Stock Trader Man

Dow Jones down 100 @ 7365(rallied 100 of its lows on the White House saying they support private banks)

CRB Index down 2.8 @ 144.2

Copper down 2.6 @ $144.2( The PhD in economic forecasting is stuck in a range so telling us nothing…for the moment!)

Gold up $17 @ $994.0 (Hit my target of $1,000 and took profit from longs at $905)

Oil down .15 @ $40.03

SPI up 3

THE HINDSIGHT

On Friday the world’s 3 wisest and most respected men all spoke from the same page.Firstly, George Soros who manages $21 bln said “The world’s financial system has disintegrated and we are facing something more severe than the Great Depression and there is no sign of a bottom.” He blamed”Reaganomics” of the 1980’s for implementing financial deregulation which has now has culminated in the end of  free market capitalism…hey, George, Ronnie was only following what others told him.

Paul Volcker, the most successful Fed Governor ever and now Obama’s chief advisor said the same as Soros regarding the state of the economy. This 6 foot 10 giant also believes in letting companies go belly up regardless of their size, he certainly believes the U.S banks should be allowed to go their own way.To add more weight and despair Ex’ Fed’ Governor Greenspan earlier said we are a long way from any recovery and things can only get worse.

Senate Banking Chairman Chris Dodd also said some U.S banks will “have to be nationalised  for a short time at least”…er, what Chris? a couple of days, months, years, centuries?These comments saw Citibank trade under $2, yep 2 bucks…I almost(almost) feel sorrow for the Saudi’s who 2 years ago were paying around $80 a share.

Despite White House denials and saying “we still believe in the private banking system” the market is practically convinced nationalisation will happen;then throw in the collapsing East European banks and possibly even countries and all those ramifications and it isn’t rocket science to avoid the bank shares.Even Australian banks, particularly NAB who have huge U.K exposure owning Clydesdale Bank(Scotland’s biggest bank) and Yorkshire bank.

President Obama plans to cut the deficit by $533 by the end of his term. The cuts will come from higher taxes, less spending in Iraq(that saves about $400 mln a week) and cutting back on Government programmes.He is obviously trying to tell us he is prudent and aware of the potential problems of a ballooning deficit but to say that right here , right now isn’t going to help.There are just too many mixed signals coming from the Government and markets abhor uncertainty….even as I speak the OZ $ is selling off on this news. I still remain short Oz $ at 64 cents. The open interest on the futures exchange rose from 5,848 contracts to 7,290 over the week indicating the market believes it’s a winning trade.

THE FORESIGHT

On Friday we recommended a company called Ceramic Fuel Cell(code CFU) via our website www.trendinvest.com.au at around 8 cents.The shares closed at 13 cents having hit a high 0f 16.5 cents.I certainly believe there is enormous potential for this over-looked stock in an industry which is the next major growth story; energy preservation and fuel efficiency. CFU is in partnerships with all the major world utility companies and is the world leader on reducing emissions and designing units which save 60% of electricity. Not being a scientist the details are better covered by a visit to their website at www.cfcl.com , it certainly makes for very positive reading and in particular view the CEO’s statement made in January where  he says a  5% market penetration would generate 1 bln Euros per year and that isn’t relying on government contracts. It is a “must have” for any portfolio going into the industry which is seeing universal commitments made by Governments and companies for the need to be more energy efficient.If you’re a “greeny”then so much the better!

Please view our other website at www.trendinvest.com.au for more trading ideas.

Have a great day!

QUOTE OF THE DAY: “We will be paying $3bln in bonuses to retain our broking staff.” Spokesperson for Morgan Stanley…defies belief!