<<Ron <<signs of a major market peak>> its outside the scope of
your newsletter than deals with metals and other natural resources,
but if this USA stock market is a bubble that can be popped by either
Greenspan or simply under its own over pressure, can you present any
possible tell tale signs that a crash is soon, as in weeks or days ?
<<its outside the scope of your newsletter>>>>
Doug, sorry for the slow response, with holidays and trying to
keep up with regualr e-mail etc have not been on SI much,
but my newsletter has regular commentary on US and
Cdn equity markets and N American/global economies
and also presents a US and Cdn model portfolio.
These portfolios are basically set as long term investment portfolios,
with suggested weightings:
3% silver bullion
2% gold bullion
10% RSA newsletter resource picks
10% other newsletter, Future Tech Picks
5% speculations, short positions, options etc.
The remaining 70% is divided up into stocks, bonds, particular mutual
funds and cash.
Basically I have suggested a defensive to bearish stance in
the past 1 1/2 years. I do not believe much in playing the
stock market through blue chips, senior stocks or mutual
funds. The market is too tough and too risky under present
circumstances. I have suggested using Spyders 'SPY' these
follow the S&P 500 index and trade huge volume. Even huge
investors can move in and out of these on a daily basis if
desired. Spyders have and will beat most portfolios,
especially since the market rise has been so narrow. Also
there is no load fee or management fees like mutual funds so
I believe they are better than equity mutual funds.
For the Canadian portfolio, I am using TIPS, 'TIP' these
follow the TSE 35 index
My yearly outlook in February was for the best time in
equities in the 1st half of the year and a rough time in the
2nd half. So far the markets have gone this route. This year
we have been in and out of the 'SPY' and 'TIP' a couple times
and have been totally out of the equity market for about 1-2
months. Have gone to cash and a short position with the
Prudent Bear Fund, and recently about 30% to 35%
cash into bonds.
<<can you present any possible tell tale signs that a crash
is soon, as in weeks or days>>
The short answer is 'no'. I am talking a 1 or 2 day drop of
15% to 30% as a crash. Crashes are about imposible to
predict because they are always caused by an unforseen event
and that is why it surprises the market and the crash
happens.
However there is many signs that point to an overvalued
market, that is prone to a crash or severe sell off. There
is also some danger signals currently flashing that could
cause a major correction.
I could go on a lot about market over valuation, but I think
most accept the market is overvalued.
Near term, China has lowered interest rates below $US rates
to try and get out of deflation and depression. This will
put a lot of pressure for China to devalue their currency, a
move that could trigger anther round of Asia turmoil
South America, Brazil devalued, Columbia is going through
the wringer now and Argentina is under pressure, a
South/Central America currency problem could trigger a US
equity sell off/crash.
On July 21st I sent an udate to subscribers on the market and
the danger signs flashing. You can few it at my web site for
all the details. We also went long with Barrick Call options
that have worked out perfectly so far.
sentex.net
Ron |
