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Technology Stocks : Semi Equipment Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Return to Sender who wrote (54870)	12/12/2011 1:18:24 PM
From: Jacob Snyder	4 Recommendations Read Replies (2) \| Respond to of 95420

<But what if we are wrong? Would it not have been smarter to at least book some profits on that KLIC short and reshort again at what are now higher levels?> Obviously (but obvious to me only in retrospect) I made a mistake not covering my shorts back in early October. In August and September, SPX had been in a horizontal trading range, and I thought we were breaking below that range in early October. Instead, the horizontal pattern was re-established. All year, there has been no sustained up- or down-trend, just a volatile sideways motion, and I should have continued to trade the range. For 2012, I see a continuation of 2011. Corporate profits are very good, corporate balance sheets are also very good, and should justify higher stock valuations, if (big if) there are no shocking macro issues in 2012. Unfortunately, none of the macro issues of 2011 have been resolved: 1. Europe, U.S., and Japan governments have not balanced their budgets, and it is wishful thinking to believe they will until a much bigger crisis (bigger than 2008) happens. 2. Oil prices remain high. The LT inverse correlation between stock and energy prices will continue, implying the secular bear market continues until renewable energy gets cheap. 3. Food prices remain at record levels. The world's poorest 2 billion people will continue to be hungry, angry, and desperate. This implies more of what we saw in Tunisia and Egypt. The next revolution will be in Pakistan, Mexico, or Nigeria (2 oil producers and 1 nuclear power). 4. Jobs and wages are stagnant. They didn't go up, when corporate profits rebounded, so it is wishful thinking to believe they will go up in 2012 either. The unemployment rate is going down, because people are leaving the work force and adjusting to much lower consumption levels. Any increase in consumer spending simply results in higher debt levels. 5. Housing prices may have troughed, but there is no rebound. Middle-class wealth is in housing assets, not stocks. The middle class is in the process of adjusting to being permanently poorer. I'm guessing SPX 2012 range of 1300-1000, and I'll wait to cover my shorts will we're at the lower end of that range.