More doomsday scenario...

My broker just sent me a doomsday scenario for the rest of the month which she ripped off from dowjones.com:

"Weak U.S. stock futures suggest Singapore shares unlikely to turn around for rest of session. Whether prices fall further may hinge on how European markets open later. STI off 1.5% at 2813.41, with immediate support at 2800, followed by current month low of 2775. Outlook may not improve any time soon, says SIAS Research head Roger Tan; "with the World Cup coming in June 2010, we believe that we will continue to see a lackluster and directionless equity market for the rest of May 2010."

Wanna bet?

Didn't I say, in the post be4 this, that what goes up will come down? It's done so with a thud as of last Friday (May 14).

Now this despite the US1 trillion bucks to be injected into the Old World's various teethering economies so that the stitched together euro won't crumble like a piece of chalk from the cliffs of Dover.

The new, for which read, the overbought scenario this week is that worries abound about the effectiveness of the USD1 trillion bail out. Will it take too long to cobble together let alone disburse before the patient evaporates right be4 everyone's eyes, very much like an ice-carving apres a function.

Other worries is that to pay back the bail-out, European governments would have to go into austerity overdrive, cut spending and raise interest rates. Or if this doesn't pan out, there will be hyperinflation, further euro devaluation, possibly changes of governments, riots in the streets etc to help debt laden nations get out of repaying their debts at their true value...

Whatever the scenario, my prediction is, if the falls are swift and large, there will be a rebound. Hey oil is at its lowest levels for several weeks. Now, isn't that a reason for share prices to resume climbing, albeit up a rather slippery pole! :-D

Sell in May and go away?

Not on your Nelly...

Such adages were good for days when stock markets weren't global and no one can access the market once it's officially closed for the day or the week end.

Not any more when you can buy options, futures and every sort of derivatives you can think of on the market or around the market. Also, not any more when you don't need to talk to your stockbroker whether you want to buy or sell. Like Nike, you just do it via the Internet or intranet.

So, Singapore fell for five straight days last week, as did some of the major (read, influential) markets, it doesn't really need a USD1 trillion package from the Old World of Europe to ring fence the euro and Greece for share prices to pick up.

It and other markets that had been crumbling will rise because what falls must rise, and what has risen must fall. This is the law of people using spare cash earning almost zero interest rates to churn their portfolios.

So next time, when the markets are falling, no need to wait for experts or analysts to tell you the markets will rise beause of this or that. Ditto when the markets are galloping, no need to listen to those who warn of bubbles or unsustainability.

Such forecasts are simply no-brainers!