Minor victory for the bulls

8/20/08

As expected, bears are running out of steam today as bulls can call themselves a little victory. Volume is good. Despite continue bail out news for FNM & FRE ( which I think eventually the stock value will come to zero "0"), market could hold on. If...and really if US Government is going to bail out both GSEs, market sure would like Olympic 10meter diving motion....... Here there only 2 options that FRE & FNM can choose. First, issue more stocks to raise capitals that US government become the biggest shareholders. Or, US government going to fully take over both firms to become one of the government agency which means no more publicly traded companies...means stock value is going to zero in theory. Good luck to people who think FRE & FNM is cheap...CHEAP. CHEAP would get CHEAPER and it proves always right in BEAR market.
One more note I would like to point out here( I forget if I have ever mentioned here). There has 16 times 300+ points rally for DOW happened during bear market years 2000-2002. Also, since last year highs til today, there is 6 times 300+ points rally for DOW. However,folks, there is none 300+ points , no 300+ point rally occurred during the well known Bulls market from year 2002-2007. Do not believe or think the 300+ point rally will cure US economy mess. It is just another good short chance to whoever is BEARS..like me to make more $$$ out of your pocket. No long recommendation unless if that is the bear funds. Trade short term would be very fine. Good luck whoever still think financial is cheap to hold long term.