The Asian factor

Greenspan, Bernanke, Paulson and all top-spins will not achieve a real estate turnaround for 2007. The bubble was so big, similar to the internet stocks, that the burst will be definitely also similar.

Look to this: Sales of previously owned homes probably will tumble 4.6 percent to 6.18 million and the U.S. median home price likely will fall 1.3 percent to $219,100.

No matter the influx of money to the US, the GDP will be lower for the year: The U.S. economy probably will expand at a 2 percent pace in 2007, compared with 3.3 percent last year.

Even tough, the world economy is in good shape. It is the first time, probably since the last 20 or 30 years, that a near-crisis in the US will not mean a world crisis. It is the Asian factor.

Greenspan and the Chinese bubble

We all know that Alan Greenspan has made a big masterpiece in the international markets, in the last part of the 20th century.

Even, after leaving the Fed, any remark from Mr. Greenspan make some noise. But, as always: good noise.

Mr. Greenspan, right now, is telling us about China. In this case, what he has said, doesn't surprise us: former Federal Reserve Chairman Alan Greenspan warned a big correction is due in Chinese stocks.

We do not believe in trees rising to the skies. The bubble in Chinese stock market, will burst, right now, or 3 years from now.

Investors, with or without speculative behaviour will be burned. Just because of that, the warning from Mr. Greenspan it is very healthy.

Recession, definitely

Master Greenspan has warned recently, about the incoming recession.

King Buffett has mentioned several times, some dirty pieces of the American economy: twin deficits, too much dependence on consumer spending, and a public budget unmanageable.

Right now, Bernanke says something that we think is not a doubt, it is real: Federal Reserve Chairman Ben Bernanke said Wednesday uncertainties surrounding the U.S. economic outlook have increased somewhat recently.

We prefer to listen to Mr. Greenspan and to Mr. Buffett.

Recession?

Master Greenspan has warned. Mortgages and real estate are the main sources of recession. But America is living also an innovation crisis. Motorola is in turmoil. Dell is stuck in the mud. Automakers are near bankruptcy. What is happening to America?

The White House is in a permanent crisis of credibility. Iraq and Afghanistan are on fire. The Defense Budget is unsustainable.

Will Obama be the new face of America? Or America is facing the decline of the empire?

FED: rethinking the rates?

Mortgages, real estate, twin deficits and "war on terror" budget, are damaging US economy.

Master Greenspan has warned, about a possible recession. Bernanke have dismissed the Greenspan thinking without clear evidence.

Now, the market is waiting for rate cuts: Options traders are starting to say the Federal Reserve may cut interest rates three times this year as the housing slump threatens the economy's growth.

We always believe in Market. After this, Bernanke will be in a turmoil: to tackle some inflation threat, or to put some gas on the economy.

Master Greenspan

He said: the U.S. housing sector was experiencing an "inventory recession." However, he also said a bottom had been hit in the decline of U.S. home sales.

The "io-io" economy!

Mini crash?

After the warning of Mr. Greenspan, about a possible future slowdown, Chinese investors had a bad day: Chinese stocks plunged nearly 9 percent Tuesday, erasing about $140 billion of value amid fears that authorities would crack down on speculation that drove shares to record highs.

Be cautious! Value investor behaviour will be the best in such times.

Alan comeback

When you read this: "For example in the U.S., profit margins ... have begun to stabilize, which is an early sign we are in the later stages of a cycle". And you know that these words are from: Former U.S. Federal Reserve Chairman Alan Greenspan warned Monday that the American economy might slip into recession by year's end.

You need to be cautious. And, Alan made an additional warning: "The American budget deficit is clearly a very significant concern for all of us that are trying to evaluate both the American economy's immediate future and that of the rest of the world".

Nasdaq pattern seems a little bit exhausted!