The FBI is investigating FRE, FNM and AIG. It wouldn’t take a genius to figure
out that they’re looking for--fraud and massive cover-ups. While the scope of
all this is unknown I feel like I’m back in 2003 waiting for executives at
Enron, WorldCom and Tyco, to name a few, get carted off to the hoosegow. Greed
has a short memory.
The inbox is full of mail from yesterday’s posting
and basically everyone is of the same mind--this proposed bailout deal has a
lack of disclosure.
The president speaks tonight and perhaps he’ll clue
us all in.
The big news initially today was another slick Warren Buffett
deal whereby he gets a stake in Goldman Sachs and a 10% preferred dividend with
warrants attached to convert to equity. Is this a good thing? It is for him
period. Can you get such a deal?
Today the SEC added another dozen
companies to the short-sale ban list including IBM.
Here’s
a list of them. Why add IBM? What’s the rationale if any? It’s become too
random to understand and the folks at the SEC are out of control.
Speaking of shorting issues I’ll be doing a webcast with ProShares
Thursday at 4:15 PM EDT. This webcast is restricted to Financial Advisors and
Registered Investment Advisors. To listen in follow the links below:
https://profunds.webex.com
Click
on “Event Center”
Select “Creating an ETF Hedge Fund”
Speaking of
ProShares some of their ETFs recorded dividend distributions today. This
affected prices as those issues receiving dividends prices were reduced. I got
plenty of email about that today as well. To see the list follow the link below:
http://www.proshares.com/funds/distributions
Markets today moved around in trading ranges today as investors remain
frozen like deer in the headlights. Volume was light but breadth remains highly
negative. As the latter continues to build so too do oversold conditions.
For those interested in alternative ETF assets
from commodities to currencies our September 18th podcast interview with Kevin
Rich, CEO Global Currencies & Commodities Deutsche Bank is available free
and without registration
HERE.
There will be no posting tomorrow given the
webcast with ProShares being done for financial professionals at about the time
I normally start writing. So, unless everything falls apart or zooms higher
spectacularly I’ll be having a beer and relaxing at post time.
Investors
are frozen not knowing whether to buy, sell or cry. Rather than generating
confidence and trust the government is creating confusion and concern. These
silly short-bans are becoming amateurish and not making sense.
Many
bulls “hope” that some rescue package deal will be reached and approved. They
believe we’ll have a big rally as a result. But it may be just another of those
knee-jerk rallies that last one or two days only to fail once again.
Nevertheless, the more oversold we become, and we’re getting there, the sharper
the countertrend rally.
The financial crisis needs more disclosure and
light shined on it. Until then we don’t know what we’re up against.
Thanks to everyone for their emails and comments.
Have a
pleasant evening.
Disclaimer: Among other issues the ETF Digest
maintains long or short positions in: SDS, QID, SMN, SIJ, SDP,
IEF,
GLD,
DGP,
EFA, EFU,
EEM, EEV and
FXI.
