free e-letter

Fleet Street Daily: insightful, humorous and contrarian investment advice - get it FREE each day here…

FLEET STREET LETTER

Fleet street letter

Contrarian, cutting-edge analysis for sensible, long-term investments that secure you high growth and healthy dividends.

Find out more about Fleet Street Letter »

ZURICH CLUB

The Zurich Club

The Zurich Club gives you access to a seasoned panel of expert’s, whose tips and advice are intended to deliver top notch gains.

Find out more about Zurich Club »
FTSE 100

How You Should (and shouldn’t) Prepare for a FTSE Nosedive

Date 29/08/2008
Fleet Street Daily | By Ben Traynor
Today we’re tackling perhaps the most fundamental question in investment. What’s going to happen next?

I could embark on a truistic homily about how it’s not given to man to know his fate... how we must play the hand we’re dealt... or something along those lines.

But you already know all that. So... what do we think will happen next?

I cornered Theo Casey, The Fleet Street Letter’s investment director, and asked him a monster question.

What will be the next big move for the stock market?

Sign up today for our FREE daily newsletter
Enter your email and you will get our FREE newsletter directly to your inbox
Logo1McAfee Secure sites help keep you safe from identity theft, credit card fraud, spyware, spam, viruses and online scamsPrivacy Policy

"Well," he answered, in his typically cautious, investorish manner. "I wouldn’t want to pin my eyeballs to this... but a fall below 5,000 is a real possibility."

The FTSE 100 is, at the time of writing, at 5,628. A fall below 5,000 would be calamitous.

"Of course," adds Theo, "I do hope I’m wrong. But I’m preparing in case I’m right."

Theo’s not alone in this view. Several prominent analysts have expressed similar concerns. It raises the obvious question - is there anything we can do about this?

Well, there is one obvious answer - one that tends to get forgotten. You can simply hold cash. I’ve already told readers of The Fleet Street Letter that there is nothing wrong, at times like this, in holding more cash than you’re used to.

That may not be terribly exciting advice. But, to me, it makes sense.

"But you don’t have to completely cash out," adds Theo. "There is a way you can prepare. However, I fear many investors will do the one thing they shouldn’t, mistakenly believing it’s the best way to minimise risk."

Read on to discover what investors should - and shouldn’t - do to prepare their portfolios

Why Garry White believes Iran will be bombed at Christmas

"It may be the Israelis that do the actual bombing," writes Garry White, "but the Americans, British and French will be major players. They’ve just finished practising their plan."

Garry reckons Iran will be bombed at Christmas. And when it is, the oil price will soar.

Sign up today for our FREE daily newsletter
Enter your email and you will get our FREE newsletter directly to your inbox
Logo2McAfee Secure sites help keep you safe from identity theft, credit card fraud, spyware, spam, viruses and online scamsPrivacy Policy

"Why Christmas, Garry?" I asked him.

"Well," he said, "it won’t happen during the election campaign. If Republican President Bush orders it, that would risk harming McCain’s chances."

It’s also unlikely that a new President would want his very first act to be an act of war.

"However," says Garry, "there is a one month interregnum that comes after the election but before the new Commander in Chief is inaugurated. It’s the perfect opportunity for someone to lob a bomb with minimum political fallout."

Garry reckons the US and its allies have a lot to gain by bombing Iran... more than you may think.

And, he says, they’ve already begun preparing.

Find out why our man reckons oil investors need to prepare now for a military strike

Until tomorrow,

Ben Traynor
Editor


The Daily Reckoning - Badness in economic terms means either inflation or deflation - or both What are we reckoning with today?

"Market buoyed by strong GDP report," says a headline.

Yesterday, the Dow managed a strong rise - up 212 points. Oil fell back to $115. Even with a hurricane whipping up the waters of the Gulf of Mexico investors figured oil was a sell.

The dollar rose to $1.46 per euro. And gold rose too - plus $4.80, to $838.

Gold seems to have bottomed out at $784. That might have been the best buying opportunity we will have for many years. Time will tell.

We’re not bothering to guess. To us, gold is a good thing to have when things go bad. And after such a long period when so many things went so well, we suspect it’s time for them to go bad - and in a big way.

Badness in economic terms means either inflation or deflation - or both. And both is what we’re seeing.

You can read the Daily Reckoning in full here

Sign up today for our FREE daily newsletter
Enter your email and you will get our FREE newsletter directly to your inbox
Logo3McAfee Secure sites help keep you safe from identity theft, credit card fraud, spyware, spam, viruses and online scamsPrivacy Policy
P.S. If you enjoyed this article then we encourage you to sign up for the free Fleet Street Daily eletter. Learn what you can expect from today's markets -- and how to prosper in the face of uncertainty. You won't find more thought provoking writing anywhere on the Internet.
fleetstreetinvest

Your capital is at risk when you invest in shares – you can lose you some or all of your money, so never risk more than you can afford to lose. Figures may refer to the past or be forecasts. Past performance and forecasts are not reliable indicators of future results. The FSA does not regulate certain activities, including the buying and selling of commodities such as gold. If in doubt about the suitability or taxation implications of any investment, seek independent financial advice.