Mid Week Pit Stop #21

1 Year ago...

I remember it was April, when the markets kept making new highs every week. I was like looking at everything and telling my frens that the markets are going crazy and it shouldn't be like this. China was like up 170% for a year or so, STI was up 25% in a year. There is only one thought in my mind at that point of time - STOCK MARKET WILL CRASH...


Well, when subprime comes in july, I begin to study the impact of housing on the US economy. Also, this is also about the time when my investment begins to form. Mr. X, the mail man (missing in cornell), one more guy (haven't thought of a nickname for him) came together with the same mentality - stock market will crash.

We understand the housing implication; the intangible side of credit, something that cannot be built overnight since its a matter of trust. The markets pick up real fast after Aug, and we decide to short the market heavily when STI was around 3600. The rest is history.

My point of telling this story is that sometimes, its quite fruitful to do things in a group especially when you are doing it with a bunch of people who think the same way as you. Of course, we met lots of trouble - getting caught in a crazy last burst of fire from the bulls, getting killed by time decay on our warrants, lots of emotional ride here and there. But it was a good learning experience. We understand what's going on, just that we don't know how to make full use of it.

Coming to present, we met again on monday night and were looking at the Dow closing at 500 points down (yes, we were still watching cnbc at 4am). Even though, we were late for a year and didn't have a position in the market as team (I have on my own of course), we knew that we came together as a team for a good reason and the initiative was very right in the first place.

So I urge you to learn from your friends, maybe you can form a team as well to assist in your learning. We can form a new team as well if you wish to learn together with me. I don't mind. The whole purpose of this blog is to educate people and provide a new learning platform anyway.

Looking at the market now...

Again, yesterday night was not panic selling as well. There is more to come. But be prepared, the bottom is coming soon. Well, I don't know how low HSI will go but I'm pretty happy to sit on my put warrants anyway.

I have lowered my target for China to about 1700. I can't really picture anything for HSI and STI. Dow target still stands at 9750. Remember, we want to pull out only we see panic selling.


Gold is doing good as well. Buy some gold for long term purposes.



The stock market continues, and investors continue, to want to believe that what they’ve seen in the past over the last 20 years is what they’re going to see in the future. They refuse to face the truth.

Anonymous