Today's Trade & News

Dear Members,

USA REAL ESTATE MARKET

In 2005 and 2006 I warned about the real estate market heading towards a weak trend and we can now see signs of pain. The problem in the real-estate market is spreading and it will continue to grow like a complex and unresolved puzzle. Many people and investors think that the FED should do something to salvage the situation, but is this problem created by the FED? The answer is No, as the problem has been created by speculators, greedy institutions as well as investors who went in over-buying by over borrowing. If the FED tries to resolve this aggressively, then there will be enormous side effects in the longer term, so it is better for FED to wait for sometime and market will bring a solution itself.

My astrological calculations indicate no turn-around in the real estate market for the next two and half years. The problem will now move to the UK and Europe, but the UAE will be the worst hit. I was in Dubai for a year and last year I warned some investors but unfortunately, no one wants to believe what I have to say. As a matter of fact, they believe that this market will grow 30% every year for the next five years. However, I see the worst crash of property prices in history from the end of 2007 onwards in that region. This will be in DUBAI or UAE or the hot rising region in the middle-east as well as some part in Asia. Once again, I advice to those who willing to buy property to wait for a few years and they may get it 25% cheaper in the USA, 40% in Europe and 60% in the middle eastern region like the UAE.

Coming back to the USA housing and job problem, 18^th September 2007 will be the most important day in each trader’s career because we may get a clue concerning the current uncertainty on that day. However, I don’t see any solution being revealed but we shall for sure have plenty to talk about. Everyone is expecting a 0.25 basis point cut and a few believe it will be 0.50 point (we all know minimum 0.25% point is there), but I won’t be surprised if they remain unchanged. In my view if they keep unchanged, it will be encouraging that, FED or Bernanke have enough confidence in its policy as well as in the USA economy. If they however move in an aggressive manner, it will give us a clear signal that all is not well as regards the policy as well as the economy. That is why I give so much importance to the 18^th of September.

I still believe that the USA economy will remain stable in the longer term compared to Europe. I won’t therefore put even a single dollar of mine in Europe because it is a sinking ship. Unfortunately, at this stage no one realizing this so please beware and once you see sign get out from there.     

Currently, all is not well and I get a very negative feeling from nature when I read charts. This is therefore a warning that there will be a terrible time ahead in this month for the world financial market.

In future Asia will have a key role to play in the world financial market and the world economy, but the time ahead will be very competitive for these countries as well.

Stock markets are key indicators of the economy and the current shake-up in the market compels us to ask whether all is all well in the world. According to me, these are initial signs of a worst wave which could wipe-out many secure and unsecured investment places, and I am talking about financial companies and institutions. One should therefore remain alert and I will continue to remind you from time to time until we get to a safe period.  

There will always be opportunities whether times are good or not, and we should therefore focus on those opportunities when it can benefit us.