Stock Market Strategy For Big Profits

Buying the best growth stocks at the right time certainly can make you decent money in the stock market. If you want to make really big profits, adding to a winning position at the right time can achieve this for you.

First, if you have any losing stocks, sell them. This will give you extra cash to buy more shares of your best stocks at a proper strategic point.

Its always wise to only make new stock purchases or add shares to winning stocks when the general market direction is in a confirmed uptrend. This is because approximately 75% of all stocks follow the current general market direction.

Big institutional stock market participants such as mutual funds, pension funds and banks like to add shares to their winning stocks when they retreat back to their 50 day moving average line. This is usually done after the stock makes a solid price advance, then retreats to the 50 day line. You can use this same strategy with your best winning stocks. Just make sure your stock bounces off the 50 day line and starts advancing again. You don't want your stock to break below the 50 day line, especially on heavy volume.

Always remember to implement good money management when trading or investing. Cut your losses short and let your profits ride. That is the golden rule of trading. I suggest to never let your stock go down more than 10% from your original buying point. If you bought a stock at 40 dollars per share, you should set a stop loss at 36 dollars to protect your trading capital. You can always move the stop higher as the price of your stock advances.

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Should You Create A Mock Portfolio?

There are a number of reasons why one should create a mock stock portfolio. Here are my top 3:

#1: FIND OUT HOW GOOD YOU REALLY ARE

Of course we're all good at picking stocks - we're intelligent and have a unique perspective that leads to the way we picking stocks. But is there an objective, scientific way of knowing that you'll make more money investing in stocks yourself, rather than investing in mutual funds or ETF? People may point to research that shows that ETFs and mutual funds perform better than the average investor. But am I really just an average investor? What if Warren Buffet fell for that line without trying?

Mock stock portfolios are one of the better ways to find out. You don't risk any real money and can still find out how good you are. Create one and measure yourself against some of the alternatives like an index fund or a few mutual funds. Don't measure yourself against stock investment newsletters that report their own performance - you can never be sure how accurate their numbers are.

#2: LEARN FROM YOUR MISTAKES

Having a mock stock portfolio, lets you learn from your mistakes without actually losing any money. You'll learn if you buy too early or too late, sell winners before you should or hold onto losers for too long. You'll know if you tend to focus too much on a few sectors, making your portfolio volatile. If someone offers you a free no risk trial period with your portfolio, wouldn't you accept it? A mock portfolio is quite the same. Even though you're giving up potential real profit, it's worth the effort.

#3: TEST DIFFERENT STRATEGIES

Maybe you have different theories on what will make the most money. Should you pick growth stocks or rely on dividends? Follow the Dogs of the Dow or the Alphabet Portfolio? Each strategy has different ways of being implemented. You could rebalance the Dogs of the Dow every year so that all positions are equal, or you could choose not to. You could choose stocks that have a good dividend yield either because they increase how much they pay or because their stock price fell. Using mock portfolios will help you see how you perform with each strategy.

There are a number of websites where you can create mock portfolios. Make sure to choose one where you can place orders just like you would at a real stock brokerage. This lets you try out market and limit orders and allows you to test your money management skills. is a great place to create to create a mock portfolio. In addition to 3 benefits above, you also get to showcase your abilities and maybe even make some more money.

Here's to better investing!

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Do You Understand The Unknown Facts About Trading For A Living

If you are one of those people that do not normally trade to make a living then the first question you will put to someone that does is how they succeed in trading for a living. Of course, others might argue the fact that what constitutes a living for one person may not be the same for another person. For example, for many of us making a living would mean earning fifty thousand dollars a year while for others it could mean earning ten times that amount.

So, before you get an answer to the question as to how you can succeed in trading for a living it is necessary to identify the amount of money you have available and also how much you wish to earn. What's more, there are some traders that are ready to risk all of their money to earn the same amount while other people would risk less money and expect to earn less.

When it comes to understanding how to trade to make a living you need to also understand that sometimes you might lose money and other times you will make money. Even the most experienced traders lose money; so, it would be wrong to expect that you will always succeed in making profits year in and year out.

The real crux of the matter is that you need to identify what making a living means to you and also whether you have a system that you can put to use in order to achieve your goals. Provided you act with discipline and remain committed and you persevere there is no reason why you cannot learn to make a decent amount of money out of trading.

The trouble is that most people do not have the required discipline to remain focused on their objective for a time span of five or ten or even twenty years and so will give up if things do not work out right for them. To succeed you need to behave like a person trying to win an Olympic gold medal or become a world renowned surgeon or even a Kirov ballerina.

