FBR could make you rich, or not!, page-18

Not exactly Ash it’s the same whip saw action on the Dow but the drivers are very different

2008 was all about leverage subprime collateral securities

Disgraceful lending practices poor regulation greed on a scale never seem before

Our whole financial system collapsed.globally people in the US lost whole super funds houses jobs

We are not now anywhere near danger of that

A GFC type fall 6300 to 3200 is unlikely to happen again unless something goes horribly wrong

There are circuit breakers now limit down etc and much more regulation by the SEC

This will not end like the GFC at all but it could be the start of a deeper correction

In volatile markets, the hedge funds run the show look at today's action halving the day's losses almost

There is no real selling with conviction which was the case mid-2008

A lot of this is the ten-year bond yield curve spiking

A lot of traders in the US watch the Vix which spiked hard this week often a sell signal

Big difference between a crash and a prolonged correction which can last months with rallies in between -commonly known as suckers rallies

If you're going to sell stock you sell into the, mnot into weakness

How all this affects FBR is unknown as news flows can spike a share higher even in bad markets

I held JBH thru the GFC which I've owned since 2007 it walked straight thru the GFC

Stocks like BHP RIO are still neatly half what they were in 2008 some stocks take years to recover

Key is cash you need a good proportion of your money in cash thru corrections to take advantage of overreactions and opportunity to buy good stock lower

No use been fully invested right now as that gives you no firepower to short or hedge with gold etc

Interesting spike in gold stocks today always a sign stormy times ahead

I hold NST EVN for that very reason always pay to hedge

We simply had it too good too long last year this year needs more caution

Not saying its doom.n gloom.just be vigilant and the biggest mistake people make in corrections is doing nothing

Either augment cash for opportunities or hedge over your portfolio

Sit like a rabbit in the headlights you will soon be road kill

Puck your marks pick them.well don't be afraid to buy something 10-25 per cent cheaper you were going to . Month ago

Drip feed the correction in my view