All the news is so bad

Fund performance: -7.316%
Closed trades: Kospi March future at 148.95. This was a blow - our stop was at 153.00 and we were not expecting over 2.5% slippage but I guess this is always the risk with emerging markets. We're glad we tightened our stop though as it continued much lower.
Dow March future closed at 7979. This was another horrible blow as this was pretty much the exact low - and it was our largest equity position. It's now trading at 8244 and this would have equated to a fund difference of over 3%.
Active trades: Short EURAUD to March IMM; MtM +0.186%. Long FTSE March future; MtM +0.056%. Long SPX March future; MtM +0.276%

Another week of high volatility and terrible news. Banks were getting attacked in every country towards the end of the week. Anglo Irish Bank was nationalised in Ireland. The head of Deutsche collapsed after they announced worse than expected results. Citibank and Bank of America announced worse than expected results as well. There were rumours that Citibank (once the world's largest bank) was to be nationalised this weekend. Trading in Barclay's bank was suspended twice on Friday due to vol breaks as it collapsed so fast. Ending the day down around 30%.

ECB did as expected on Thursday with a 50bps cut. And we did end the day much higher in equities as we expected. But then we dipped right back down, and then higher again, and then right back down and then much higher again (around 6%) before dipping again, before ending Friday evening strongly enough! Crazy volatility for small enough net moves - impossible to hold a position and risk-reward to trading remains low. That said, despite all the horrible news, we take hope from Friday's strong close and are happy to be long equities even if we are gutted at not being longer after being taken out at the lows of the Dow index. In contrast, our stop in the SPX was perfect. We will point to the long-legged doji (a technical candlestick chart formation) formed on Thursday in US equity futures. This is a very bullish signal if confirmed over subsequent days trading. It was not de-confirmed on Friday but we are not yet confident enough to add to our equity positions considering the fund is down money and we are only marginally onside on our current positions. We prefer to add from a position of strength if possible.

What was very interesting is how JPY strength ended on Thursday exactly as expected. We should have listened to ourselves and waited to buy crossJPY on Thursday rather than getting stopped out of our positions from entering too early. However, we will look to re-enter GBPJPY longs on the open on Sunday evening with stops below the all-time lows (now at 128.85).

Monday is a US holiday so there will be reduced liquidity but we are expecting that by Tuesday evening our bullish equity stance will be confirmed and we will probably add to our longs by then - preferablly from a position of greater strength than we are now in. We are becoming more certain that the US will succeed in saving the financial world; the markets will soon start thinking this and becoming more risk-positive; and it will be several months before we start focussing on the much longer-term negative economic consequences for the world and the US in particular. At the moment, US equities are still probably the best bet, but we think in six months time, they may not be a good buy in real terms for many years to come. Can we reiterate that despite our current opportunistic attempt to be bullish, there is no way that the US can come out of this strongly over a longer-term horizon. This current crisis is the beginning of the end for American domination of the world economy and fifty years hence - that will be obvious to Harry Hindsight.

Good luck!