Even if you do behave like a would-be Olympic champion there is still no guarantee that you will succeed because even a single mistake at any time can put paid to all your efforts and causes a huge loss of money to you.

There are fortunately a few systems that have been developed by people that have indeed succeeded in earning a good amount of money from trading. If you spend a little money you can make use of such solutions that help you understand market forces (to a certain degree) and in this way you can learn how to make a profitable deal.

Most people that have succeeded in trading for a living have realized that they do not need to monitor the market on an hourly basis. What is required is managing their trades for between ten to sixty minutes on a daily basis. But remember what an old adage says and that is that you may be able to do anything in your life; just don't attempt to do everything because that is a surefire means of inviting failure instead of success.

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Screen Of The Week: A Relative Price Strength Screen For All Markets

Over the last few weeks, I've found myself screening for stocks with the best Relative Price Changes in an effort to determine whether a stock is good or not. Of course earnings growth and valuations are important. But if a stock is simply not responding, or even going down (worse than the market), something's wrong. Or at the very least, it's simply not ready to move higher. I've talked about this kind of stuff in the past ? what investors consider to be their best stocks -- and the answer is that the best stocks are the ones performing the best, in other words, moving higher. And it's the same here.

Stocks moving higher have a tendency of moving even higher. And the stocks I've been looking at recently are indeed the ones moving higher; especially on good volume, since the overall market volume has been kind of weak. And if they are moving higher, there's likely a good reason or else they probably wouldn't be. Of course, this doesn't mean you should only look at its price change. But by including those kinds of things in your screening, some very interesting stocks will come up.

Some might've just missed your normal fundamental screening. But when put on your radar screen thru other measures (its price performance for example), you might find that these are just the kinds of companies you've been looking for.

Once again, you'll also notice that I said relative price strength. There are, of course, periods where virtually everything is going down. So screening for absolute positive price changes will often times come up with zero results in these periods, just when you need them the most. But also, when the market is doing nothing but going up, you want to get into the pacesetters and outperformers, not the laggards that are going up only because the rising tide is raising all the ships. So using the relative price strength will always put the outperformers on your list in both good times and bad.

In this week's screen, I'm looking for relative price change winners that also have the fundamentals to potentially make these gains lasting.

The screen starts off with: * Relative % Price change ? 12 weeks > 0 * Relative % Price change ? 4 weeks > 0 * Relative % Price change ? 1 week > 0 (I'm looking for stocks that are outperforming the S&P 500 over the last 12 weeks, 4 weeks and 1 week.) * Projected Growth Rate (F1/F0) > the S&P 500's Median Growth Rate (Not only do I want the price to be responding better than the market, I also want the growth rate to be better than the market.) * Zacks Rank = 1 (Only Zacks Strong Buys) * Current Price >= 5 (They all have to be trading at a minimum of $5 or higher.) * Average 20-Day Volume >= 100,000 shares (And have enough volume to allow easy trading in and out.)

Here are 5 stocks that made it thru this week's screen (for 2/9/10):
ACF - AmeriCredit Corp.
CBT - Cabot Corp.
MKSI - MKS Instruments, Inc.
STX - Seagate Technology
UTI - Universal Technical Institute, Inc.

These are all strong stocks fundamentally, and they are on the move and outperforming the market.
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.

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Key Levels For The Major Indices

Much has been made about the Dow Jones Industrial Average (DJIA) touching the key 7,500 level this week. Why is this level considered important from a historical and technical basis? And what are the other major indices, such as the S&P 500 Index (SPX), NASDAQ 100 Index (NDX), and NASDAQ Composite Index (COMP) showing on a long-term basis?

As you can see in the following chart, this area on DJIA marks the previous lows from November 2008 and 2002-2003 and was also an important technical level in 1997-1998, so it can be considered a strong support level. As you can see the following chart, if we do break sharply below 7,500, we are basically going back to mid-1990s levels in the Index.

The S&P 500 Index (SPX) has breached the 800 level which was significant in the past, but the 750 area is perhaps more important, and we have not yet touched that level this month. We are currently about 5% above that level.

The NASDAQ 100 Index tracks the performance of the biggest NASDAQ stocks -- this Index almost touched the key 1000 level in November 2008, but currently is about 15% above that level, due to the recent general outperformance of NASDAQ stocks. Some of this is due to the lack of Financial and Energy weighting in NASDAQ Indices.

