Thursday, June 14, 2007


The bulls took control today and lifted the indices substantially higher. Even higher inflation readings and increasing 10 yr bond yields could not dent the bulls .

I will be back later for a more indepth recap and look at todays market. I'm off to a lunch meeting.


The Dow, Nasdaq and S&P all closed up today and it appears a bottom has made made. There is a chance the indices will face resistance at its previous highs and in the case of the S&P strong resistance exists at the 1540-1550 level. Oil, recreational and mining were among the winning sectors today while brewers, real estate and mortgage related were the big losers. Among individual stocks, HOKU IAX LUNA CLWR BRLC AZC KRY were the biggest gainers while SAT HBP DECC CMRO MPP were among the biggest losers.

Adobe beat after hours but the stock is down as Q3 outlook came below consensus. ADBE is a great long term stock though if I were to buy I would wait for it to come down 15-20%. It is a little pricey at a PE just under 50.

A Bear Stearns hedge fund liquidated about $4 Billion of subprime mortgage backed securities after sustaining losses. Who was buying is what I would like to know. Buying subprime CDOs is worth the risk if they can be purchased for substantially under market value.

Late mortgage payments and foreclosures across the nation are up exponentially. California,Florida, Nevada and Arizona were the worst hit. These 4 states though are probably the best places to go find distressed real estate. Once this crisis has passed, these 4 states will have the fastest real estate appreciation. People who invested in California in the early 90s could have sold out by 2005 at 4-5 times the purchase price. Not bad for an investment that one can purchase with 5% down.

Memories of my days clubbing across Europe in the 90s. This was probably the most played song in clubs from Amsterdam to Paris to Frankfurt to Barcelona. Good times......

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