That Was The Week That Was – Last Week September

•   Last Monday markets opened to good news from Asia and Europe but domestic indices meandered as traders took profits from a fairly outstanding September.
• Graham Summers, in his ‘Seeking Alpha’ Weekly Forecast,  reported that the previous week the Fed injected more than $10 billion into the markets via three Permanent open Market Operations and another $10 billion into the system via ‘behind the scenes’. This ‘trashing of the dollar’ in order to bolster stocks could mean a major weakness in the Dollar, which would cause stocks to retest the April highs of 122o (on the S&P) and Gold exploding to $1350, or higher. (Weak dollar good for stocks!).
• Very interesting, Canadian and US stocks in lockstep both retreating last Monday as investors on both sides sold off financials.
• IPO woes. Ze hottest IPO in years gets lukewarm reception- Liberty Mutual.
• Hey, I told you first! Emerging markets are not just a satellite but investment planners believe a Core Holding.
• Some of the hottest markets are South Korea, Taiwan, the Philippines, Singapore, Malaysia, Indonesia and Thailand. These are called the Asian Tigers . Hot they will stay and grow for some time. You can buy them in an emerging markets fund or individual exchange traded fund.
• Home prices in the Detroit Metro area increased 1.6%.
• Markets up on the bet of Fed intervention and tons of cash in corporate coffers.
• Currency wars, it is called by WSJ. Global economies survive on their cheap money as exports are life blood. China rules with bogus cheap currency and U.S. is getting the message and making the dollar less expensive than their friends and neighbors.
• Weird or just me? The CBS’  Hawaii 5-0 attracted 12.5 million viewers and Sarah Palin and Dancing with the Stars garnered 21.5.
• Before the bell Thursday- Irish banks need more money, Spain downgraded by Moody’s. U.S. taking China to the woodshed because of it’s currency policy.
• Last Wednesday the U.S. House passed legislation to penalize China’s foreign-exchange practices. Currently the Yuan is undervalued to the U.S. dollar by 20%. (Now you know why you can buy tidy-whities so cheap – one reason is the exchange rate – second the average income in China is 25% of the U.S. average income-)
• On Thursday China gave a ‘muted’ response to the U.S., a politically correct word to express their concerns and willingness to ‘work things out’. They are buyers of our debt and our consumer supports their economy. We each have something to lose and gain.
• Question: If dollar continues to fall and stocks to rise the end result is? Answer: It’s a tie ballgame.
• Liberty Mutual (see above) pulls plug on IPO. Investor resistance to premium stock valuation and lackadaisical institutional interest almost certainly would cause insurance giant to nosedive. Good call. 
• Thursday markets were in for a bit of profit taking on the end of the month with indices down slightly.
• The world famous investment bear Peter Eliandes of Stockmarket Cycles may just change his mind on the direction of the market ‘after’ October 1st.
• The best September since 1939 breaking the rule that with a bad August comes a bad September. Markets gained 7.8% for the month.
• AIG plans on starting to pay back the $120 billion loaned by the government by first converting common to preferred and increasing ownership to 92% from 80% and allowing the Treasury to sell shares over time.
• More problems for Irish banks as the weakest in the union. Expect more grief coming from that sector.

Questions call Paul @ 877 783 7080 or write him at pstanley@westminsterfinancial.com. Share this blog with someone who cares about their money.