I think at this point the fall in the market is driven entirely by fears about credit, and that fear just feeds off itself. I don't see a bottom yet.
There is no reason to believe the cat has bounced or it is on a cliff edge and we haven't seen a real drop yet. Totally uncharted waters. There is no reason to believe the volatile up and down free fall will not stop until say Spring of 2010. There are two many bombs set to go off and the tools to defuse them are gone.
What is the Fed going to do when the other shoe drops and the ten trillion dollar debt starts hyper inflating? Can they lower rates? Sorry, already at 1%. The only thing they can do is print more money which they will do but double digit inflation has to happen. There is no other way to get out of a ten trillion dollar debt. You have to make it worth less than it is. This is something Shooshie has pointed out for years and it will happen. Unless your income is tied to inflation hold onto your hats. A 14 % raise will mean you are back pedaling. Sucks but do you have to be over 50 to remember inflation? 70's and stagflation will look like a picnic compared to honest to god hyper inflation.
The US savior is a new economy. Biotechnology, stem cell, nanosphere, nanotechnology, green tech, solar, wind. Start buying stock in IPOs with MIT scientists on the board and nano something in the name. It will be like buying Polaroid in 1950. Stay away from ethanol, biofuel.
It won't take long. Six years and we will be laughing about all the money we wasted buying oil to fuel cars. The nanosphere batteries will be 700 bucks a fill up but flipping burgers at Mickey D's will be $650 an hour.
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