Wednesday, October 22, 2008

When is this gonna stop?

I can't believe the economy! We all knew we're in the middle of a 'recession'. Not that I feel any difference though. Highways are as crowded as ever, people seem to be working and even doing overtime everywhere I go, food is on the table, so, WTF? Fine. Recession been going on and on for months since almost a year. Companies started to report earnings for the September quarter and it doesn't look good. Fine. Tell me something I haven't heard. Few banks were about to file for Chapter 11 but only a handful did manage it effectively and the rest have been rescued by their governments who have thrown in trillions of dollars! Cool! Now, have you recently looked at the stock valuations of most of the NYSE healthy bluechips following the recent roller-coasters since this last September? Microsoft is less than it was ten years ago! C'm on! Microsoft for crying out loud! Toyota is less than half of what it was ten months ago! Google same story. GE even worse. Citigroup is only 12 bucks worth. I mean... when is this going to stop?

By any measure, everything seems terribly oversold! There are no buyers and there are only shortsellers, looking for a piece of negative news to push their target stocks even deeper! I don't understand. Oil heads for the mid 60's as we speak (at least this is a good piece of news). When the stock market was going down gold was going up. Not now though. Gold is almost 30% off its highs earlier in the year. Bonds are going down too. Only the dollar appreciates vis-a-vis the euro and that's great as well, other than US products (think Apple) are bound to get more expensive in the near future. In any case, the market movements defy every logic possible. It's like everything is imploding! Oh, yeah... I forgot. VIX is going up again!

No comments: