The market seems to be selling-off on the back of limited bad news imo, apart from the dollar that is.

If you can hold your nerve and apart from any short term requirements to offload poor performing stocks, I have a couple!!, my advice would be sit tight. This does not have the feel of the tech(mining!) bubble at all. Difference being there are a lot of good fundamentals, unlike in 2000 when there were a lot of over rated nothing companies.

The City: Is the Party Over?

Tuesday 22 January 2008 9:00-9:45 (Radio 4 FM)

Repeated: Tuesday 22 January 2008 21:30-21:58 (Radio 4 FM)

Greg Wood reports on the effect of the credit crunch on the City. From the trading floors of Canary Wharf to the private equity Houses of the West End, he hears tales of fear, greed and the most serious convulsion to hit the City in a generation as bonuses are cancelled and jobs cut. Is the party over for one of Britain's major industries, and is the rest of the nation going to have to pick up the bill?

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They don't seem to interested on the Traders side about these informative radio programmes, so thought I'd put this on here as well.

Don't you just love it? ;-))))

Having just re-read the Classic book . The Zulu Princible / Jim Slater I will below show his three stages off a bear market, and look back over the last year to try and find if the picture fits.

Stage 1 = Usually a sharp fall during which economic conditions remain positive.

February 2007 FED says US economy looking good with stable slowdown and falling inflation. Two days at the end of the month we have a sharp 2 day fall, FTSE 100 has a 5% fall. Started by a 15% fall on Chinese stock market.

August 2007 Sharp fall in FTSE 100 which falls from mid July high of 6730 to 16 August low of 5858 a 13% fall. Main reasons were the credit crunch and worrying signs in the US economy.

Stage 2 = Economic conditions deteriorate, markets become over sold- then a sucker rally. With most investors believing the market has bottomed.

September/October 2007 All markets rise with FTSE 100 gaining 15%, from 16 August low of 5858 to end of September high of 6751. Commodity stocks led the way with Chinese economy sucking raw materials.

Stage 3 = Economic news becomes awful. Investors panic and sell at any price, market declines very sharply.

November 2007 to Now Credit crunch and sub prime concerns re-surface, sub prime write offs increase. Economic news becomes worse, and the only hope to keep markets up is interest cuts. The FTSE 100 is 18 % lower from November price of 6700 to 22 January low of 5520.

Not all bear markets are the same, but I think all 3 stages are identified in the last year. And this does feel like a bear market with short rallies. For what it's worth I believe/hope the US could still avoid a recession, and lead us upwards for a few years at least.

To be honest there is no point in making predictions at this time, just be careful and take profits when you see them.

"For what it's worth I believe/hope the US could still avoid a recession, and lead us upwards for a few years at least."..always worries me when I see the words "believe and hope" in the same sentence -):

you see very similar words in most threads concerning spivvy E&P companies like MRP!

I would think all traders would (hope) that the US can avoid recession, and would be happier returning to more normal market conditions. Even though we are seeing some good trading oppotunities in the present climate.

Must admit I did add the word hope in as an afterthought.

Makes me feel a bit better about my recent fooul-ups, mind you he wasn't betting his own money!
Rogue trader costs French bank 3.7bn
Thu 24 Jan 2008

LONDON (SHARECAST) - A single trader has cost French banking giant Societe Generale 4.9bn, or 3.7bn, in a Nick Leeson-style fraud.

France's second-largest bank was cagey about the enormous loss, but said the Paris-based employee is in the process of being dismissed.

The unidentified member of staff, thought to be part of the companys equity trading division, built up positions using futures linked to European stock indexes which went badly wrong.

All positions have now been closed, said the bank, which admitted to uncovering the fraud on January 19 and 20.

The huge losses dwarf the 725m gambled away by the infamous "Rogue Trader" Nick Leeson, which led to the collapse of Barings Bank in 1995.

It was an extra blow for SocGen, which also announced writedowns related to the sub-prime mortgage crisis of over 2bn, or 1.5bn.

The bank said it will have to raise 5.5bn (4.1bn) by selling shares in a rights issue underwritten by JPMorgan Chase and Morgan Stanley in order to maintain capital its ratios.

An offer of resignation from chairman and chief executive Daniel Bouton has been rejected by the board.

Losses of between 600m and 800m will be reported for 2007, said the group whose shares are currently suspended on Euronext.

at the end of the day a good share is a good share, hopefully paying real and rising dividends. Many say investing (not trading) should be for the long term, so in 5 years time this will just be just blip (well, maybe a bit bigger than blip, A BLOPP maybe.)

Worth a read :


http://www.bloomberg.com/apps/news?pid=20601039&sid=akcLU5Y7iJN0&refer=home


.

chirpy little article isn't it!

Somebody just lost 3.5billion today. Is he Nick Leeson's apprentice?

By the sound of it ,he did a much better job than Nick Leeson !!

With bad news from Soc Gen I see most UK banks are leading the way up 8 to 9, imagine if we had some good news. Very strange.

Yes, yes, yes, I hear all the informed opinion about rates, crises, commodity and property values.
I understand the drop in equity prices and the way the USA looks bankrupt.
I can even follow the rougue trader bit and understand why that might cos the odd problem, and why UK Plc is heading towards a recession.
But nobody has addressed the real problems that always go with a UK recession.
History teaches us that when the economy goes bad, hem lines fall and skirts get long and dowdy.
I can cope with the redundancy, the inflation, the repossessions and watching my investments tumble like a russian gymnast, but the skirt thing is the last straw.
Please tell me that skirts will buck the trend this time.

not many know that correlation, though i think it is true ...... can cope with a trim bum in tight white jeans in lieu however!

Don't worry Alan summers coming ,short skirts will be back in..

jimmyb, is that your home help? Doesn't look like your pad needs much cleaning. Or is she just testing the furniture? :o)

Yes,, i originally advertised for a cleaner for 4 hours per week ,but now she does 40 with overtime.

I'm thinking of advertising for a secretary.....sigh !