do nothing, page-2

There won't be any bounceback. Comeback yes but not a bounce .... this time it's serious.

US confidence is the problem with latest figures showing it is slipping down a greasy pole. Houses prices are now slding faster than ever, and that affects the way people feel about their wealth. If you feel you are getting richer you spend, if you feel you are getting poorer you hold back. US consumers make up 70% of US economic activity and a lot of that money is spent on imports from Asia, our biggest customer. A lot of the spending was done on credit and now easy credit is a thing of the past thanks to the sub-prime mess. The personal savings rate in the US has gone negative - not seen since the depression.

Add to that higher oil prices and companies like Wal-Mart cutting their profit forcasts and you have enough ingredients to indicate that a slow down is on.

Of course it would be nice to put on the rose coloured glasses and think it's not happening but the reality is, it is.

Will the US slide into recession - 0.5% interest rate cut a month ago suggests the Fed is concerned it just might.

And oh yes, people may say that China is building like crazy and it will save us but will China continue to build factories when existing shelves are still stacked up. And could China have it's own "sub-prime" fiasco as there is evidence of excess, unsold housing in some areas.

For Monday the best strategy may be to sell out early and buy back in, in days or weeks to come.

My prediction - ASX down 3%+ on Monday.