MARKET COMMENT
September 24, 2008, Courtesy of Dave Fry, at ETF Digest.
The FBI is investigating FRE, FNM and AIG. It wouldn’t take a genius to figure out that they’re looking for–fraud and massive cover-ups. While the scope of all this is unknown I feel like I’m back in 2003 waiting for executives at Enron, WorldCom and Tyco, to name a few, get carted off to the hoosegow. Greed has a short memory. 
The inbox is full of mail from yesterday’s posting and basically everyone is of the same mind–this proposed bailout deal has a lack of disclosure.
The president speaks tonight and perhaps he’ll clue us all in.
The big news initially today was another slick Warren Buffett deal whereby he gets a stake in Goldman Sachs and a 10% preferred dividend with warrants attached to convert to equity. Is this a good thing? It is for him period. Can you get such a deal?
Today the SEC added another dozen companies to the short-sale ban list including IBM. Here’s a list of them. Why add IBM? What’s the rationale if any? It’s become too random to understand and the folks at the SEC are out of control.
Speaking of shorting issues I’ll be doing a webcast with ProShares Thursday at 4:15 PM EDT. This webcast is restricted to Financial Advisors and Registered Investment Advisors. To listen in follow the links below:
Click on “Event Center”
Select “Creating an ETF Hedge Fund”
Speaking of ProShares some of their ETFs recorded dividend distributions today. This affected prices as those issues receiving dividends prices were reduced. I got plenty of email about that today as well. To see the list follow the link below:
http://www.proshares.com/funds/distributions
Markets today moved around in trading ranges today as investors remain frozen like deer in the headlights. Volume was light but breadth remains highly negative. As the latter continues to build so too do oversold conditions.
For those interested in alternative ETF assets from commodities to currencies our September 18th podcast interview with Kevin Rich, CEO Global Currencies & Commodities Deutsche Bank is available free and without registration HERE.
There will be no posting tomorrow given the webcast with ProShares being done for financial professionals at about the time I normally start writing. So, unless everything falls apart or zooms higher spectacularly I’ll be having a beer and relaxing at post time. 
Investors are frozen not knowing whether to buy, sell or cry. Rather than generating confidence and trust the government is creating confusion and concern. These silly short-bans are becoming amateurish and not making sense.
Many bulls “hope” that some rescue package deal will be reached and approved. They believe we’ll have a big rally as a result. But it may be just another of those knee-jerk rallies that last one or two days only to fail once again. Nevertheless, the more oversold we become, and we’re getting there, the sharper the countertrend rally.
The financial crisis needs more disclosure and light shined on it. Until then we don’t know what we’re up against.
Thanks to everyone for their emails and comments.
Have a pleasant evening.
Disclaimer: Among other issues the ETF Digest maintains long or short positions in: SDS, QID, SMN, SIJ, SDP, IEF, GLD, DGP, EFA, EFU, EEM, EEV and FXI.
