Well, where to start this weekend is the real challenge! "Toilet Roll Holder Company Goes Down the Pan" was a headline that tickled my son's sense of humour (kids, eh?) but it's not that amusing for some of the good people in Axminster who are in the process of losing their jobs. And there's nothing too funny either about the collapse of Seguro Travel and XL Leisure - an awful lot of hassle there - and the UK taxpayer will have to pick up some of the tab because the Civil Aviation Authority's relevant fund is short of £21m at the moment. Expect that deficit to rise as more of the same happens over the coming months. And while on the subject of travel, it seems that while I was away gallivanting in extremely Northern climes the other week, a Ryanair flight to Barcelona had some kind of problem that resulted in 16 passengers having to be treated for earache. Michael O'Leary must have been on that plane then.

And certainly some frayed nerves at the London Stock Exchange when the computers crashed - imagine all the profits you "could have made" if things had worked properly...... you should sue 'em! Talking of which, lawsuits are certainly in vogue - a real growth industry as mentioned previously in these ramblings. (Type "blame game" into the search engine.) It seems that fees paid out by the NHS to lawyers have increased by 122% in the past four years, to £90m. Across the pond, some of the disgruntled shareholders in Fannie Mae are suing the ex - execs thereof. It was ever thus when things go wrong. And carbon trading is producing big sums for many UK companies - so a few sectors of business are doing just fine then. (see WICS of 6th and 13th May 2007 re mention of carbon trading - and type "scam" or its plural into the search engine if you can be bothered.)

More headlines/pronouncements from "those who ought to know better" - I'm not sure which is the most amusing, but in terms of "divorced from reality" this one certainly takes the gold medal: "Britain is well placed to ride out the credit crunch". (wee Allie at the TUC conference.) In the silver medal position we have "The Bank (of England) will continue to provide liquidity for a shortish period." That came from governor Mervyn King and refers to the continuation of the scheme that allows UK banks to swap dodgy debt for gilts, in order to let them continue to borrow in order to stay above water - at the ultimate expense of the taxpayer of course. I just love that "shortish period" bit. How long is shortish? Finally, in bronze position is the claim that "Estate agents are selling one house a week." Gosh, I hadn't realised things had improved so quickly. Further down the field, there was the NFU pronouncement (National Farmers' Union - field - geddit?) back in June that "UK farmers are looking forward to the best harvest ever..." On Friday, that statement had been somewhat modified to read "worst harvest in 40 years." As per a line from a Kenny Rogers song mentioned in WICS of 17th June 2007, it's not a great idea to "count your money while you're (still) sitting at the table".......

Anyway, moving on, it seems that Barratts (housebuilders) are having a bit of a "summer special" - buy one, get one free....but seriously, their current "incentive" package is clutching at straws, as mentioned in the midweek video updates.

And the London Underground surely has burrowed its way to join up with CERN in Geneva - seemingly it too is facing a "black hole". A £3bn funding shortfall to be precise - another example of why IW is totally certain that the Broon one was/is the worst UK chancellor ever. I see he's taking the cabinet to Brum - is that to get it repaired? And as for the increase in cold weather payments to pensioners.......he hasn't increased the temperature at which they're to be triggered though. What a scam.

That last observation almost smacks of "being political" but you may be totally and utterly certain that is not the case. Oh yes - still on that general topic - it seems some lady has been sacked by the Broon one for daring to suggest he should face a leadership contest. Leadership? Gordon? That thought reminds me of the Talking Heads song: "We're on a road to nowhere..." Anyway, what got this fella riled was the reference to the lady as a "vice chair" of some committee or other. What is it with the media? A chair is a chair, for goodness' sake. A chairman or a chairwoman presumably sits in one while taking charge of a meeting. ("Terms IW detests"....a longish list, the older and grumpier I become.)

Moving along very quickly, and back in the US of A we see that Lehman Brothers is bust - you may recall the odd mention in these ramblings, that there was "a lot more to come" anent the overall credit/debt meltdown - and Lehman won't be the last by any means. Washington Mutual next? (One of the USA's bigger banks) And as regards other institutions, how about AIG? (huge insurance company, soon to become a lot less huge?) As frequently mentioned here, my Really Scary Granny's crystal ball is almost overheating with all its predictions of "More where that came from" (a Dolly Parton rendition, if you're interested) - a whole lot more methinks! What price another Fed interest rate cut on Tuesday? We'll look at the AIG chart below, just by way of indicating that you can generally tell a fair distance ahead, when something is getting pretty dodgy. And Warren Buffet's company (Berkshire Hathaway) has stopped insuring US banks.......go figure, as my Yank brother in law so quaintly puts it. (Even Mr Buffet's magic is fading a wee bit - his company's shares are down 25% from their peak. But there again, a single share still costs a tad under $12000....)

Back in the UK, John Lewis profits, not surprisingly, are considerably below target - but equally predictably, their head honcho is claiming that "our new store plans remain on track." On track to where, precisely?

Finally before the customary lie down in a darkened room, it seems the ECB is now suggesting that it won't only be the UK that goes into recession this year - still behind the curve as usual! And Japan looks to be heading the same way - the only thing that's growing there is the average age of the population. 36200 centenarians at the latest count! In truth, ALL economies are now headed for recession - even China and India.

Just before today's charts, here's an email from "Mark" and my reply thereto, which may be helpful to a few of you.

Subject: Bovis and Bellway

Ian,
I have been watching these for a while now. I have been seeing an up channel in a prior down trend. So I have been looking for a probe down and then a retrace as per TTEW. I now see(?) a probe out of the prior down trend that could now make this a buy. The very fact of buying one of these given the economic and market conditions does not make sense to me. However you have said in the past that the charts trump the economy.
I am doing nothing because I do not know what to do..... however I welcome your views as well.
Regards
Mark

My reply was:
Mark - you DO know what to do if you're doing nothing re these meantime!
Charts trump the economy, yes, in normal circumstances - but these are far from normal circumstances. Housebuilders - some of them - WILL rise but it will need a buyout for it to happen, & for now, nobody with money would bother because they'll be a lot cheaper before they hit the bottom.

On that note, today's charts - and first AIG just to show you how far it has fallen. Then we'll see if maybe - just "maybe", mind! - there are counter trend channels in Stagecoach and Imperial Energy, suggesting that these stocks may have some potential to rise in price. Not everything falls in a bear market, as has so often been mentioned here - but certainly "buys" are far harder to find at the moment than are "sells" and that is going to be the case for a fair while to come. Does it matter? It shouldn't to a trader! Only "investors" need rising prices - and there are very few happy investors at the moment!

Anyway, that's all for this weekend. There won't be a WICS next weekend - very good friends are arriving at an airfield near us on Thursday evening and leaving after lunch on Sunday - a surprise "Big Five 0" treat from the children to their Daddy. (He's not a trader so he won't be reading this to spoil the surprise.) A limited amount of falling down liquid therefore (possibly) may be consumed over the weekend and there is unlikely to be time to put together anything semi coherent. All being well, the video updates will be produced as usual though. The next WICS will be on September 28th, so happy trading until then!

Ian.

'IMPORTANT NOTICE: These WICS charts are for EDUCATIONAL PURPOSES ONLY. They represent only MY understanding of what is happening in the market for any particular share, stock, commodity or index. In NO circumstances should they be construed as recommendations to trade. If I choose to trade what I see, that is MY decision. YOU must, in turn, come to YOUR OWN conclusions about what action, if any, YOU might choose to take'.