Financials

I know I am beating a dead horse but I was just reading some numbers and the financials sector is just on a life support machine.The sector is down a whopping 26% in January and there is no bottom in site. Top of the list of losers were Fifth third, SunTrust, Bank of America, Capital One, Citibank and Wells Fargo. I think if you own bank stocks here period you are foolish and a matter of fact if you own any stock here for other than a bounce you are going to get your head handed to you.
There is also major trouble in insurance industry. Warren Buffet bet on the insurance industry is now down a whopping $14 BILLION. Man oh man Berkshire Hathaway shares were at high as $150,000 in 2007 and now @ $80,000. Even the richest in the world are making dumb moves here on wishful thinking.
Many people will be surprised when we trade in the DOW 6000 area but you have been warned it wont end there. There is too much optimism out there still for me to believe the bottom in this market is even close and lets be real we have had almost a decade of bullish action, do you really think the bear market will just last a year!!!!
Also interesting reading about troubles in China and how the chinese might start selling US dollar treasuries and buy gold as a move to alleviate the pressure of the US crisis on their government books. My thoughts on this is not so much buying of the gold versus the US dollar but the chinese will be redeeming our debt as theie will be a short fall in their exports, therefor will be looking to raise cash for their continued expansion. You all know what I think will happen when this scenario plays out, just bad bad for us, our grandchildren might still be paying off this debt at this rate or we will see very high inflation in the future, either way it is not a good scenario.
I hope we find a way to get off oil from the middle east as this will help tremendously in the future as we wont we spending our dollars on increased commodity prices.
Last week I said the market looks so heavy so lets see how they want to play the first few days of February, if we go into the mid March time frame without an significant lift higher forget about it for the rest of the year, this year might be alot worse in performance than 2008.

Here and now the S&P line in the sand is 785, if we lose that the next stop November 2008 lows


MARKETJEDI