market view

As far as geographical exposure goes, we continue to recommend over-weight positions in the developed world (Europe, Japan and the US).  Since April 2011, the developed world has outperformed the emerging nations by a wide margin and we expect this trend to continue for the foreseeable future. However, over the past few weeks, a number of emerging markets ETFs have broken out of multi-month trading ranges, so we now recommend modest exposure this area.

In terms of specifics, we continue to see incredible momentum in India’s stock market!  You will recall that we first recommended exposure to this market several months ago and despite the recent run up, we see plenty of potential.

Elsewhere in Asia, Hong Kong has recently broken out of a lengthy consolidation phase and even Taiwan’s stock market is gaining momentum.  So, our readers can consider looking for opportunities in these stock markets.

Over in South America, Brazil’s stock market is showing signs of strength and the uptrend could continue for several months.

In summary, the monetary backdrop remains favourable towards stocks, America’s housing market is rebounding and a variety of technical indicators are showing strength.  Therefore, we continue to believe that the ongoing primary uptrend will continue for several months, so our readers should stay fully invested in common stocks.

Although this bull market is mature and we will get some volatility heading into spring, the path of least resistance remains up and investors should stay positioned for the northbound journey.

- Puru Saxena

crash ahead

"This stock bubble is getting very steep and the possibility of an avalanche is growing. For those investors with passive 401(k)s, IRAs or retirement brokerage accounts, look into selling stocks on every rally in the weeks and months ahead. It’s better to be a bit early rather than a bit late in getting out."
"There are a few of us who remain entrenched in our bearish camp… There’s Robert Prechter, Robert Shiller, and George Soros, to name just three. Soros just made a $2.2 trillion short bet on U.S. stocks and he is rarely wrong. I’d suggest you listen to these guys, as well as us."
-Harry Dent

Debunkery - Ken Fisher

I read this book recently. To sum it up all this is what he recommends:

invest in stocks all the time even when you are retired
in the long term it performs better than any other assets
the market will always bounce back even after a bear



so just get into stocks when you can
forget about dollar averaging
diversify diversify diversify
growth, value, small caps, US, foreign, various sectors
just buy them and hold
don't trade or time the market
it is too complex for any single indicator to be reliable
that includes pe ratio, interest rates, comsumer confidence and whatnot
or events like sars, terrorism, unemployment
only exception is the presidential cycle
and all these are proven by historical facts
cash flow management is the key
diversity smoothens out the volatility

Well, that's the long term strategy
but who can wait for long term
we all want to become rich now ! right?