The NASDAQ Composite encompasses almost 3,000 NASDAQ listed stocks. The COMP is the Index that famously hit 5,000 in March 2000 at the height of the parabolic uptrend now known as the "Internet Bubble". This Index bottomed around 1,100 in 2002/2003, and thus far we have remained above that level, both currently and in the November 2008 plunge. We currently stand about 25% above 1,100 on the COMP.

The bottom line is that we are dangerously close to making 12 year+ lows on two of the most widely followed indices, the DJIA and the SPX. However, we do we established support around and just below the current levels which one would anticipate is likely to hold (at least for a trading range consolidation). The NASDAQ indices have withstood the 2008/2009 drop much better ... but from the bearish perspective, they indicate a potential 15% to 25% more downside to their key levels. Of course, these are very long-term charts -- within the big picture multi-year trends are many short-term great trading opportunities on both sides of the market for option traders.

Moby Waller,
BigTrends Portfolio Manager & Analyst

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It Will Get Worse Before It Gets Better

The depth and length of the global recession now underway will be the key determinant of how shares and other financial assets perform this year.

Compared to the 1930s, the global policy response this time around has been far more positive and far quicker, so a re-run of the Great Depression is very unlikely.

AMP Global Investors' chief economist, Dr Shane Oliver says its early days and the financial crisis is continuing but some key signposts to global economic recovery are showing tentative signs of improvement.

-------------------------

It is obvious the global economic situation is bleak.

The key problem last year was the financial crisis. Given ongoing bank problems this is clearly still with us, but this year the key problem will be the economic fall out.

The US, Europe and Japan are now contracting in a synchronised fashion and this, along with a gathering slump in the emerging world, is likely to make it the worst global recession in the post war period.

The Australian economy is also being hard hit and looks destined for recession.

The OECD's leading indicator is plunging at its fastest rate ever.

Talk of not just recession but depression has become common place as evident in the next chart.

The key to when shares and other growth oriented financial assets get back on to a sustainable rising trend will be the depth and duration of the global recession and a big driver of this will be the global policy response.

The Policy Response

The financial crisis and the synchronised global economic slump that is still unfolding is unprecedented.

But so too has been the policy response by governments all around the world. This has focused on:

? A rapid reduction in interest rates with rates falling to near zero in the US and Japan, to record lows in the UK and falling sharply in other countries including Australia.

? Fiscal stimulus including spending increases and tax cuts with a massive mix of tax cuts and extra spending soon to be announced in the US.

? Unprecedented measures to stabilise the financial system. These vary by country but include providing loans to financial institutions, providing funds for credit markets and buying private sector securities such as mortgage backed securities, injecting capital into banks, insuring some banks against additional losses on their bad debts, the provision of guarantees over bank borrowing and, in some countries, bank lending.

More measures are on the way with the US now looking into a comprehensive way to remove toxic debt from banks? balance sheets.

The question is will it work? This raises several issues.

Very different to the 1930s

One criticism of the policy response to date has been that it has been too slow and inconsistent. Interest rates weren?t cut quickly enough and the US response has seemed haphazard at times.

However, these problems partly reflected a combination of uncertainty about the size of the problem and the Bush Administration's ideological bias against intervening in free markets.

The latter problem is likely to be removed by the more pragmatic Obama Administration.

But the policy response in the last year has been far more positive than was the case in the early 1930s as the Great Depression unfolded when:

? US interest rates were in fact initially raised and only started to fall aggressively in 1933 and never reached zero despite consumer price deflation.

This time around US interest rates have reached zero in just over 12 months after the share market peak.

? Fiscal policy was initially tightened in the early 1930s in the US reflecting an obsession with balancing the budget and there were no ?automatic stabilisers? such as unemployment insurance.

Even when the New Deal arrived after Franklin D. Roosevelt became president in 1933 fiscal stimulus was modest amounting to just 1% of annual GDP compared to what is now being proposed by President Obama with over $US800bn spread over two years equating to 2.7% of annual GDP.

? In the 1930s over 5000 US banks went bust taking their depositors? savings with them as there was no deposit insurance or government guarantees over bank borrowing.

This led to a massive collapse in the US money supply and was a major contributor to the severity of the Depression.

Now having learned the lessons of the Depression governments have been bending over backwards to prevent losses to depositors and to prevent an implosion in the financial system.

Won?t the monetary expansion just create inflation?

Some fear that by pumping cash into the financial system central banks will simply create inflation. This is unlikely.

