JDN - I am even on my December S&P 500 put, and up 45% on my March put. I plan to sell the December on Monday, and buy a second March.
My interpretation of what I read on the macroeconomic side of issues indicates that the slide in equities is not nearly over. I would not be surprised to see some equity upside between now and the first of the year, although I would be amazed to see any kind of a strong rally between now and then. After the first of the year, I think things will get really rough as Q4 early warning season begins, GDP continues to cool, winter heating bills really start to impact consumer confidence, inflation pressure gradually increases, and because the FED will not be able to lower interest rates, liquidity will continue to tighten.
Cisco Systems will effect tech stocks and even the overall market this week, but I doubt that there is anything they can possibly say that will have any lasting positive impact.
Very interesting article in "Barron's" today about the typical impact of lower liquidity on equities by Joseph Carson, chief economist for the Americas at UBS Warburg. The title: "Liquidity and Markets: This Time It's Different - this autumn, unlike '98, money flows are down - and are making a bearish call."
Another thing that bothers me is the almost unanimous sell-side view presented by CNBC. A lot of individual investors are going to get scorched by paying too much attention to television and not reading enough.
Could I be wrong about this - you bet I could. As usual however, I make buying and selling decisions on my own analysis. It has worked for over four years - I'm not giving up now.
I am expecting a big increase in Abiomed's stock price before January 1, as soon as they submit the request (called an FDE) to the FDA to begin clinical trials. If they should not submit the IDE before December 31, the stock will be in trouble - however, I do not think that will happen. Jan & I have bet big on this company - wish us well.
Ken Wilson
Disclaimer: The above is my personal opinion. I recommend that you do not base your investment decisions solely on any one person's views or analysis (including mine). Do your own research and take personal responsibility for your investment decisions. |
