Richard Hoey, chief economist of Bank of New York - Mellon was on Bloomberg TV open exchange just now. He mentioned that the dollar is rising because hedge funds had been bearish on the dollar, and now have to unwind those leveraged trades to get more cash. The commentator mentioned that they just had Dr. Doom on (see below), who said that the only safe place to be right now is cash, and he also sees the dollar going up as he doesn't see how it could fall any further. Hoey also said that the dollar is the fulcrum [my word] of the global economy. In other words, it still acts as the central currency for trade, no matter how high or low it goes. The commentator also mentioned the unwinding of the Yen carry trade as an example of hedge fund liquidation. Time to look into ETFs that track the dollar.

Forbes article "ETFs Tumble On Investor Worries" recommends bying XLF, a financial sector index ETF that includes C, JPM, GS, MER. Trading at 10.7 times earnings. Maybe the bottom has been reached.

More stock investment/trading ideas as quotes from some news stories.
Jun. 13

Finally, for the more aggressive among you, consider inverse bond funds like
Rydex Inverse Government Long Bond Fund
(RYJUX : 19.65, -0.16, -0.8% ) or
ProFunds Rising Rates Opportunity ProFund
(RRPIX : 20.26, -0.17, - 0.8% ).
These funds trade inversely to bond prices -- meaning they RISE in value when bond prices FALL. You can also target vulnerable sectors of the market. For instance, you could sell short the
SPDR S&P Homebuilders ETF
(XHB : 25.50, -1.53, -5.7% ).
Or, you could buy the
UltraShort Real Estate ProShares
(SRS : 112.00, +6.82, +6.5%).
The leveraged ETF is designed to rise 2% for every 1% decline in the Dow Jones U.S. Real Estate Index, a benchmark index of commercial REITs.

Stocks mentioned:
RYJUX RRPIX XHB SRS

Mar. 5

Larger capitalization exchange traded funds like the Diamonds Trust (amex: DIA - news - people ) and the Rydex Russell Top 50 (amex: XLG - news - people ) sustained the least damage, while the small cap iShares Russell 2000 Index (amex: IWM - news - people ) was down 2.12%.

The iShares MSCI Malaysia Index (amex: EWM - news - people ) was down 6.64%, iShares MSCI Australia Index (amex: EWA - news - people ) lost 5.81%, PowerShares Golden Dragon Halter USX China (amex: PGJ - news - people ) lost 4.3% and the iShares MSCI South Korea Index (amex: EWY - news - people ) was down 1.45%.

The big winners were of course the inverse ETFs that move opposite the markets, with the ProShares Ultrashort Real Estate ETF (amex: SRS - news - people ) up 7.39% for the day. SRS seeks daily moves that are 200% in the opposite direction of the underlying index. U.S. real estate tracking ETFs were hit very hard again.

At some point, prices will settle at levels sure to bring out the bargain hunters. Bargain hunters may want to focus on Thailand trading at 9.5 times earnings, Brazil at 11.9 times, South Korea at 10.9 times, Germany at 13 times, Brazil at 11.8 times and the Netherlands at 11.8 times earnings.

Stocks mentioned:
dia xlg iwm ewm ewa pgj ewy srs

NOTE: The inverse ultrashorts may not truly return 200% of the markets they cover. I've read that some of them-- the ultrashort S&P play offered by ProShares, did not offer a true 200% upside on a down day, but without a source I can't confirm that. If I find it I'll add it here. However, thestreet.com answers has a positive post about the SRS, at least in the short term, and it has gone up lately due to the poor performance in the housing sector. My one concern about these plays is that shares in ProShares ETFs are not real shares (read their prospectus), and they don't have a long enough track record for me to believe that they would make good on their promises if the company became insolvent for some reason or other. In my opinion, you can play them, but not with money you can't afford to lose.

