How Deep

One of my favourite songs is, "How Deep is Your Love".

But one of the most favourite topics in the global finance now is,

"How Deep is US's Recession?"

So, let's all go back to the Staring Point of this current WWIII - US.

Now, not only the financial sector, autocar sector etc. (and soon retail sector and airline sector) are knocking on the doors of the US Government, even the law firms are collapsing, some of them have been around for decades, few of them were once in the most profitable hundreds and very few of them even were once International Big firms. They just collapsed outright.

And there are 50% rise in corporate bankruptcies (now at over 18,400) for the first six months of this year when compared with the same period last year.

http://www.nytimes.com/2008/11/12/business/12law.html?_r=l&ref=business&oref=slogin

And the housing market just got worse because the house value continues to fall - even some bought them quite recently at what appeared to be bargain prices. Some smaller towns are having an Unemployment Rate already over 10%!

It is estimated about 25% of house with mortgage in US (i.e. about 9.7 million homes) are either "Underwater" (i.e. Negative Equity) or "Within Striking Distance of becoming one"! More and more people are now cutting expenditures, spending more time at home!

http://www.nytimes.com/2008/11/11/business/11home.html?ref=business

And Wall St dropped by about 2% overnight, with GM dropped to US$2.90, a 65-year-low!! An analyst just downgraded it to "Sell", claiming its Target Price will be - have a guess?


Target Price will be...........


Yes....$0!!

So, if anyone thinks that my Target Buying Prices for HSBC are too Low, think Again - they have not seen the real effects of this current WWIII have on the share prices YET!

Even the Merrill Lynch Chairperson and CEO has finally joined a few Visionary Investors in stressing the current Recession could only be compared with the one in 1929!! He also reminded others the current Recession is "Contracting Sharply."

www.ft.com/cms/s/o/834ebf5e-aff9-11dd-a795-0000779fd18c.html?nclick_check=1

I believe not only the current WWII would result in a Sharp recession but also a Prolonged One.

So, please do NOT Rush to Buy YET.

Fate
Rushing is Regretting