InvestorMind

I was reading Robert Prechter's book called Conquer the Crash and here are some observation that I learned from Robert Prechter who popularized the Elliot Wave Theory. For example, did you know that during a recession or a depression, the top grossing movies are usually horror movies? There's also a lot more horror movies in times of depression, especially at the bottom. Possibly due to Hollywood mirroring the moods of the population. During the great depression of 1929 to late 1930s. The top grossing movie were Frankenstein (1931) and King Kong (1933). During the recession between 1970 to 1980. The top films were The Exorcist (1973), Jaws (1975), Jaws 2 (1978). The bottom of the market during that decade was Sept 23, 1974. When the market started recovering or when the population has had enough of the gloom and doom, the top movies were Saturday Night Fever (1977), Star Wars (1977), Grease (1978), Superman (1978) and Moonraker (1979). During the 1980s boom with Reaga

The Federal Reserve announced today that it is ending its $600B bond-buying program, popularly known as QE2, in June 2011. The Fed said that even though the bond-buying program is to end in June, it's going to continue a separate support program by investing $17 billion a month to buy Treasury debt by selling its portfolio of Mortgage-Backed Securities. As usual, these are all Fed double speak made to throw you off and not tell you exactly what's going on. What it means basically is that they are ending the bond buying program called QE2. They will continue buying bonds but it won't be called QE3. It's the same thing, but just called differently.

This is interesting. PIMCO basically said it has no confidence in the US bond market because of the huge deficit which could lead to high inflation and weaker dollar. He even shorted Treasuries in March. The high price of oil, gold and silver pretty much confirms that the US Dollar is losing a lot of it value.

This was on the Financial Post on Wednesday. According to the paper, there's two scenarios, one with limited impact and another could be devastating. So what can this mean to an investment portfolio? If we look at the worst case scenario. It talks of debt default which could hurt your bond holdings. Not only that, stocks would probably plummet as well. You can look at this as the sky is falling or an unprecedented opportunity to buy cheap assets again. U.S. companies are currently awash with cash. You can see how investors are buying up U.S. stocks now by just looking at the S&P500 chart. S&P 500 - 6 months ending April 7, 2011 Aside from a small dip in late March, probably due to the reaction in what happened to Japan. The S&P500 continues to go up. I has been going up since March 9, 2009. You've heard of bad news during this time like the double dip in the U.S. housing market and unemployment. But why does the market still go up? It's because w