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Mix-Ansicht- Interessanter Beitrag zur US-Wahl und WallStreet. - BossCube, 12.11.2000, 18:16
Interessanter Beitrag zur US-Wahl und WallStreet.
Kam neulich von Outstanding Investments:
At this writing, Friday, Nov. 10, the Bush campaign
continues to plead its case to the press, accusing the Gore
campaign of trying to hijack the election from the American
people. Even the Rev. Jesse Jackson has jumped into the
fray. This is a power play typical to a banana republic.
But it is being played out now, here in the richest, most
powerful country in the world - the country that everyone
else looks to for stability.
Forget the Iran crisis. Forget Desert Storm, the Yom
Kippur War, the Crash of '87 and everything since the Cuban
Missile Crisis. The political stalemate in Florida is the
largest threat to the stock market in almost 40 years.
Three days after the election, the world still does not
know who will lead the free world. Meanwhile, Democrats are
lining up to block a Bush victory even after a recount.
Talk of winning the popular vote is on the lips of every
Democrat, and legal challenges to the Florida vote are
certain to mount.
In fact, on Thursday it became official. Al Gore's
presidential campaign is requesting efforts be made to fix
what it calls voting irregularities in Florida. The focus
is on a ballot that Democrats say was misleading and led to
extra votes for Pat Buchanan rather than Gore (oh, yeah,
the dog ate my homework, too). If the Democrats question
the Palm Beach results, the Republicans will likely jump
into the fray for close examination of the states that Bush
lost by a thread.
Where will it stop? Who knows? Remember Clinton's
impeachment that droned on for months? And remember those
Americans that thought right or wrong Clinton should throw
in the towel for the good of the country? In this day and
age politicians want to win more than anything, so don't
look for any towel tossing.
That leaves America, the world's largest debtor and the
administrator of the world's reserve currency, in political
limbo. And one thing markets despise more than anything is
uncertainty.
At Thursday's close the Dow Jones Industrial Average was
down 73 points while the NASDAQ was down 31 points - not
large in themselves, but both building downward momentum
that began on Wednesday.
The political troubles couldn't come at a worse time for
the markets. Only weeks into rebuilding after the terrible
losses of October, it will take little to send them reeling
to new lows.
At the heart of this crisis is the future direction of
interest rates. Diminished confidence in the dollar can
easily translate into avoiding U.S. debt. Currently each
U.S. Treasury auction siphons $16 trillion in new funds. If
the political climate in America is open to question, new
buyers of Treasuries might be hard to find, and even, God
forbid, net selling of outstanding debt may arise.
According to the Debt Clock, public debt in the United
States stands at almost $5.7 trillion, or double where it
stood in 1990. The majority of this debt is short term.
That means it is constantly rolling over.
The ability to finance this debt means that rates must stay
reasonable. But that can only happen if there is
confidence in the American economy and the dollar. Strip
that confidence away and you play with fire.
Long-Term Troubles:
Even if we get a quick resolution, the outlook for politics
in Washington is abysmal. Look at the two choices. If
Bush wins, and I think he should, there will be screams of
conspiracy by the Left and lingering doubt that he failed
to win a plurality. If, however, Gore sneaks back in - I
don't know how he can, but I thought Clinton was going to
be impeached too - then the means and ways to which he got
into the Oval Office will be questioned.
Most importantly, America faces a terrible split in
government. Picturing the Democrats on the Hill working
with George W. seems like an impossibility. The same if
you flip the coin and talk about Gore leading the country.
Bottom Line:
If, and this is a huge if, markets were on solid footing
before this calamity, then I would not be so concerned for
our positions. That is not the case. The markets are low
on confidence and rife with technical weakness. This
crisis on top of a fledgling recovery for stocks may be
enough to torpedo the recovery and throw the markets into a
severe contraction.
I don't know this is going to happen. What I do know is
that it is prudent to prepare. I grew up on a farm on the
plains of Western Canada. You learn to have a nose for
approaching storms. When you see the sky and feel the air,
you know you have to take action. On the farm that meant
getting the animals to shelter, building up their feed and
loading up on supplies. Sometimes the storm didn't strike.
Other times it did, and when that happened you were damned
happy for the preparations you made.
Action To Take:
I'm not a Calamity Jane. I am, however, prudent. I see
very little upside in holding on right now, and plenty of
downside. As a result, I like the idea of taking some of
your portfolio and putting it into cash.
This is not a panic situation. I hate to sell on news.
But also, let's not get swallowed up later by the crowd.
Each of us is diverse. There is no exact answer, no magic
panacea. And after all, it is often harder to sell than it
is to buy. But we don't fret about the future. I am not
leaving you high and dry with this alert. In fact, I am
working on some defensive strategies that I will rush to
you next week in case my hunch is right. In the meantime,
I leave the specific disposition of moving into cash up to
you.
In the meantime, consider this: over the next six weeks, is
the upside for your positions stronger than the downside?
If the answer is no, then consider putting some cash into
the mattress.
I'm not talking about a wholesale liquidation. Instead,
I'm talking about a little prudence. We've been
successful with our picks, and now's the time to examine
your portfolio and take some profits off the table.
A prime example is EOG Resources (EOG: NYSE). We bought
EOG in November 1998 at $17.31. It hit a high of $43.88 in
October and closed yesterday at $39.69. This is an
excellent time to sell 50% of your shares and take the
profit. Winter may be milder than expected, and a
correction from this level wouldn't surprise me.
Or, what about Waste Management (WMI: NYSE)? Once again,
great time to take some profits. We bought in on that one
at $15.75, and WMI closed yesterday at $24.50. Nice
profit!
Take those profits and look into buying short-term CDs...
or T-bills are even better.
In two weeks we should know more than we do now, and
opportunities are certain to come along after the dust has
settled. Wouldn't it be great to buy your stocks back some
20%, 30% or even 40% below where they are now? You're damn
right it would!
Yours for Outstanding Investments,
John Myers
Gruß
Jan
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