More Proof of Green Shoots

While besides the fact that unemployment is increasing…besides the fact foreclosures are increasing and now spreading to some of the so called safer mortgages… besides the fact the insiders of stock have been selling widely ( For every share purchased…insiders have sold 18 shares) while short term traders are trading micro seconds…

Another proof of Green shoots was reported today by Bloomberg that the four biggest U.S. banks by assets may have to take writedowns on $55 billion of mortgage- collection contracts after marking them up by $11 billion in the second quarter. Let me make sure I understand the accounting… they have approx $55 billion in losses and these banks reversed that and stated they have a $11 billion dollar profit. That is some great accounting feat!

What also came out in the article was the fear that the analysts have for the upcoming future.

Click here to read the Bloomberg Article

Truthfully one had to be naive to think that the US Banking system is healthy. Reports like this might just be the tip of the ice berg.
The big question should be…How do I protect my net worth? Stocks are over bought…Banks do not seem safe. What is one to do?
The story that I believe is Commodities. If there is truly a recovery… it would seem very obvious there will be inflation. Through out time whenever a country prints money there is inflation. Through out time when ever there are strong debts in a country, inflation picks up. All one has to do is read the tea leaves. The US consumer is in debt up to their eyeballs… US banks are virtually bankrupt. These are not my words but George Soros.

Even if there is no inflation, do remember China. They have a growing demand as well as so do many of the emerging markets. Put into context the droughts that are occurring all over the world potentially demand can not keep up with supply. When there is more demand and less supply prices go up…

So what can you do… Consider owning real assets that are liquid. The only suggestion for that is commodities. Jim Rogers has been speaking about this for years. Jim Rogers warned about the housing crisis. You have a choice… We are in an economic survival mode.

If you have commodity related questions please, feel free to contact me. I will be happy to answer your questions to the best of our ability.

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Andrew Abraham
A.Abraham@AngusJackson.com
www.AJpartnersinc.com

Futures trading involves risk. People can and do lose

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