Second guessing can be expensive

As I sat to the sidelines and watched investors buy in with great enthusiasm on Monday September 8, after the bail out of Freddie and Fannie, I wept rivers of tears. Already so many investors have had their fingers burnt but again they put their hands in the fire.

But I also cried some tears because I thought those names would be dead and buried. With such names they almost deserve to go under (the names not the poor mortgage owners). Hopefully the USA government will make the momentous decision to re-christen these monster mortgage companies with sensible names.

And as I write I see the DOW is now up 164 points on the sale of Lehman Bros. Now guys over there in the world of Uncle Sam just settle down. Not only are you gyrating needlessly but you are confusing the living daylights out of investors world wide.

Why not just take it easy? Haven’t you heard of the saying ‘slowly slowly catch ye monkey’. Is there a prize for picking the absolute bottom of the market? We know that you cannot interfere artificially with markets as they find their own level regardless. So stop it.

All things point to us being close to the bottom of this market rout and as JJ says below we need to get ourselves into gear as if we don’t we are going to miss the next big move. Just take a look at my projection for the next couple of years:

click to enlarge

Make sure you are on board.

Enjoy the ride

Tom Scollon
Chief Analyst