Narrow money supply measures have increased largely reflecting increased bank reserves.
But to get inflation we need the banks to lend more, so that broader credit measures increase and we need people to start spending in excess of the economies? capacity to produce.

So far, while the increase in reserves has boosted narrow money measures, banks are leaving them on deposit at the Fed, broader money supply measures have picked up but not by much, credit growth is still negative, and spending in the economy is contracting such that excess capacity is rising.

Until demand picks up there is no reason to worry about inflation. In fact the big concern is more likely to be deflation.

When demand does pick up then the Fed and other central banks will need to reverse their policy stimulus, but they seem well aware of this.

Will the deficit financing just push up bond yields?

Every time there is a recession and public sector budgets shift into large deficits as is occurring now there is concern that it will boost inflation and that the increased supply of bonds will boost bond yields. Both fears are misplaced.

Expanding budget deficits don?t cause inflation or higher bond yields in economic downturns because they are offsetting an increase in private savings as private consumption and investment are slashed.

The Japanese experience in the 1990s was a classic example of this ? the budget deficit and public debt blew out but inflation turned into deflation and bond yields fell below 2%.

Why not let market forces just run their course?

A more fundamental criticism from free market ideologues is that market forces should be left to run their course so as to cleanse the system of past excesses.

In other words, after the good times of the boom we now all need to suffer!

This was the approach to economic management prior to World War Two and it resulted in regular wild swings in economic activity and unemployment.

The trouble with this approach is that it can cause massive economic pain.

Sure, the 1930s depression unwound the excesses of the 1920s but this came at a big cost to society and much of the pain was borne by innocent people ? ordinary workers who lost their livelihoods as unemployment rose above 20% and ordinary people who lost all their savings in bank failures.

It also runs the risk that the people on the receiving end of the pain will decide that capitalism is not for them possibly leading to more extremist fascist or socialist governments.

As such a 'do nothing? approach is not politically acceptable to most governments.

Are there any signs it is working?

Given the ongoing losses in global banks and the latest slide in bank shares it is clear that the financial crisis is still with us.
However, were it not for the capital injections into banks and guarantees over bank borrowing, the situation today would likely be far worse.

More fundamentally though there have been some signs of improvement. Focusing mainly on the US situation, which is the key in all this:

? The gap between interbank lending rates and government short term borrowing rates has fallen sharply from levels in October.

The gap between corporate borrowing rates and long term bond yields has also fallen, albeit only tentatively. See chart below.

Mortgage rates in the US have fallen over the last two months from around 6.5% to around 5%.

This in turn has seen a huge increase in US homeowners refinancing their mortgages to lower fixed rates, which is normally a precursor to stronger consumer spending.

? Consumer confidence measures are showing tentative signs of stabilising in the US and in Australia.

? Chinese money and credit growth have recently started to pick up again.

? There are some signs of stabilisation in global trade, as indicated by the Baltic Dry Freight index (a measure of shipping costs) which has stabilised after a 90% fall.

To be confident that economic recovery is definitely on the way a range of other signposts need to turn positive including: a slowing in the pace of US house price declines, an easing in bank lending standards and an improvement in credit growth.

However, the fact that some indicators have turned a bit more positive is a good sign and consistent with our expectations for a global economic recovery from later this year and/or through 2010.

Conclusion

The global policy response is absolutely necessary in providing a counterweight to the global financial crisis.
More action is needed in the way of fiscal stimulus and measures to get banks lending again and this looks to be on the way.

The economic news will likely get worse before it gets better and this will ensure a volatile ride for investors in the short term.

But there are signs that the policy response is helping. And this provides some confidence that growth will start to stabilise/improve later this year and through 2010, which would be consistent with shares getting back onto a sustainable recovery path this year.

IMPORTANT: AIR reports about financial markets and investment products in the widest sense possible. The AIR website and all its contents is prepared for general information only, and as such, the specific needs, investment objectives or financial situation of any particular user have not been taken into consideration. Individuals should therefore talk with their financial planner or advisor before making any investment decisions.

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Job Losses Tell Us It?s Going To Get Worse

There is one overriding message from the jobs bloodbath of this week.

That is: this slowdown is going to be long, hard and tough and things are going to worsen.

Indeed US brokers Merrill Lynch now says it thinks estimates for 2009 profits for US companies are still too generous, that earnings are going to be lower.

Brokers already believe that December 2008 quarter earnings will be down 28%, so Merrill Lynch's warning should be seen as a pointer to the future.

