Drop Shot

I apologize to my readers for the lack of updates over the last two and a half months. Truthfully, there are just no deals in the market. The stock market has continued to drop since my last update and is almost half of what it used to be in October 2007.

 

One of my readers asked, “What does it take in order for the financial markets to turnaround?” The solution is actually quite similar to retrieving a drop shot in tennis. We must counter with speed, precision, and placement. Unfortunately, we have yet to learn how to do all three correctly (unless you are Roger Federer or Rafael Nadal of course). Do you think we can finally grow out of being Andy Roddick? I guess only time will tell.

Forehand

In emails to Deals In The Market With Jack Li, I am often asked "Who is Jack Li and what's he really made of?". 

Apparently very few of those correspondents went to Harvard, or they would know that the answers are (1) me and (2) largely water and organic chemicals, with some small mineral content.

Anyway, this week's Deals In The Market With Jack Li commentary answers your queries about when will the stock market bottom.  I have looked at 50 year histories of the Dow, especially during periods where economic downturns have been combined with some sort of financial crisis.  While patterns are diffcult to discern, and during this period in the market volatility is at an all time high, I feel reasonably confident that the market will bottom out after stock prices stop falling and begin rising again for a sustained period. I'm not (for now) recommending you trade on this insight, as not all of the correlations in my analysis were strong. 

I'm Jack Li, and I thank you for your loyal readership of Deals In The Market With Jack Li.

Keeping It Real

I realize I have been remiss in updating the past week or two.  To summarize, there are no deals in the market.

Progress On The Bailout

As many readers will be aware, legislative approval of the proposed government bailout of financial institutions is proceeding slowly.  My view is that Mr Bernanke and Mr Paulson have plenty of power, but could use more spin.  You can't win without power AND spin.

 

Observations From The Markets

A number of stocks have gone up and down a lot in price recently.  It's quite confusing.

 

Questions and Answers With Jack Li

Here at Deals In The Market With Jack Li, each week I receive literally one or more fascinating questions in my mail from my devoted readers.  Each week I take a selection of those one or more questions and provide incisive, personalized answers to the issues that are on my reader's mind.

 

Dear Jack Li, As an informed market insider and given all of the deals you must see as publisher of Deals In The Market With Jack Li, how do you think the market turmoil we have seen recently is going to play out?  I am very concerned about my portfolio.

 

Worried Investor, Tasmania

 

Jack Li Answers:  That's a hard question.  So let me pose one back.  Did you see how Nadal nailed Roddick?  Don't YOU think he could do with more power and more spin?

 

 

Well, that's all the reader questions we've got time for this week at Deals In The Market With Jack Li.  I hope you'll check out next week's Questions and Answers With Jack Li for more.

 

Davis Cup Analysis

The reason that Roddick lost to Nadal on Sunday is not enough power.  And spin.  More power alone won't be enough to beat Nadal. More spin alone won't be enough to beat Nadal. What he needs is more power AND spin.