Recession On

While stocks are currently cheap, the unfortunate fact is that housing is going to get much worse, and the effects are going to be felt over a long period of time. I believe the stock market will fall for the next 4 to 12 months (let’s call it 6 months) and that we are in a bear market. If that’s all true the market should fall about 15% more from here. Stay away from financials/mortgages/real estate.

My prior recommendations [BAC (+1.18%), C (-6.52%), WB (-18.12%), BBY (-9.22%), JOSB (-6.95%), BWLD (+15.47%)] averaged a loss of 4.03%, which underperformed the S&P 500 by a whopping 6.32%. I recommend at this time SKF, JNJ, PG, BUD, FMX, WNR, DNA.

Overall record since I began posting recommendations on this blog on 7/31/07 has been -6.81%, compared to the S&P 500's -5.93%.