Anyone thinking it's going to be a quick exit/rebound later this year, or even in 2010, had better think again.

The 100,000 job cuts that echoed around the world on Monday came from retailing, cars, heavy manufacturing, light manufacturing, technology, finance, insurance, technology and more.

On top of the cuts from the likes of BHP Billiton the week before, Intel and Microsoft, the trail of losses is mounting rapidly, day by day as employers, who have tried to keep staff on for as long as possible, are forced by plunging profits, to chop and chop deeply.

Companies reported badly damaged 4th quarter earnings in the US and Europe and used these profit slumps as the basis for the jobs cuts: Texas Instruments, Caterpillar and ING for example (it was bailed out by the Dutch government for a second time with a deal to takeover dodgy real estate assets and keep lending to the economy).

The IMF saw the US economy contracting 1.6% this year, with the euro zone shrinking 2% and Japan 2.6%. Media reports said the Fund, later this week, would reveal world growth for this year 0.5% at best. Next year an optimistic 3%.

Overnight the Japanese economy okayed a modest stimulus package of about $US75 billion and the German Cabinet signed off on a 50 billion euro package. The UK Government revealed a $US4 billion-plus assistance package for its car industry.

The aim of these packages is to try and slow the downturn and keep as many people as possible in jobs.

Companies in the US and Europe chopped more than 90,000 jobs Monday that also saw the Iceland government collapse, General Motors chop more factories as sales slump, and America's second biggest cardboard processor collapse with $US5.6 billion in debts.

Around 80 000 jobs were cut in the US, the rest in Europe.

A survey of private sector economists in the US had bad news: they see the slump as worsening. (Source)

The survey found that companies will lay off more workers and hoard more cash in the next 12 months. A large majority of the 105 economists polled believe the country's gross domestic product will continue to sink in 2009.

Respondents to the survey were getting more pessimistic about the macroeconomic outlook. "78% of respondents expect U.S. real GDP to be lower in 2009 than in 2008."

"NABE's January 2009 Industry Survey depicts the worst business conditions since the survey began in 1982, confirming that the U.S. recession deepened in the fourth quarter of 2008," said Sara Johnson, a NABE economist.

Nearly half (47%) of surveyed economists said overall industry demand was falling, compared with 35% who said so in the October survey.

"Just 10% of respondents said profit margins were rising, compared with 52% who believe they are falling. And 38% of economists said capital expenses are falling, up from just 15% in October.

"Over half expect real GDP to fall by more than one percent this year, and only three percent project growth of over one percent.

"Falling profit margins outnumbered rising margins five-to-one among respondents? firms?the worst reading since 1982.

"Job losses accelerated in the fourth quarter, and the employment outlook for the next six months has weakened further.

"With market prospects deteriorating, firms slammed the brakes on capital spending in the fourth quarter of 2008; the percentage of firms reducing capital expenditures (38%) was the highest in the history of the survey."

The survey found that a majority of those replying said credit conditions hurt businesses, as customers had less leverage to buy discretionary products. 78% of respondents said tightening credit conditions affected customers, and 52% said the credit crunch directly hurt businesses in their industries.

Rapidly deteriorating global market conditions are hammering business profits.

"For the fourth consecutive quarter, reports of falling profit margins (52% of respondents) outnumbered reports of rising margins (10%). This was the worst result since the spring of 1982.

Job losses accelerated in the fourth quarter, producing the worst survey result in 17 years. Some 44% of firms cut payrolls, while only 14% added workers.
"Looking ahead, 39% of companies plan to reduce payrolls over the next six months, while 17% plan to increase employment. Only the services sector continues to create jobs."

If anything, that explains why so many big and small companies are now cutting jobs, more than a year after the US economy officially slipped into this recession. Business conditions have become so fraught, thanks to the credit crunch and drought, that they have no alternative.

With US first time jobless claims running at more than half a million a week for the past two months, there's no let up in the flow of bad news for US workers, and increasingly employees in Europe and Japan.

US unemployment looks certain to surge from the December level of 7.2%, even as thousands of workers stop actively searching for the few jobs that are there.

But there was some rare good news from the battered US housing sector with the National Association of Realtors reporting a 6.5% rise in the number of pre-owned houses sold in December: 4.74 million unit annual rate. Economists had expected a 4.40 million unit pace.

The US Conference Board said its index of leading economic indicators rose 0.3%: economists had expected a fall of the same size.

