Greed is NOT Good!

You don’t need the Inspector to tell you that the markets are in trouble. The Toronto Stock Exchange plunged more than 500 points in early trading Monday, following steep declines in the European and Asian stock markets amid investor pessimism over the U.S. government's stimulus plan to prevent a recession. Precious OIL is down below $90. The key point of all of this, besides the pain and bloodshed, is that the US Fed WANTS commodities to take a hit. They want oil prices to weaken. What this means to investors is that right now commodity stocks are on sale. However, this does not mean all stocks have bottomed.

Best advice the Inspector has is to limit your exposure to over-valued stocks. For example, Potash recently crashed back to earth. Back in December the Inspector profiled Potash a second time, after a huge run up. I sold a significant portion of my holding and hopefully you followed suit if you were in a similar circumstance. Within a few weeks after selling a significant portion of my holding, Potash ran up even further. Rather than kick myself for missing $146, I was happy to have locked in a profit and now that is has come crashing down I can arrogantly say “told you so.” Never get too greedy! When you have a chance to take 15% off the table, especially with a volatile stock in a volatile market, do not hesitate!

The Inspector’s new year’s resolution is to be extremely vigilant about the investment advise published. 2007 was a good year, but 2008 looks to be a very tricky year and nothing can be taken lightly. One of the improvements for the InspectorSTOCK.com blog will be more frequent updates on all stocks mentioned. Often times a stock is profiled and not revisited once circumstances change – the Inspector does not want to mislead. For this reason, the Inspector will regularly update all stocks mentioned. None the less, the onus is always on you the reader, to research fully any investment advice presented. Don’t trust anyone! Certainly not me! Trust the facts!

SELL! In case you did not read the 2007 Inspector STOCK re-cap, several stocks have fallen out of favour with the Inspector since profiling them. They include Canadian Tire and KRY. This was communicated January 1st 2008. The Inspector now adds to the sell list, Rogers Communications.

BUY! Petro-Canada is a good value. Be prepared for ups and downs – long-term though, this stock will gain modestly and allow you to sleep at night.

In the next blog entry, the Inspector will profile a company not covered before that will allow further restful nights. A conservative stock that you can count on during a very perilous investment climate. Have no fear, the Inspector is here!

DISLCOUSRE: I own shares in Petro-Canada, Potash, Rogers and CRYSTALLEX. Chavez is a commie bastard!