looking bearish, page-24

Hi Volt

You might be right and with out doubt certain types of stocks will take a complete caning. The key as I see it is the huge problems between the USD and the major exporters to the USA with their fixed USD exchange rates.

At some stage the Chinese have to allow a big re-valuation against the USD which will result in an enormous losses in value of there current USD holdings, will this occur along with the predictable decline in the mainland and bonkers Honkers market, maybe.

As I said before I think the catalysts will be oil related, either S.America, Iran or Nigera will have a massive production curtailment. Looking for oil to be north of USD 120 per barrel before end June 2008, what that will do even for the amazing Australian consumer will have to be bad, inflaction above 10%. In actual fact already there, took the kids to see Golden Compass yesterday (not to bad a film), re-join the kids club, last year kids club ticket price five bucks this year seven buck, which is 40% increase!!!

So my feeling is that certain sectors will do well, hence long massive in a private oil company, long quotes oil and gas stocks (plus small producing gold) and avoiding any thing highly geared and not cash up.

Should be an interesting year.

cheers

PC43