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Mascoutah, Illinois | I will start by seperating my facts and my opinions.
Facts first:
1. The Japanese Stock Market fell below its 150 moving average. This is the first market to do so since the lows of early March. It is something to keep an eye on.
2. 26 out of the 30 largest banks in the United States need to raise capital to meet their 12.5% tier one level to satisfy the government. The four banks that currently have enough reserves are State Street, Northern Trust, Citigroup, and First Horizon. Keep an eye out for more secondaries which will be delutive to share holders.
Opinions:
1. Sell copper
2. Buy oil because I believe it is headed to the lower $80.00's
3. Beans have fourty to fourty five more cents of upside till they reach their high in the January contract. Will beans breakout above $11.00? I don't know.
4. I am still a firm believer in having all of your grain sold before year's end. Someone made a very valid point about 45,000 corn contracts needing to be bought between January 8-14 for indexing purposes. If we haven't had a collapse in world markets by that timeframe, my call in grains will be WRONG and the highs will be put in by mid January.
5. I am taking a trip down memory lane. In June of 2007, two funds from Bear Stearns blew up and everyone shrugged it off like it was no big deal. Three months later the crisis started and these funds were the wake up call few heeded. The parallel for me is the Dubai story is being shrugged off by many and everything is going to be okay. This is a warning sign of bigger things to come.
6. I believe AIG is going to ZERO unless the government steps in to prop them up one more time. The "put" activity was hot and heavy today with folks buying the $1.00 strike with the stock trading at $28.00. Does this sound familiar? (Bear Stearns, Lehman Brothers, etc.)
7. $4.00 corn and $10.00 beans for next fall are a wonderful opportunity so I would be taking full advantage of it in the next two or three weeks. If you cannot turn a profit at these prices in 2010, something is very wrong with your operation.
KEEP YOURSELF LIQUID AND HAVE PLENTY OF CASH ON HAND. THE PATIENT ONES WILL MAKE A FORTUNE WHEN THE SECOND CRISIS HITS.
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Keeping my eyes pealed
