To whom it may concern..., page-13

Hi Nickoo,

Good observation, and deserving of an answer.

Generally:

Previously I have argued (3/8) that:
"....we are dealing with a crisis of confidence, where quick fixes will not work, and where everyone is looking for a miracle, but react ferociously when such does not occur, or where the results are less than anticipated. This, in part, is why we get cases of such extreme volatility as they are now....Currently, the markets are imputing to everyone, the conduct of a few. Similarly, they are refusing to acknowledge any of the physical economy influences. This is bad. It is also wrong....The greater proportion of the US and Australian economies are made up of private individuals, and small to medium enterprises (most, unlisted). And yet, the markets ignore this to concentrate on the listed portion of the economy....In other words, the markets are looking for capitulation and will not rest until they get it. And then, they will whinge (like we all will) regarding the resulting "R" - recession and blame it one everyone else but themselves....Far from being a perfect beast, the markets (just as is human nature) are very imperfect. We should all remember this, going forward in our assessments of the future".

Also, see my more generalised posts on this of 20/7. The principles outlined there still apply.


On management issues:

I refer you to my post of 16/7, where I said:

"I am.. mightily p***ed with the extent to which....1)
accountants, with proper financial training and experience have consistently failed to properly budget for the future (ie: sales' forecasts, OPEX recovery rates, etc);...2) marketers, with proper on the line sales experience, have failed to properly understand the customers to whom they arsupposed to be selling to;...
3) management, with proper operational experience, who have failed to properly assess and detrmine the needs of their customer base (ie: and who keep selling concepts without proof, etc)....In particular, I am annoyed with the extent to which many people in business have failed to create the compelling event when it comes to selling something to a customer (ie: what is the compelling argument that will entice you to buy from me, etc?)".

See also my views on this @24/6, in reply to Bomber.


On the DOW:

Quite simply, I have got it wrong as to my trading range prediction notwithstanding my "get out of jail card" of "temporary sharp excursions above or below the various lines of support". That was back on 4/7.

On 25/7, I commented more generally:
"...you should also consider the arguments of Nickoo (calling the market down - right, so far), myself (not so right, so far), Greenrisian (calling the market down to 7500 for fundamental support levels), among others. That should provide you with a broad cross-section of views".

Where to for the Dow?

My predictions for this are probably not going to be considered acceptable, but here goes:
1)
more of the same - volatility up and down. Year end trading, anybody's guess. My view, however, is more likely up than below today's closing figure. By what margin? Could be by a factor of 10 -15%.


On the economy:

I have argued that the global economy is going through "apatchy and inconsistent economic recovery...Rather than a fully integrated global economy, running equally on all cylinders, the economy of the future will be as disruptive, and inconsistent as it has ever been in the past. Perhaps, more so. But equally so, the cycles will be more ordered than before (and hence less prone to sharp peaks, or extreme troughs)" (18/9).

I also still subscribe to that view, and to the view that the US is not headed to a double dip. Economic growth in the US during the 2nd half will approximate 3%, with Q4 perhaps slightly weaker than Q3 (both generally, and before the Ports dispute).

More specifically though, my mea culpa views of 24/6 (in reply to Bomber) still apply.


On Gold and FX:

My comments of 18/9 still stand, as follows:

"a rise above US$340 is doubtful in my opinion, and a retracement to $US285 is quite possibly still on the cards)".

"As for the FX rates, I am already on the record elsewhere as saying the following:
1)
AUD to trade in a 53 - 56 range between now and year end.
2)
AUD to dip to 53 by November; and
3)
AUD to top out at 56 by December, following an interest rate rise in the late November /early December RBA market committee meeting".


On Nickoo:

My post of 25/7 says it all - you called it. I didn't. Congratulations.

....
Now, I will return to my corporate activites.