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Biderman: Retail Equity Investor Is Dead

The retail equity investor is dead, said Charles Biderman of Trim Trabs Investment Research on Thursday's "Fast Money."

There have been 17 consecutive weeks of outflows from US equity mutual funds, Biderman noted. It's something he's never seen before.

"Individual investors have thrown the towel in," he said. "They're not putting money in. They haven't."

Zachary Karabell, president of River Twice Research, pointed out that there has been money flowing into foreign stocks. Biderman argued that the amount of money in foreign funds is miniscule.

Biderman said retail investor will not come back to the stock market any time soon. They lost 50 percent of their money in 2008 and since then, have only made a fraction of it back, if anything at all. With the market as choppy as it is, investors think it's too dangerous to get into equities.

Aside from uncertain market conditions, the recession has hit the retail investor hard, Biderman said. People are having a hard time paying for their offspring's college or saving for retirement. Despite some reports indicating people are saving more, he said real-time savings aren't increasing.

To play this trend, Biderman suggests getting long the SPDR Gold Shares exchange-traded fund or looking for long-term bonds.

Watch the video for Biderman's full comments.

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Trader disclosure: On Aug 26, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Cortes is long (FCX), (SFD), (BHP), (BMO), (TD); Cortes is long Crude Oil; Cortes is long Australian Dollars; Karabell owns (AAPL), (BHP), (BP), (C), (CSCO), (FCX), (GE), (GS); Finerman owns (BAC); Finerman owns (IBM); Finerman owns (JCG); Finerman owns (JPM); Finerman’s Firm owns (POT) calls; Finerman’s firm owns (WMT); Finerman's firm is short (IJR); Finerman's firm is short (MDY); Finerman's firm is short (SPY); Finerman's firm is short (IWM); Finerman’s firm owns S&P 500 puts; Finerman’s firm owns Russell 2000 puts; Jon Najarian owns (CSCO) call spreads; Jon Najarian owns (MMR) calls; Jon Najarian owns (NKE) short calls; Jon Najarian owns (SLV) short calls; Jon Najarian owns (GLD) calls; Jon Najarian owns (CME); Jon Najarian owns (CBOE)

For Zach Karabell
River Twice Capital owns (CSCO)
River Twice Capital owns (GS)
River Twice Capital owns (IBM)
River Twice Capital owns (MSFT)
River Twice Capital owns (NKE)
River Twice Capital owns (POT)

For Patty Edwards
Edwards own (AAPL) for clients
Edwards own (BAC) for clients
Edwards own (C) for clients
Edwards own (CSCO) for clients
Edwards own (FCX) for clients
Edwards own (GE) for clients
Edwards own (GLD) for clients
Edwards own (IBM) for clients
Edwards own (JCG) for clients
Edwards own (JNK) for clients
Edwards own (MSFT) for clients
Edwards own (NKE) for clients
Edwards own (TIF) for clients

For Dennis Gartman:
Funds managed by Gartman own Gold
Funds managed by Gartman own (ANDE)
Funds managed by Gartman own corn
Funds managed by Gartman own (RJA)
Funds managed by Gartman own (POT)
Funds managed by Gartman own (MOS)

Joe LaVorgna
***No Disclosures***

For Brian Nagel
Oppenheimer & Co. Inc. makes a market in the securities of PETM, SPLS, BBBY, ORLY, and TSCO.

For Charles Biderman
Funds managed by Biderman own (GLD)
Funds managed by Biderman own (AAPL)
Funds managed by Biderman own (CRM)

For Brian Stutland
***No Disclosures***

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