Michael Shulman

The Best Stock For 2009

by Michael Shulman   01/08/09

Everyone wants to know what the great stock for 2009 will be. And I can tell you.

Well, it's actually not a stock -- it's an ETF.

So, what does this exchange-traded fund track?

Gold? No. Oil? No. The Nasdaq and tech? No.

It tracks the financials -- to the downside. The UltraShort Financials ProShares (SKF) mirrors the movement of the Dow Jones Financial Index in inverse -- actually, double the inverse. When the Dow Jones Financial Index goes down 1%, this ETF goes up 2%.

This is a high-risk, high-reward play that is extremely volatile. The SKF's trading range in 2008 was $87 to $304.

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Let Michael Shulman help you make money on the short side of the stock market, while profiting from the economic crisis of 2009 with his free report.

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You've been warned about the risk here, but I urge you to keep reading. Even if you decide that SKF is too volatile for you, I want to make the case for why you need to avoid the banks in 2009.

No Quick Fixes

Some people believe that the current problems with the big banks are over thanks to the huge injections of capital (i.e., taxpayer money) by Bernanke and Paulson. It's enough, right?

Wrong. Take a look at Citigroup's (C) off-balance sheet assets (the debt it holds). That number starts with a "T," not an "M" or a "B."

The bank write-offs are over or, at least, we know how much they are going to be, right?

Wrong. Ever hear of option adjustable-rate mortgages (ARMs)? These mortgages are funkier than subprime, if you can believe it, and we're talking about $150 billion or so.

Plus, $530 billion in commercial property loans comes due in the next three years, and there is no money to roll them over. Oh, and credit card debt is no longer being securitized, as no one will buy the bonds.

But, wait -- the Fed is buying this stuff, right?