However, the realtors' report also had the now familiar bad news with the median national home price in the US down 15.3% in December from the same month of 2007, the largest fall on record.

The financial crisis claimed Iceland's Prime Minister Geir Haarde who announced the resignation of his government after months of protests over economic policies that brought the country close to Bankruptcy.

A coalition of Green and leftwing parties is expected to win the election later this year, which could provoke tensions between the country, the banks and the IMF. The Social Democrats will form a new Government in the meantime.

But Canada will spend $US5.7 billion on infrastructure over the next two years and officials said Canada will run budget deficits totalling $US53 billion over the next two years.

And the Norwegian government presented a $US2.87 billion fiscal stimulus package to prevent a surge in unemployment. It is dipping into its state-owned wealth fund to help bolster spending, as is Singapore.

But it was the toll of job losses that staggered observers: construction equipment giant Caterpillar axed 20,000 places worldwide to cope with plunging sales. Its big Japanese rival, Komatsu warned of a 15% drop in sales and a 42% plunge in profit in the year to March 31.

New York-based drug maker Pfizer announced it would acquire its rival Wyeth for $US68 billion ($A104 billion), and then announced it would chop the combined workforces of the two companies by 19,000, or 15%, and its own global workforce by 10%, or 8,000 jobs. It's halving dividend to help finance this big deal. Investment banks will carve up $US207 million from this mega-merger.

Texas Instruments reported a big fall in 4th quarter profits, and plans to shed up to 3,400 jobs. And still in technology, an American union reckons IBM, which last week reported better than expected 4th quarter profits, is readying itself to chop at least 2500 jobs soon. .

General Motors dropped an extra 2000 jobs at two US plants as it continues restructuring. US telecom operator Sprint Nextel said it would cut 8000 jobs, or 14% of its staff, and top US home improvement retailer Home Depot is culling 7000 employees across America.

The big Dutch financial services group, ING, has obtained more help from its government to stay alive and is sacking thousands of people, as is the huge Philips lighting and technology group.

All up, ING and Philips are shedding around 13,000 people from their businesses worldwide to try and cut costs as sales and demand slump faster than expected.

And Corus, the big Anglo-Dutch steelmaker is cutting 3,500 jobs around the world, some 2,000 of them in Britain, due to a sharp fall in demand for steel.

The company is Europe's second-largest steelmaker now owned by the Indian company, Tata which is struggling to keep Jaguar Landrover alive in Britain..

Another major US company has collapsed: the Smufit-Stone Container Corp, a cardboard packaging giant and one of the world?s largest paper recyclers, has gone bust in the US with $US5.6 billion in debt. It was unable to service amid a slumping economy and demand for its products.

The company, which is based in the US but was founded in Ireland, filed for Chapter 11 protection in the US: besides the $US5.6 billion in debt the company had $US7.5 billion in assets. 24 subsidiaries or affiliates also sought protection. It had net sales of $US7.4 billion in 2007.(Source)

Smurfit-Stone, based in Chicago is North America?s second- largest maker of corrugated packaging, and has 22,000 employees in the US, Canada, Mexico and Asia.

In Britain two retail chains selling shoes went bust overnight and their listed owner, Stylo, was suspended from trading.

Barratts Shoes and PriceLess became the latest British chains to go into administration, putting the jobs of around 5,00 people at risk. The 400 stores in the two chains will remain open for now.

They join fashion chains, Dolcis, Stead & Simpson and Faith which have all gone into administration. Woolworths has closed, at a loss of 30,000 jobs and the home improvement group, MFI has failed. The UK children's retailer, Adams has shut, while furniture retailer, Land of Leather is a failure.

And a sure sign of the damage the credit crunch is doing to business can be seen from the 72% plunge in 4th quarter operating earnings for American Express.

The credit card giant said quarterly profit from continuing operations hit $US238 million, down from $US858 million in the same quarter of 2007 (Source).

American Express received a $US3.4 billion from the US Treasury's bank bailout fund earlier this month as surging consumer defaults forced it to set aside more reserves and the market for bonds backed by credit-card debt froze.

The company has chopped 7,000 jobs, frozen management salaries and cut other costs to try and save $US1.8 billion a year. For the year earnings fell 32% to $US2.8 billion.

IMPORTANT: AIR reports about financial markets and investment products in the widest sense possible. The AIR website and all its contents is prepared for general information only, and as such, the specific needs, investment objectives or financial situation of any particular user have not been taken into consideration. Individuals should therefore talk with their financial planner or advisor before making any investment decisions.

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