Our e-Market Letter is geared to market timing and strategic asset allocation for money managers, individual investors and students of the Wave Principle. Published once a week, with interim bulletins as necessary, it includes everything you'll need to be optimally positioned for the Bear Market. Optimal positioning translates into optimal profit.
What differentiates Exceptional Bear?
1) Real-time, intra-day market updates to make sure reversals are spotted and acted upon in a timely manner.
2) Coverage of several of the most profitable market sectors with just one subscription.
3) Direct and to-the-point buy & sell recommendations for each market sector.
4) Proven track record of excellence as evidenced by TimerTrac verification.
Final Blow-out Stage
The Bear Market Rally which began in 2004 is not over. We must complete a Blow-Out phase to new highs in the Dow before the peak is in. We estimate that will come in the 3rd Q of 2009. Once the current base bottoms, in the next several weeks (6-8-08), get ready for an all-out market orgy, where profits accrue beyond belief. You will want to be in on it early, to reap the big gains. In the interim, we can guide you to making the most of the Bear.
How do we know the Bear Market began in March 2000, and still has a long way to go?
Recession/Depression proof Investments
Make no mistake about it. "With good timing, optimal positioning and a bit of judicious leverage, the next 12-15 months will be profitable beyond your wildest dreams, as long as you're positioned to take advantage of the frequent reversals."
Buy & Hold vs. Timed Trading
According to a recent research study by Dr. Prieur du Plessis and Jeremy Grantham's GMO the expected return on US stocks over the next ten years is 5.7% based on historical P/E ratios and 4.5% based on dividend yield, with a probability of high volatility and negative returns. Meanwhile, our Exceptional Bear analysis projects a 17% minimum decline this year. The fundamentals behind this analysis are clearly the tremors being felt in the financial system over the sub-prime contagion. These tremors are early warning signals of a major earthquake in the Financial system. So why would anyone in his right mind set himself up to lose under such odds? It's totally unreasonable. To paraphrase the legendary value investor, Jeremy Grantham, you might beat the odds one year, but longer term you're bound by mediocre returns at best, and tragic losses at worst.
Stock Picking vs. Market Timing
In Bull Markets, as we have seen for most of the last 72 years, picking the best stocks and holding them for a long time made allot of sense. Those times were ideal for the likes of Warren Buffet and my former boss, Mario Gabelli. However, trying to outperform by picking stocks in a declining market is like trying to grab a falling knife, no matter how lucky you are, you're bound to get hurt. That's why, as we enter the third leg of the Bear Market - Market Timing is absolutely crucial for success. Picking stocks in an attempt to outperform in a falling market will simply mean losing less, since everyone holding stocks will lose. Warren Buffet & Co. prepare yourselves for a dramatic reversal of fortune!
"No one can time the Market"Because most market participants can't time the market, they can't imagine that anyone else has the capacity to do it either. A bit arrogant, wouldn't you say? Timing the market is difficult, and in in the words of Robert Prechter, "only one in a thousand can do it well". While we don't attempt to catch every turn, we can time the big one well enough to save you from catastrophic losses, and most likely make more money in the next twelve months than you've made cumulatively in the past three years.
Diversification
Diversification for its own sake is for those who don't know what they're doing. We identify trends and make money by focusing on the very best of them, those in the third wave. In today's "Flat World", as so eloquently described by Thomas Friedman, all markets are highly correlated, meaning they will all likely rise and fall all at once, so diversified portfolios are guaranteed losers. The notion that diversification will allow you to offset losses in one market with gains in another, is false and highly treacherous to your net worth. In the third leg of the Bear Market, the person who has all his eggs in a basket of well-timed, intelligently selected shorts, will do very well, while everyone else gets killed.
When the market bottoms, we likewise have the road map to time the reversal, and get in early to reap the big gains. When everyone else is pessimistic we'll be going long, in time to catch the third wave up of the next Bear Market Rally.