Trading idea:
Buffett buying USG. Buy Jan 09 45 Call .vxeai 5.60

Yahoo:

Re: Under $39, it was abargain of lifetime
8-Aug-07 08:39 pm
If you folks did not buy under $39, you missed the boat big time. I was lucky , just lucky, to load the trucks with Sep 37.5 calls and Jan 08 $30 calls. Sold all 37.5 calls today. Holding $30 calls. When Jan 08 comes near, plan to exercise those calls and be a proud owner of USG. USG will stabalise. Buy more folks. I plan to do. Jerry

From thestreet.com answers and stockpickr.
Cramer favorites:
mo kft k cl pep aapl rimm crox

EMC ideas:

You have been big on EMC. What do you think
about the Aug 18.0 call at $0.55 at close today
(it dropped 30c today)

- Just out of the money
- Expiry next week
- VMWare next week too

Good calls. FWIW, I picked up Sept 16s and 18s when the
dow was down 300 as a complement to my long stock
position.

Aug expirations are cheaper and could work well for
next week's IPO, I just prefer having a little more
time in case of delays or whatever.

Good luck!

Pacific Capital Small Cap held stocks:
dsw hw brcd mstr www

Suck My Nasdaq comment ideas:
lrw (short at 22.2 stop at 23, bracket order trailing cover stop .40, trigger cover 21.1)
emc
mstr (take gains, buy back cheaper mon & ride to 85)
llnw (treasuries violations)
irti (rebound)

Thanks to Alphatrends.blogspot.com for their Technical Analysis.



Stock market video technical analysis for Wednesday August 8, 2007 including; Nasdaq 100 Trust Shares (NASDAQ:QQQQ), S&P 500 Index (AMEX:SPY), Semiconductor HOLDRs (AMEX:SMH), iShares Russell 2000 Index (ETF) (Public, NYSE:IWM), Trend analysis for daytraders and swingtraders of stocks and options. Trading stocks involves risk; this information should not be viewed as trading recommendations.

I read somewhere that one of the hallmarks of the new economy is more bubbles. First we had the tech bubble, then the housing bubble, and now the credit bubble. Tony Dye, the former "Dr. Doom" (so called because he predicted the demise of the tech bubble, years before it happened), said:

"It is inevitable there will be more bubbles," says dot.com crash prophet Tony Dye.

"There is this whole industry that relies on a bull market. So they are going to try to create one."

"And politicians love it because everybody feels good and tax takings go up."

"Let's face it. Nobody is going to get a prize for preventing the bubble that would have happened in 2025."

Mr Dye earned his Dr Doom tag in the late 1990s, when he began predicting the market collapse, some four years before it arrived. He wiped about [pound]8.5bn off the funds he managed by sticking with his value-based management style, quitting the firm in March 2000, just two weeks before the bear market began. Within weeks, his funds rocketed from the bottom to the top of the performance league tables.

The erosion in the Contra Fund's value in recent months follows a repositioning of its portfolio in line with Mr Dye's belief that markets are once again heading for a downturn. However, equities have continued to perform very strongly since the correction last summer.

More:

>Dr. Doom Sees More Market Pain.

Here are some more reports, from The Guild Investment Management forum.:

• WHY THERE WILL BE MORE BUBBLES LIKE THE REAL ESTATE AND INTERNET BUBBLES AND HOW WE PLAN TO PROFIT FROM THEM. Posted Jan 23, 2006.
  
• IT’S ALL STILL HAPPENING: GOLD, US STOCKS, GLOBAL STOCKS, COMMODITIES AND A FEW CURRENCIES ARE SEEING INFLOWS. REAL ESTATE IS SEEING OUTFLOWS. Posted Dec 12, 2005.
  

Stock Notes
Week of 8/6-8/10/2007

The headline risk remains, he says, noting that more negative news or rumors like this week's from lenders Accredited Home Lenders (LEND - Cramer's Take - Stockpickr - Rating), American Home Mortgage (AHM - Cramer's Take - Stockpickr - Rating), Countrywide Financial (CFC - Cramer's Take - Stockpickr - Rating) or Beazer Homes (BZH - Cramer's Take - Stockpickr - Rating) could easily set off another round of woe.