The US was spanked Friday by of all people ..S&P. Now S&P are the same people that rated CDO's, remember those AAA investments that plunged to $0 in 2008? Although the markets were starting to build in the possible downgrade, the actuality of the downgrade certainly still cast a pall on Wall Street yesterday. But give the devil its due, this downgrade finally awoke the politicians who spent this country to a level seen only by the likes of Greece, Ireland, Iceland and Japan. Belgium and France, two countries that cannot seem to pony up their fair share of NATO costs etc, are now rated superior to the US by S&P. Now I don't know about you but I would not consider countries that cannot even defend their own borders, as safe financial bets, but what do I know.
The stock and commodity markets responded well to the downgrade by losing almost 5% in one day. The DOW experienced its 6th largest loss ever, Oil lost 7% in one day and off course GOLD bucked the trend as investors believe we will be paying for milk with gold bars soon. Well Virginia there is a Santa Claus and yesterday's investors gift wrapped your present. Of course you will have to go out there and get it but it is there. For those who are not familiar with Virginia, GO BUY EQUITIES NOW! Remember when the DOW hit 6666? you said "I should have bought Ford (NYSE:F)", next time. Well investors this is one of those times.
The Pick of the day, month.....YHOO! Yahoo, Prophet you have been hit with one two many sun spots you say. Well, the stock is at $10.96 as of yesterday's close and the value of its Chinese and other Asian holdings are estimated to be worth $18.00 alone. Mr. Softee ( NASDAQ: MSFT) already offered over 3x that amount 3 years ago and YHOO wisely rejected the offer so that they could make small fortunes out of large ones. Microsoft may just scoop this one up with petty cash, sell off Asian properties and have the search engine for the grand sum of $0.00, yes that is ZERO. We are looking for a $20.00 bid from several interested buzzards. Of course do your own due diligence.
Well we saw the double dip threat in March and now it is here. The economy is on life support and politics currently do not favor business. We will be looking for ideas to buck these trends and keep you up to date. The crystal ball has been working overtime, need to let it cool off. Until it does good investing and remember that you never lose by taking a PROFIT!
The Prophet
No comments:
Post a Comment