Look out below

Last week a client portfolio that is what I call a global balanced account:  60 percent stocks, 40 percent bonds and cash and evenly split between US and Non-US assets; cash and bonds more heavily weighted to Non-US assets had an intra-day move of 2 percent.  Up one, down one and closed down a half percent.  That in itself sent chills up my spine and I noted the move with another client at lunch. 

This morning Turkey is considering an invasion of Iraq and oil is over $85 per barrel.  A consortium of banks is pooling their money to buy illiquid securities no other portfolio managers are brave enough to buy for their clients. 

I got spooked this morning and liquidated all bets, and cut some core equity ETF's.  I recommend you eliminate all speculative bets (CSCO, WFMI) and reduce equity holdings around the world.

Interesting enough, I think people will appreciate the security of the world’s greatest military and buy dollars, so all my proceeds will remain in dollars.  Look for FXE to fall back to 135.

Posted by Bradley Fluetsch at 10/15/2007 5:59 AM
Categories: Speculation
 

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