The stock market will bounce back with unusual strength by Thursday afternoon, I believe, and the losses and turmoil that were so prevalent around the globe yesterday - and in Asian markets, today - will recede.
It's not that the global or American markets are healthy - they're all underpinned with mountains of debt that will crumble, probably soon - but that yesterday's losses have already been absorbed in China - whose stock market seems as never before to be leading the world - and the big fall on Wall Street was partly occasioned by a failure of the Dow Jones & Co. software that supports the new "hybrid" stock exchange.
Yesterday's fall took advantage of the timing of Alan Greenspan's remarks coupled to the China shakeout, as well as continuing nervousness about the ability of subprime lenders, banks and brokerage houses to stay afloat when their own risky lending practices come home to roost.
ERHC Energy may have been a microcosm with respect to the bounce we expect. It fell as low as $0.33 before buyers leapt in and took it back to $0.37. The stock at $0.33 was an irresistible temptation. However, it will probably resume its steady but very slow decline until drilling starts and the SEC/DOJ investigations come a cropper (go bust, in Aussie).
While there's no strong reason not to buy ERHE at this level if you are a long-term player, patience will probably be rewarded with a discount up to another 5 cents. I have been hoping for another shot at $0.27 shares like those that made me so much money last year.