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.
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Lots of chatter about this on the internet – especially when you google “september bank holiday”. Could this be a self-fulfilling prophecy?
i have been reading the same, all over, on various web sites unrelated to eachother.
Bob Chapman over at International Forecaster had a post about 3 -4 weeks back that his sources are saying that the US has sent shit tons of foreign currency to embassies around the world supposedly expecting a dollar devaluation. The embassies have denied this.
It seems to me that “everything is all right” as of right now, so something crazy would need to happen in order for a bank holiday to actually take place, no?ÂÂ
Perhaps a swift and significant crash and loss of confidence in the financial system could do that? It is not out of the question for a market crash to shave off 30% – 50% in a week or two, which may be an event that could potentially cause a bank holiday, I guess. If confidence is lost in the banks, people may run ’em, and they would have to shut them down to prevent total collapse.
The only thing we can do right now would be to have a 1 – 2 month cushion in cash to pay rent, bills, etc. in case the SHTF in this respect.
If there is actually a bank holiday, that would be nuts! Then all of us crazy SHTFers and doom & gloomers would actually be right — and that is probably not a good thing!
Yeah…this is what makes me check Google Finance first thing every morning…
As AS indicated, I’ve read a ton of stuff on the internet (like Denninger and ZeroHedge) about this – really since the rally began after the market lows in March.
Maybe I’ve already mentioned this here, but if not, here is a podcast on the Disciplined Investor with Mish and Tyler Durden:
http://www.thedisciplinedinvestor.com/blog/2009/04/26/tdi-podcast-106-zerohedge-and-mish-o-nomics/
That was my first exposure to ZeroHedge – if I remember correctly, even way back in April, Durden was warning “something is wrong here…”
He also was the first person I heard (in that podcast) who suggested that high frequency (quant) trading was severely distorting the market.
Denninger has mentioned several times how ridiculous the P/E ratio is right now…
I also find Peter Schiff’s comments (many posted here) interesting…he seems to agree that another storm is brewing in the stock market – BUT any “crash” could simply be relative to the dollar.
If the dollar index did something crazy, like drop to 50 or something, who cares if the Dow stays up around 9k…your money in it (like your money in the bank) gets sliced up anyway.
…or am I over simplifying that?
The psychology behind it all is fascinating. I say that because everyone seemed to “know” that we were in serious trouble last summer/fall. However, the lows didn’t hit until March. I don’t understand that at all.
For now, I’ll keep flipping my coin I guess.
I haven’t listened to that DI podcast with Mish and ZH recently, but the one thing i took away from it was a comment by zero hedge when discussing Long and Short positions in the market. his comment was :
“Expect Massive Losses”
didn’t matter which way you were holding, HFT would tear you up.
Check out Howard Katz’s recent article posted here on SHTF at https://www.shtfplan.com/howard-katz/something-for-nothing_08102009 .
According to this article, the dollar is toast, and I agree. Perhaps we will see a small rebound in the event of a crash and all, as money moves into short-term treasuries from around the world, but the trend here is DOWN.
Let’s say it moves DOWN from this point forward… is it possible that we can still have a crash? This would be a break in the recent inverse correlation of the dollar andequities/commodities, but can it happen?
Total confidence loss in, BOTH, the public and private sectors in the US?
Man, that would be nutz… Nothing is out of the realm of possibility for me at this point.
September should be an interesting month.
Note: this is 80 years since the big ‘un in 1929… The end of Martin Armstrong’s 80 year cycle.
We live in interesting times, folks.
Mac
I listened to Harry Dent’s vedio and I read his book “The Great Depression Ahead”. I don’t believe this year we can have another crisis again. September is passed half, where is the problem? Dow and Nasdq, SP500 are zooming up again! Everything is getting better, even if it is not perfect. I think his timing may need to postpone.
Valid point Goldragon… it looks like Q3 GDP will show growth, and perhaps even Q4. All the news out there right now is being interpreted as positive. not a good sign for us doom and gloomers. 🙂
nonetheless, the fundamentals are shot and I believe that by the end of 2010, Americans will know the real deal.
By 2015 we’ll be screaming “uncle”.
This is going to play out over the course of the next decade, in my humble opinion.