What is going on in the financial world?
March 26th, 2007 by helpfulfactsEverything I’ve been reading is very suggestive of another big drop coming soon to the financial markets. It all started when Shanghai Index drop ~10% in one day and caused a skid on the stock markets around the world. Nearly 2 months later, they have recovered and hit record highs.
However, the story doesn’t end there. Shanghai is keenly interested in the sub prime mortgage market in the United States. Any signs that defaults and foreclosures will lead into a recession will cause a ripple effect throughout the world.
The state of the sub-prime market is pretty negative at the moment. It may be just gaining steam and can get a whole lot worse.
I would suggest watching the market carefully and determining the impact on your local economy. It’s obvious the real estate market is feeling the pain, but when it causes sales to slump in consumer goods watch out. Home Depot and Lowes have been feeling the pinch.
Recommendation: take some short positions and hedge your bets.
Posted in Real Estate Investing |