The Nightmare On Wall Street Continues

Energy and Gold sub indices are showing positive signs

A very steep down week with the TSX Composite losing 6 per cent. All sub indices fell on the week. Despite the down week both the Energy and Gold sub indices are showing positive signs. On the other hand the Financial sub index continues to trade near resistance and has still not really demonstrated to us that it should be bought. The Metals and Mining sub index has taken it in the ear again but now stands at major support. Others though that set new lows such as Information Technology and Healthcare just look awful and should absolutely be avoided.

The TSX Venture Exchange (CDNX) while down on the week continues to show us some positive signs. Many of these stocks are so beat up that we are seeing some basing going on. We continue to believe that this group can be selectively accumulated. [read more…]

THE NIGHTMARE ON WALL STREET CONTINUES

Fear treads unchartered turf – Toronto Star, Business section, September 27, 2008

Last week we were looking for the Maalox. We are now out of it. For years, we, along with many others, warned how the growing mountain of debt, coupled with unparalleled growth in
derivatives and complex products, would wind up in a massive debt collapse. Of course we were
for the most part considered charlatans, doomsayers or worse. Only occasionally did the
mainstream financial press point out essentially the same, even if it was on the back page. Now it is upon us and the creators of this mess are caught like deer in the headlights.

Watching Henry Paulson, Ben Bernanke and George W. Bush look and act like dead men
walking is a sight to behold. On August 8, 2007, at the start of this crisis, President Bush declared “the economy is strong,” repeating it several times in the same speech. Then on September 15, 2008, he said the same thing, adding that troubled Wall Street shouldn’t expect any more rescues from Washington. At the same Paulson said that “what we are going through in the short term doesn’t make anything easier, but in the longer term it’s going to make things better….” Bernanke often recited the same mantra.[read more…]