Yikes
The market is collapsing. If you bought the put suggestions that I offered, good for you. You doubled your money in 1 day.
It's tough being long in this current market. I don't think the market is oversold. I did expect this week to have a bit of a dead-cat bounce, so the rapid collapse is surprising. Also, with earnings coming out, I expected some consolidation.
I look at Intel and ATT and see some telling stories. ATT announced yesterday that they are facing a rash of unpaid cable and phone accounts. That is consistent with the belt-tightening I have predicted for so long. What is interesting is the tone of ATT's announcement - they defensively protest that they will hit earnings. Intel hit the same notes last week when they announced that they will hit numbers thanks to global demand. It echoes Cisco's own earnings release protests that all is fine.
Investors are saying that they don't care about this quarter - they care about the next few quarters. If ATT is showing signs of weakness, then won't that affect capital spending plans and hiring plans? And that's how recessions start - with consumer spending slowdowns that lead to industrial investment slowdowns.
And every day the drumbeat of negativity continues. Today it was GRMN.
The stocks in the portfolio should be immune from long term US recessionary trends. But I am still stunned by the collapse of WFR, FWLT and others. All of these stocks are what I call undervalued growth stocks: PEGs <1,>30%, not dependent on US market. I think a few solid earnings announcements will reverse the market's pessimism towards all stocks and reward the true growth stocks.
It's tough being long in this current market. I don't think the market is oversold. I did expect this week to have a bit of a dead-cat bounce, so the rapid collapse is surprising. Also, with earnings coming out, I expected some consolidation.
I look at Intel and ATT and see some telling stories. ATT announced yesterday that they are facing a rash of unpaid cable and phone accounts. That is consistent with the belt-tightening I have predicted for so long. What is interesting is the tone of ATT's announcement - they defensively protest that they will hit earnings. Intel hit the same notes last week when they announced that they will hit numbers thanks to global demand. It echoes Cisco's own earnings release protests that all is fine.
Investors are saying that they don't care about this quarter - they care about the next few quarters. If ATT is showing signs of weakness, then won't that affect capital spending plans and hiring plans? And that's how recessions start - with consumer spending slowdowns that lead to industrial investment slowdowns.
And every day the drumbeat of negativity continues. Today it was GRMN.
The stocks in the portfolio should be immune from long term US recessionary trends. But I am still stunned by the collapse of WFR, FWLT and others. All of these stocks are what I call undervalued growth stocks: PEGs <1,>30%, not dependent on US market. I think a few solid earnings announcements will reverse the market's pessimism towards all stocks and reward the true growth stocks.
posted by Andrew at
6:21 AM
1 Comments:
Yep, it really sucks, I was on the sidelines too! Too bad, I missed it, didnt expect such a downfall, I was expecting this after Jan end :(. Oh! well..next time :(
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