1:16 pm - Market Outlook by Bill Wermine

Dear Traders,

Below is my outlook for the stock market in 2009. It will be published in Malaysian Business in their end Jan edition:

By the way, we plan a Traders Club meeting on Sat 7 Feb at 10 AM at CIMB auditorium and plan to have the head of Technical analysis of CIMB (to be confirmed) who will give his 2009 stock market outlook.

Please let me know if you wish to attend Attached is the latest valuation of Man Essential, the recent launch. (30 Nov 2008 valuation)

How to Minimize your Costs and Risks while riding the 2009 stock market Bull

Below is a prophetic chart from Deutsche Bank research. It shows that stock markets bottom out a little more than half-way through recessions.

Based on this chart, I expect that 2009 will likely be a much better year for the markets than the year we have just endured. From this chart it appears that we are more than half way through the recession and probability is high that we will soon have a market recovery.

The Fuel to drive the Bull

We are on the verge of the Obama administration “stimulating” the US economy through public works and infrastructure projects, likely to the tune of nearly $1 trillion.
Obama’s program is likely to stimulate the economy and invigorate world markets in the near term.
The Federal Reserve has also signaled that it will do everything within its power to stimulate the economy. In the eyes of central planners, desperate times call for desperate measures. And the Fed is clearly desperate.
With their latest policy statement, issued on 22 December 2008, it is clear that the monetary helicopters have arrived. Not only have short term interest rates been cut to nearly zero, the Fed has also stated that it will resort to “alternative” means to juice the economy.
Have a prosporous New Year,
Bill