Quick Comment on the Market

I still don't trust it, and we still have not seen the serious panic selling in either solar or agricultural stocks. When things are down 15% for an hour across the board for no good reason - that would be more of a "panic" bottom we can trust.

This market cannot even bounce back to S&P 1400; extremely poor behavior. The market has stunk but it has not been true fear like we saw in August at the worst of it. Makes me think we have more to come unfortunately. I hope to be wrong this time around.

I am going to be doing some trimming in some names across the portfolio here, to raise cash, nothing major in any 1 name, but I want to have cash at the ready to buy a panic dip low if we get one. In fact I am going to be trimming some of the things that have held up the best - Indian stocks for example seem as if they are in their own vacuum of bullishness. This type of "panic dip low" lasts for a few hours at most but when it happens, stocks drop massively and without any rhyme or reason (baby with bathwater). No guarantee that we get such a moment, but I want to have cash at the ready. The total inability to mount any move upward is quite striking to me....

I will note again, as I have been saying for the past week, Chinese stocks are holding up very well all things considering (see CNOOC (CEO)) which is a name I am very interested in adding to the fund)... in fact most emerging market stocks are. Interesting. One could argue they should fall too (next) OR one could argue assets are fleeing for "safe haven" of emerging markets. Not sure which line of thinking to be more worried about.

Right now the world's investors are drinking the kool aid that emerging markets are decoupled from the US/Western Europe slowdown. These are (or were) the same people telling us there is no slowdown coming in the US, or at most it will be "light", "shallow" and "a quarter or 2" at most. And that housing is 4.5% of GDP - nothing to worry about - exports will fix all that. They will be wrong about the emerging markets as well, but it could take time. Just like the US market held up since July 2007 when the writing was on the wall. It has taken 6 months for people to face reality in the US markets. It might take just as long for emerging markets to fall when people realize when 3/4 of the buying power in the world (W Europe, Japan, USA) is DOA that emerging markets won't escape unscathed. But for now, the belief is it doesn't matter and until it does matter, it won't. Funny I was typing those same words in October when the market was flying high in the US on Fed cuts... as I kept asking "why?". All in good time friends.