Well there's nothing like a complete market meltdown to make you question every move you make.
On Wednesday, the market began to stage an impressive comeback. The Fed jumped in with a rate cut, the stimulus deal was underway and a lot of strong earnings were forecast for today.
Unfortunately, many counted their post-meltdown chickens before they were hatched.
Relief quickly turned to panic again around 12:00 this afternoon as the market started giving up early gains. But really, what did we expect?
The problems that led us to this most recent implosion won't magically disappear with a panic-driven rate cut, billions of dollars worth of rebate checks and a quick round of strong earnings that, you know as well as I do, will be overshadowed by the next round of dismal earnings.
Meanwhile, the headline "Societe Generale Apologizes Over Fraud" just happened to have made its way into my spam folder exactly 7 times today (I'm still a bit sketchy on how exactly one trader pulled off a $7 billion fast-one), while rumors of possible trouble with another hedge fund hit the news wires. Though until stories like these become validated, it's difficult to separate truth from manipulated truth.
Regardless, none of this is going to contribute to an extension of yesterday's rally.
But then again, no one should've really been that surprised. Even without that laundry list, after coming off two days of heavy gains, it's normal to expect investors to take some profits off the table when the market is this shaky.
The question now is-how do we proceed?
For the answer to this, I'll have to draw on something a truck driver told me in Indiana during a tornado alert in 2003. Being unfamiliar with the protocol during a tornado warning (we don't get many of those here in Baltimore), I asked him what we were supposed to do, after I heard the warning siren. He said, "Hold on to your ass, and sit tight!"
If you're in this thing for the long-haul, then you probably know that selling into something like this will only leave you kicking yourself later. Of course, if you're a trader, then this is certainly a good time to go hunting. But that requires a level of cojones that even I'm not willing to take on for at least another week or so. In the words of my colleague, Chris Nelder: "No need to be hero right now."
That being said, when the smoke does clear, there will be some excellent buying opportunities. Until then, it just seems to make more sense to focus on what's going to move us forward tomorrow...not what's dragging the whole market down today.
And market meltdown or not, the green sector continued to advance this week. It's just that few could pull themselves away from the avalanche of bad news long enough to see much else.
Probably some of the most exciting news for us came out of Brussels this week when it was announced that the E.U. had released its latest climate change proposal that would require a target for supplying 20 percent of its energy needs from renewables by 2020.
Folks, this target will only help contribute to the already strong renewable energy momentum in Europe.
We expect to see some of the biggest opportunities stem from the wind energy market (especially the offshore variety) in the UK. The British Wind Energy Association expects to see between 6,000 to 7,000 offshore turbines by 2020. That could provide about 25% of the country's electricity.
And Italy and Spain are projected to offer up some serious growth in solar this year too. In fact, it's because of Spain's aggressive solar initiatives that two of our solar plays, one in Green Chip Stocks and another in the Alternative Energy Speculator, continue to deliver.
The carbon trading industry is expected to gain a lot from this proposal too.
There was also another interesting piece of news this week that didn't get nearly the attention it would've received had it been released during more stable market conditions. That little electric car company, Zap (OTCBB:ZAAP ), announced earlier this week that it had received an order for 30 of its electric trucks from Montevideo Refrescos. This is a subsidiary of Coca-Cola (NYSE:KO). Montevideo plans to use the trucks for deliveries in Uruguay's capital.
And finally, on Tuesday, Lockheed Martin announced that it was expanding its business operations to capture the private energy-management market. Apparently, the military behemoth doubled sales of its energy conservation services to private companies in 2007.
Of course, we're not surprised. This is a sector that's expected to be one of the most profitable of 2008. It's a short-term fix to a long-term energy crisis. And it's a hell of a lot cheaper than building new power plants. Rest assured, we'll continue to cover this sector throughout the year.
To a new way of life, and a new generation of wealth...
Jeff
For more on alternative energy stocks , visit the Green Chip Stocks home page
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