"However, the Shanghai Index has been climbing since it bottomed a couple of months ago and as you all know, China is making some interesting oil deals with Russia and Brazil, etc."

"The Shanghai Index would indicate that China may well be leading us out of the recession. If that's the case, then oil should be on its way up by this summer."

So the above two paragraphs indicate what I said in my post which predicted that the Chinese economy would play a role in leading us out of the recession.

I also indicated that this was a "pure guess".

However, I am going to invite all of you to go and look at all the other stock market index graphs that you can "google" and compare them to the Shanghai Index's graph of the past 3 months.

Then you will notice some very interesting comparisons. It has been said that stock markets usually lead economies by approximately six months. So that should prove interesting in your investigations.

Next, a lot of you read various writers who do their best to predict what various economies will do in the future. More than 20 years ago, there was a study started at the University of California in which well over 200 people, that make their living at providing predictions, were studied for 10 to 15 years or so. As I remember, the conclusions were that none of them were able to predict with any certainty what was going to happen in the future and when it was going to happen.

I believe the person who did the study was named Tetlock and in short, he said that any person could randomly guess just as accurately, as any of those studied, what was going to happen in the future. Over the years, I have read a number of people who make their living predicting the economic future and I have been impressed by their writing. I believe they are usually honest and what they say makes a lot of sense when you read it. However, I would hazzard a guess that none of them predicted the crisis that we are in as well as the timing of it.

Apparently, two of the people who predicted a crisis were Robert Shiller, who is a professor at Yale, and Nouriel Roubini, a professor at the University of New York. However, their timing was out by 3 to 5 years. So again, no one predicted both the timing and the mechanics of this crisis.

So we'll go back to my original post. The Shanghai Index has been climbing since about the end of December and I hope you all take the time to study the other indexes that you may be able to "google" and you will find out that the Chinese economy as predicted by its major stock market is moving in an upward direction.

Now all that being said, remember that a stock market generally leads an economy by about 6 months, so that's why I indicated that by the summer, China's role in climbing out of this mess could well be very important.

Now let's look at one other frailty of the North American way of doing business. It's called "the Press". Before we got fully immersed in the present problems, the Press was picking up any rumours, blowing them all out of proportion, and filling their front pages to sell papers. Every day it's been going on and on. It has scared many individual investors to the point that fewer and fewer people are willing to invest their money in stocks .

If you haven't noticed, China doesn't have this problem. Their newspapers, to some extent, are probably state influenced (controlled) and quite frankly, they probably publish much less garbage than we see in North America.

So, even when you purchase food at most "check outs" you can frequently see the front pages of numerous tabloids, which are scandalous in the accuracy of their information, etc.

We live in a "so called" free society which, at times, works against our businesses being run honestly and successfully. Frequently, for example, when managements of large financial institutions misuse their power, they are not required to be accountable for their actions.

So I will stick with my prediction.

I hope that you are all having a good weekend.

Best Wishes,

Lynn