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Hello Readers,
Since the last Newsletter, we closed three positions; two for gains and one for a loss.
LEXICON PHARMACEUTICALS (9/20/08). Closed position 9/15/09 at $3.55 for a 92% GAIN.
MIND CTI (2/5/06). Closed position 9/14/09 at $1.43 for a 56% LOSS.
RETRACTABLE TECHNOLOGIES (10/20/07). Closed position 9/1/09 at $2.92 for a 56% GAIN.
Two weeks ago, Lexicon was hovering at around $1.50 and then rocketed on news that the company had successfully completed a trial in patients for its drug canidate for Type 2 Diabetes. Many times, stocks just seem to have a “sugar rush” for no apparent fundamental reasons, and that appeared to be the case with Retractable Technologies as the stock roared nearly $2 in a single day. We closed MIND CTI for a loss.
The markets should have tanked many months ago, but, as we have said periodically, stocks have soared for no reason other than the fact that the Fed has kept interest rates at zero, forcing small investors, like us, to buy way-overpriced stocks, which is really a mass suicidal bet. When this ends, and it will, it will end ugly. What will ignite the sell-off of the current “equity bubble”? Pick one of any five dozen reasons. Chances are that the trigger will be some unforeseen flaw in the financial fabric that will open up all of the other sores. But, hey, this has been a good ride for our Current Portfolio, for the most part.
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