General Motors ( GM ) 10/9/08 Dow Jones

General Motors was downgraded to credit watch negative.....plunging ( GM ) shares 30% to close around $4.90 per share.

The Dow Jones Average crashed 678 points today to 8579. So what is the problem? Tons of sellers, and very little buyers. Many big funds are stuck in stocks at significantly higher prices and have been forced to sell....or when we do get a big of a rally, they sell. Today's plunge took about 45 minutes.

A sign that this would happen: Many of the European Banks sold hard into the close earlier today in the Europe markets so that gave me a hint to this happening.

We are due for a major rally off the lows.....1000 - 1500 points but where those lows will be is a good question!

I'd like to see capitulation tomorrow morning so we can finally put in a bottom. I'd like to see a major gap down..... maybe hit 8,000 on the Dow and then a stampede of buying with heavy volume. The problem is we always get these big down days and rally right after them. At this point, we need everyone to puke up stocks and that will attractive big buyers. The sooner we get this over with, the sooner we will move higher!

The Asian markets will crash tonight....you will see losses you never would have thought possible. In Asia tonight, it is Friday over there.....last day of trading for the week. They have no idea how we will trade tomorrow so it will be worse for them!

My Stock Shopping List: GOOG, AAPL, FCX, ENER, V, MA....these are the stocks I am looking at buying on the cheap.

Bidu - Baidu.com : I bought BIDU and GOOG 8/20

Yesterday I made some purchases......BIDU at $304 and GOOG at $490.......I took profits in the past two day in XTO, CHK, CLR. They will most likely continue going up with Oil but I wanted to regroup and take profits. If they dip at all, I will be back in!

I bought BIDU because the company is growing very fast and it continues to blowout quarterly earnings. Baidu revealed they are taking even more market share from competitors in China. Baidu.com only trades at 45 times 2009 earnings which is cheap compared to how fast it is growing. If you missed the Google ( GOOG ) IPO, here is your chance!

I bought GOOG because this is the time of the year you want to be in the stock. You accumulate in the summer sell in December. Google under $500 has always been a steal!

Keep in mind, I have taken half positions on both....if we get dips, I will continue to add.

These are my two stocks for the rest of the year....the Garmin had to go the second they said Nuvifone was delayed. I will look at Garmin ( GRMN ) again in the future.

Google ( GOOG ) Why I bought Google - Should you Buy GOOG?

I have been buying Google over the past few weeks here....accumulating a position while I can still buy it under $500. I think once the technology sector turns ( and it could be soon ) higher this could be the last time you will ever see Google below $500 again.

Why?

Well first things first, the Gphone Anroid platform will be coming out this fall...that should be a plus.

Second, 2nd quarter earnings for Google are usually slow.....this 3rd quarter I think will be a blowout. Remember Q1 earnings? GOOG reported a blowout quarter...the stock went from $460 to $600....they miss in Q2 slightly and its all the way back to where it started? Are you kidding?

Third, YouTube is starting to make money.....when they get that together...lookout! We will eventually have a YouTube cable channel with ads flashing silently on your TV screen. Oh, did we forget about Doubleclick already? This is a huge growth opportunity.

Google will continue to growth each and every year. Google is expected to earn $19.69 per share this year...I think it will be over $20. For 2009, Google is expected to earn $24.50.

With 13 billion in the bank, and sporting a PEG ratio of .82 ( Yahoo has a PEG of 2.44...how crazy is that! ) I think Google is very cheap here. To me the Google's downside is very limited!