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  • Association for Investor Awareness - Week of 11/20/2008

    In This Issue:

    Stocks Search For A Bottom
    High Energy Prices Will Return
    Commodities Will Also Rebound
    Infrastructure Spending Is Likely To Soar
    The Bottom Line This Week

    Stocks stumbled badly again last week as deteriorating economic news caused another round of investors to throw in the towel. By Friday afternoon, the Dow and the Nasdaq were down an additional 5.0% and 7.9%. The declines left the two indices down 35.9% and 42.8% for the year. Ouch!

    This week got off to an equally bad start. Although we had a 151 point gain on Tuesday, it was overshadowed by a 651 point slide on Monday and Wednesday.

  • Association of Investor Awareness - Week of 10/30/2008

    In This Issue:

    A Big Rebound May Be Close
    Like Kids In A Candy Store
    Super Stocking Stuffers
    These Trends Are Your Friends
    The Bottom Line This Week

    Another bear trap snapped shut last week when the 4.8% stock market gain from October 6 - 10 turned into a 5.4% loss for the Dow and an ugly 9.3% plunge for the Nasdaq.

    As has been the usual pattern during this stock market plunge, the drop was larger than the previous bounce. One of our group compared the market to a slot machine that gives just enough money back to make people want to keep playing.

    We saw another inducement to play on Tuesday of this week when the market surged nearly 890 points when it became known that the Fed would lower interest rates again. When the official announcement came on Wednesday, stocks eased back 74 points. It was a textbook example of the old Wall Street rule to "buy on the rumor, sell on the news."

  • Week of 08/28/2008

    In This Issue:

    Tensions Between The U.S. And Russia Are Serious
    Oil And Commodities React To The Threat
    Defense Stocks Look Even Better Than Last Week
    And So Does The Dollar
    Inflation vs Deflation Contest Heats Up
    But Inflation Should End Up With The Gold
    The Bottom Line This Week

    Last week the stock market revealed that it has more underlying strength than world events would seem to justify. If the market is once again acting as a leading indicator of the future, the outlook is brighter than is generally supposed.

    Despite the fact that a new cold war seems to be underway, the Dow was only off 0.3% last week. The Nasdaq declined 1.5%. The market dropped 242 points when it reopened on Monday, but it regained nearly half the loss on Tuesday and Wednesday.

    Our feeling is that investors want to be buyers and can only be held back by disturbing news. That's a big difference from a bear market mentality when bad news drives prices and good news is ignored.