Harry Dent, of HS Dent Investments, alerts investors to possible changes in financial markets as of August 10, 2009.
We may be seeing signs of a modest panic back in from institutional investors. Lowrys is showing recent rises in buying power after it had fallen to very weak levels which made the rally look questionable. Now more new money may be flowing in from investors on the sidelines as we expected…
This is something that we’ve heard about for the last couple of months. There are billions of dollars on the ‘sidelines’ and institutions have been waiting to move back into the markets. Many fund managers make their commissions based on what they earn for their clients, and those who have sat out thus far, in cash, won’t be bringing in any massive numbers. Perhaps they feel that the new economic numbers are showing an end to the recession and the emergence of a new bull market.
Harry Dent, however, continues to warn investors, as he has for the last three months, that July was probably a good time to sell any stock market positions and exit the market:
If the markets continue to edge up into early September then it will make more sense for aggressive and growth investors to simply short the S&P 500 or another broad index to play on a very likely second crash from September or so into late 2010.
The fact is, that while our economic numbers may have stopped collapsing, they are still abyssmal. And the fact that unemployment will continue to rise and credit lending will continue to decline, is not going to help ‘restart’ spending as the Fed, Treasury and Obama administration claim. A crash is coming and most SHTFplan readers know this. The stock market is the last place one should be right now, unless of course you are holding some short positions.