Vaule Based Reality Bites - 6 / 23 / 2009

Yes, I have been silent for a period of time. I have done a bunch of thinking over the last few days. Here are my conclusions.

1) As an investor in equities, you are taking great risk in these markets.

2) There may not be any actual support levels in the markets, and there may never be again by traditional, technical standards.

3) On the other hand, there will be value and fundamental based support levels for discrete issues.

4) Investors can not ever be long term holders of single funds or stocks again.

5) Cost averaging works only with stop loss positions on each entry point. Averaging down means you have made a mistake and now are compounding that mistake.

6) Experts making daily or weekly market direction calls are not only fooling themselves, but they are also fooling investors.

7) The economy has not turned around, nor has it bottomed.

8) The dollar has begun, likely 2 years ago, its inevitable slide to 70% of its 2005 - 2006 values. World currencies are performing similarly.

9) Cash Flow remains and will always be King.

10) Gold is not an investment, it is a hedge.

11) Oil is a manipulated commodity, by governments, by traders, by producers. And because of this, the dollar is a manipulated currency as well.

12) It is not possible to be a long term investor in any traditional asset - real estate, commodities, currencies, equities, or bonds - given the lack of investment and financial experience at the US government Treasury, Fed, Executive, or Congressional levels. Without an expert and consistent theme from the US government, there will be no stability.

Watch your step very carefully.

Build Value Every Day,

Bradford van Siclen