this stock is in traders hand, page-55

Sorry, but you sort of lost me with the "oversold" comment.

Oversold from when?

From where it was yesterday (but still debt stuffed)?

From where it was 6 months ago?

Or from where it was 12 months ago?

Not sure where in the chart it tells you that a company is rooted with debt and may well need another big capital raising but if the charts were worth a cracker, thats exactly what it should be telling you (but of course cannot).

The balance sheet is not stable and the bankers have a fair bit of leverage so playing the swings on your chart is akin to playing black and red on the roulette wheel while you fail to notice that the casino is burning down around you. Thus, playing black versus red is not at all a overlly risky proposal in itself unless the room you are standing in is in danger of caving in around you.

In other words, the balance sheet risk of GMG is sufficiently large to outweigh the benefits of trading this particular stock until the balance sheet risks have been reigned in just a smidge.

My idea of fun is not to have just loaded up on a stock because its chart screemed out buy only to have the management forced by the bankers to go out to the market an announce a $500M cap raising at a 20% discount to the market. All of a sudden your chart is looking a tad follish isn't it? Thats a very real risk here.

You can only keep telling your lenders to bugger off for so long. Sooner or later you need a debt rollover and the lenders tend to put a log of conditions down on your boradroom table. Raising equity is one of their favourites and of course they couldn't give a toss what price its done at.

One thing that is really starting to grate on the lenders nerves at the moment is that they are not seeing "ads for sale" in the press for their clients buildings. That is to say, the clients aren't walking the talk, they arn't trying all that hard to sell their trophy properties because they dont want to. They want to keep them and hope to ride the market out. Mr Banker's patience is running out fast and you will surely see many more properties come onto the market over the next few months as they get tough.

They tend to give you a choice. Sell the damn assets at market price or get out into the equity market and raise fresh capital. Sitting there sucking your thumb is not an option acceptable to your banking syndicate Mr Property Fund Manager.

I reckon the best trading strategy is to trade the LPT's which although debt ridden, have at least largely completed the rescheduling of their debt out to 2011 and longer. Thus, unless the market craters further, their lenders will largely be content to leave them alone.

If you have big slabs of debt falling due in 2009, your bankers will be having a fair bit to say about your equity level and the need to go and get some more or get real serious about dumping assets.