Tide turned

November 4th, 2006

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The US stock market tide is turning, after being spooked by the latest batch of economic data suggesting that the economy may fall into recession. Last Friday, the Dow Jones retreated back to below 12,000 points?the first six-session drop since mid-2005.

We are not the least surprise by the fall. As we said before, the financial market is currently at an inflexion point, which is the point of confusion. As such, market sentiment will be seesawing with no clear conviction. Our conviction still stands?the US economy is very sick and by implication, the stock market will eventually follow. For us, we are hedging our financial well-being with gold.

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