Betting on the Break

I went out on a limb and made two trades at the close today.

The Brazil index (EWZ) I shorted at $37.00
I shorted the Canadian index (EWC) at $37.43

I am betting on the deleveraging continuing. I picked one most likely to break (Brazil) and the one hit less than most (Canada).

One of my online sources was saying that an inside source at a Canadian fund of hedge funds needs to liquidate $7 billion. And that's just losses from the last week, not including this week. We've gotten to the point where the more it falls, the more it falls. If there's a huge rally, I'll sell off a holding or two.

I expect more currencies than Iceland and Russia to break. What they will learn is that their stash of Treasuries is worthless when they try to get real dollars for them to support their currency. I need to think about this idea more, and the ramifications of it, but it's bearish for world stock markets.