capital behind some top American brands. With that said, this is a very positive inflow of capital, but keep in mind..investors such as Warren are receiving some pretty efficient warrant positions that are "in the money" at the time of their investment, so the downside risk for these large institutional investors is not as great as you may think initially.

-Historical Perspective to Pay Close Attention To: The S&P trades 25% below its 50-day moving average, which has happened just five times since 1928, all resulting in a rally.

As a result of this metric, look for cash rich companies like Mosaic, Microsoft, Citibank, and Wells Fargo!

Thats all for today folks! See you tomorrow!

VentureGuy

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