Out of the Woods? Commercial Real Estate says Otherwise.

Posted by BobL on 9/10/09 • Categorized as Bob and Scott Originals

We might be turning the corner in our recovery (at least that is what the talking heads are saying). I am not convinced. I have been wrong quite a bit lately. I moved to about 35% cash last week and missed this last bump. I placed a bet against AIG holding above $34 (I think it is headed back to the teens soon) and am losing that one.

We are not out of the woods here, but the tail might just wag the dog as it did on the way down. This economy is not great.

I am not positive what the next catalyst will be to move us up or down, but it appears it is going to take a lot. Wall Street players (GS) are moving money by the billions and practically printing profits. According to Meredith Whitney, the banks and real estate are far from out of the woods. She predicts many more bank failures along with a potential 20% decline in housing prices.

Any strong indication of that being the case could cause a short term panic.

I am going to be patient with my position here. I might make a longer range play with AIG. I can’t stomach the fact that this company is worth less than $0, yet trades above $35 per share. Bad. The parts do not equal the whole!!

More about the commercial real estate troubles by following the link below.