The scary thing is chuck that, from my calculations, there is expected to be close to 2 trillion dollars in Mortgage writedowns (500 billion commercial; 1.5 trillion residential) from U.U banks from 2011. This is a massive amount when considering that the real estate market at December 2009 was valued at 19 trillion. This should send a hail storm (large waves of volatility) through global markets over the next couple of years. Think about all the credit default swaps that are attached to these mortgages... Think about the secondary market for mortgaged backed securities... In my opinion are CDS over valued?? No where even close..
In my opinion, if you are investing look for oil stocks with good cashflow, management and great prospects becuase peak oil is on our horizen. Also I'm not too fixed on gold with the amount that india has been selling clearly it is inevitable that the gold bubble should pop - but when?
Bottom line is, I'm expecting the worst and I cant think of a sector other than oil thats worth getting into other than gold but its a lot more risky. Any ideas?
