Thursday, September 2, 2010

Straight talk, kopitiam talk, talk talk???

Let me be straight, ah -- it's a dangerous opening line actually. You know that I am going to talk about something is not so straight forward.

It's mind boggling now because we are at a very uncertain cross road -- the bull and bear are arguing ferociously. Let's start with the bear first.

The bear said that we are going to get into double dip recession.

The bear also said that this market is dominated by technical traders. One of the very bad technical pictures that has formed recently was Hinderburg Omen. All market crashes displayed Hinderburg Omen's characterictis but NOT all Hinderburg Omen's warnings necessary will lead to market crashes(hello are you talk talk??)

It's pretty much useless to me but if you are interested in the detail go here:

You may also want to see its reliability in this chart. If you are sharp, you can really see it, can you see it?

Never mind, let's move on. Our selective perception is the secret of human surviving instinct. If you are bearish, you will see a Shoulder-Head-Shoulder pattern, then will start to fit all kind of data into your head, once your see DOW 9899 you call for DOW 5000 again! Amazing huh?

Let's rotate our seat, what say you Mr. Bull?

They will say double dip is a very rare thing, it's only happen in 1930s and early 1980s. One was very close to the Great Depression(which I think we are very far from it), then the other one was in the early 1980s when Volker tightened the interest rate screw so tight all the way to 13.5% -- trust me nobody can breathe. Those people in their late 50 or early 60 years will remember they have to refinance their loan 7 - 8 times/year(Psst --- I am not that old). So you tell me how not to have double dip recession?

Today environment is so different because it is supported by whole bunch of stimulus packages and almost zero interest rate. So how to have double dip?

Back to selective perception again, the more optimistic will look at it we are in a trading range ( stuck between 10,000 - 10,700), we got to see whether it's break down or break out to resolve this deadlock. Or else like that-lah, all blogs will go into comma-TOAST.

This kopitiam talk enough or not? Very sorry if I have committed a lot of grammar mistakes or china man English in this entry because I am really rushing.

See you all in the weekend. What a stingy bugger I am, only 2 entries this week!

One last tipsy --- the moral of the story from Uncle Turtle is understand CAUSE and EFFECT, understand or not?

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