Sell NOW! Market Comments May 26 2009


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  1. RobertH
    Posted 27 May, 2009 at 11:15 am | Permalink

    Sell now?
    The ones that took your advice have already sold on levels 50% under this one…

  2. Farmann
    Posted 27 May, 2009 at 11:46 am | Permalink

    Robert – well, you are wrong about that.
    I told everyone to sell in November 2007 and then again in January 2008.
    That was way way way higher than even now.

  3. Ric
    Posted 27 May, 2009 at 1:25 pm | Permalink

    Look,some may think Hans Lysglimt is extreme when he says “sell now.” Yes, and some are technically correct when they ask why since they have reinvested in the market since March 09 and have made a considerable sum. The problem is that many individuals do not know what is really going on nor understand to what extreme governments have gone to prop up the financial system. There is enormous collusion going on in all the asset classes, from stocks to bonds and even to currencies between the various central banks and the investment bankers who through tax payer and fiat money which have no substance behind them because a) the taxpayer is grossly overburdened and could never on their own generate that level of productivity in such a short time to produce the real money ( currency) via productive labor to offset the fiat money ( currency) the central banks have done out of thin air. From nothing comes nothing even though for a time you can get away with it. Real mony can only come from real labor( productivity) and that is scarce now because labor is contracing at a rapid pace. and b) the global pool of capital has been so destructed that the governments cannot replace it own its own strength without risking hyperinflation adn the total destruction of credit. Look at the United Kingdom with debt to GDP ratio at (past) critical level and the impact on credit rating and future ability to borrow. The U.S. is right behind and though the whole money machine in the U.S. will work furiously to give the illusion that this will not happen to the U.S. it is pure mathmatics, not speculation, that debt to GDP ratio reaches 80% in a few short years. How is it possible that the largest economy will go unscathed fromt this credit to debt conundrum. It will not and the markets will be very punishing to all asset classes very soon. For example, in the U.S. investors are buying anything that has yield, like municipal bonds and so called junk bonds in a frenzy to get yield. Yet, the credit analysts and even largest portfolio managers are telling people they expect default rates to rise dramatically, even has high as 40% on junk bonds. Are stocks immune? No. Stocks are based off earnings and inflation expectations. Earnings are collapsing and inflation expectations are rising dramatically dur to the new debt bubble the FED and other central banks are creating. Now is the time for preservation of capital. Yes, there are short waves within long ones and that is all we have seen now since March. A short wave in a very long down cycle. If you are a professional investor and you are very nimble and now how to protect youself fine then a short term position is okay. But if you are the type so sit and look at a postion and you are not dexterious and have no technical trading capabilities this is the worst time for you. You will lose capital at an astounding rate. This must happen because it is the fuel for the fake fire they have produced in the global financial markets since March. They can only fan the flames for so long but then it will have to be extinguished because there is no real capital behind the move only fiat central bank play money, like the Monopoly game children play. Do you know the move in that board game, “Go to Jail?” and that you cannot get out until many rolls of the dice pass you by and sometimes you never get out?

  4. RobertH
    Posted 27 May, 2009 at 1:28 pm | Permalink

    Ic, that was a good call.
    Why don`t you create a “paper portfolio” so that the readers can see your track record?

  5. Ric
    Posted 27 May, 2009 at 9:06 pm | Permalink

    Excuse my vulgarity, but it is time to vomit. GM is about to declare bankruptcy, the Federal Reserve cannot control long term USD interest rates, investors are buying USD credit bonds for yield despite the underlying credit risk ( which is rising to default in many cases), equities are grossly overvalued due to miserable earnings and fiat currency created inflation in the pipeline. I believe Farmann is correct: all asset classes are about to collapse in value, beginning with the USD asset classes. Hold on to your hat!

  6. Jan N
    Posted 30 May, 2009 at 8:29 pm | Permalink

    Titanic’s sinking – The orchestra’s still playing (…what else is there to do?)