Looking at the Market on a Trend Basis

Today’s Headlines are Negative
“NEW YORK (MarketWatch) — U.S. stocks on Tuesday took their biggest single-day hit in more than three months as investors fretted about Ireland’s debt crisis and possible rate hikes in China. The US dollar showed surprising strength and gold fell.”

Yesterday’s Headlines are Positive
New York – Retail sales are increasing. Unemployment claims are dropping for the first time in months. Retail sales showed an unexpected rise in spite of analysts’ projections that retail sales would fall. The US dollar fell against all major currencies. Bloomberg – German Investor Confidence Gains More Than Forecast By Jeff Black – Nov 16, 2010 “German investor confidence rose for the first time in seven months in November as the economy, Europe’s largest, powered ahead of its euro-area neighbors.
The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations, which aims to predict developments six months ahead, increased to 1.8 from minus 7.2 in October. Economists expected a gain to minus 6, according to the median of 33 forecasts in a Bloomberg News survey.
Germany’s economy will expand 3.7 percent this year, according to the government’s council of economic advisers. That would be fastest growth since 1991. The performance contrasts with fellow euro-region nations such as Ireland and Greece, whose economies are contracting as their governments slash spending to rein in budget deficits.“


Follow the Trend, Don’t Follow The Headlines
So here we have dramatic attention gathering headlines on two successive days that seem to indicate the opposite trend to each other. How does one deal with this?

As we have said before, one must ignore the talking heads. One must ignore the screaming headlines. This is media generated excitement. The media must produce excitement or no-one will pay attention. No-one will buy the newspapers, or watch the programs, or read the electronic media.


Follow The Trends
The world suffered great losses, but people still have to eat. Great buildings and infrastructure are still being built. The population worldwide that can afford luxuries is growing daily, in spite of current economic problems in the US and Europe.

What one has to remember is that cycles have come and gone and cycles will continue to come and go. What we have currently is a financial balance, although tenuous, between the old economies and the new economies. Since the financial fall was dramatic and severe, the recovery cannot be instant, but it cannot be denied or prevented. The economic world will recover.

Do not fall victim to fear and talking heads. Buy when reason and trends tell you that the time is right. Maybe the current time is right, or maybe a bit early. We are investing in basic commodities that will always be needed by an expanding society. We think a reasoned position now is proper. Don’t buy at the height of the cycle, when those financial executives are selling garbage to the unsuspecting.

By Larry Cyna

Mr. Cyna is an accomplished investor in the Canadian public markets for over 20 years, and has managed significant portfolios. He is a financing specialist for private and public companies, and has expertise in real estate and debt obligations. He has assisted private companies accessing the public markets, has been a founding director of public companies and continues as a strategic consultant to selected clientele. He is and has been a director, a senior officer and on the Advisory Board of a number of TSX and TSXV public companies in the mining, resource, technology and telecommunications sectors, and the Founding Director of two CPC’s with qualifying transactions in mining and minerals. He was an honorary director of the Rotman School of Management MBA IMC program, has completed the Canadian Securities Institute Canadian Securities Course & Institute Conduct and Practices Handbook Course, was a former Manager under contract to an Investment Manager at BMO Nesbitt Burns, a roster mediator under the Ontario Mandatory Mediation Program, Toronto, a member of the Institute of Corporate Directors of Ontario, a member of the Upper Canada Dispute Resolution Group, and the Ontario Bar Association, Alternate Dispute Resolution section. He obtained his designation as a Chartered Accountant in Ontario in 1971 and was the recipient of the Founder’s Prize for academic achievement together with a cash reward. He became a CPA in the State of Illinois, USA in 1999 under IQEX with a grade of 92%. He is a Member of the Institute of Chartered Accountants of Ontario and the Canadian Institute of Chartered Accountants. He holds certificates in Advanced ADR & in Civil Justice in Ontario, Faculty of Law, University of Windsor, certificate in Dispute Resolution from the Ontario Institute of Chartered Accountants. Previous accomplishments are Manager of Cymor Risk Consultants LP specializing in Risk Management Assessment; CEO of Cyna & Associates specializing in mediation and ADR; Founder & Senior Partner of Cyna & Co, Chartered Accountants, a fully licensed and accredited public accountancy firm with international affiliations; and was a partner in a large public accountancy firm. Mr. Cyna is well known in the Canadian Investing community. He is invited to, and attends presentations given by public companies usually 3 or 4 times each week. These presentations are intended by the various hosting companies to present their inside story to sophisticated parties and Investment Managers for the purpose of attracting funding, or of making parties more interested in acquiring shares of those companies. Being a part of this keeps Mr. Cyna deeply involved in the current market and leads to numerous investment opportunities.

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