Good morning!

I did 5 more quick company updates last night, so here is a link to yesterday's full report.


Difficult market conditions

I don't suppose any readers need reminding that it's ugly out there at the moment. Probably like most people, I'm weighing up whether I should be cutting positions more, or just ride out this downturn? The trouble is, cutting positions often means that you miss out on the explosive rallies which are a feature of bear markets (and this is increasingly looking like a bear market). So better to sell after the big rallies, rather than panic and sell right at the lows, perhaps? Oh, for a crystal ball!

Bargains are appearing, and I have been (perhaps foolishly?) buying shares that I particularly like, at attractive prices. The trouble is that a PER may look low at first sight, but if earnings have peaked and are now likely to fall, if Western economies go into recession again, then we don't really know where we stand about future earnings, and hence valuing a share.

That will be a key theme in my interview with Somero Enterprises Inc (LON:SOM) management this afternoon - last call for your questions, using this form please.

We could be getting close to the point where markets rally strongly (it's amazing how quickly sentiment can turn when some good news comes out). Or we could be on the cusp of things getting worse, if there's some shock to the system. Are things really so bad, to justify such a big sell-off?

Thinking back to 2008, what really clobbered the markets was when systemically important financial institutions started failing, or needing bailouts. This time around, banks' balance sheets are very much stronger, and politicians & civil servants know what to do - they have to act fast, and shore up big financial organisations, to prevent contagion. So it seems to me perhaps unlikely that things will get as bad as 2008 this time around, but I reserve the right to retract that remark at any time!

What am I doing with my own portfolio? On my long-term, ungeared portfolio, I've trimmed a couple of positions slightly, but that's it. On my shorter term trading accounts, I've cut the gearing right back, and hedged with short positions. So far that's worked well.

As I've mentioned many times before, I had a…

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