Time to cowboy-up, get really steely-eyed, and make some good investment decisions. Like Baron Rothschild, I think it was, said “Buy while there’s blood in the streets” and I’m smelling opportunity close at hand. No money on the table yet, but I’m ready to buy chips.
You may recall that last December around the middle of the month, I explained what my outlook was — in very general terms — for 2009. As I outlined it then, I was expecting a market low to be put in by around the beginning of March, and thereafter, we ought to see a rally to perhaps July or so, and then it would be time to ‘load the boat’ on the short side, because there would be a lot more scary times to come on this roller-coaster ride which is the financial markets.
Despite being a little late in getting here (but the markets do run on their own clock), we’re getting mightily close to the point where I’m tempted to throw in a few bucks on the long side, because despite the wealth of bad news, the market ‘feels’ to me like it could do a decent run up; something I outlined in boring detail with charts and all for Peoplenomics subscribers last weekend. So, over the next couple of days, I’ll be moving a little cash into the commodity account, where I’ve been eyeing the price action in oil and the precious metals, and then some into the stock trading account where I’ve got my eye on some interesting options. Not pulling the trigger on any of these yet, but I’m sort of wandering back to the dice table, if’n you know what I mean.
I talked briefly with Robin Landry, whose take on markets has been better than most I’ve tracked, and he’s watching the Dow 7,200 and 7,100 levels closely, along with S&P 745. He got his managed accounts out of short positions last Monday, before that 500 point mother-of-a-rally got really rolling, and he’s eyeing much the same thing. If you look over at the S&P 500 chart on Yahoo Finance, you can see that the the March 9 S&P 676 would need to be broken before a drop down to new lows could happen (technically, which is to say tea-leaf-wise).
Sure, there’s one wave count/technical perspective that says such a break could happen, but it’s feeling like something of a long-shot, despite worrisome headlines like “Big slide in global trade looms over G-20 meeting” and other “world’s gonna end’ reports. Given that the Dow has lost more than half its value since the 2007 highs, a massive rally – something toward 10,000 or beyond, is becoming due.
Not that I’m in any particular hurry for it, because while the rally’s going to be sweet – and pour a little money into my piggybank, it also means that by next November (or even mid October), people will be playing the game of financial duck & cover again, only this time, we’ll be dropping 7-thousand points from a much lower diving board, such that we could hit Dow 3,000 (or worse) in early 2010. So, if you think things have been exciting here lately, you ain’t seen nothin’ yet. But for now, I’ve got a smile on my face, and positions to consider. Not everyone lost money during the Great Depression before, and there’s no reason to do so this time, as long as the broad brush of history is kept in mind.
This morning, in a few minutes from my usual posting time) we will get the consumer confidence numbers. This is a key for the rally to ‘get legs’ because if the reading is anywhere from neutral on up, that will mean the consumer is either ready to start spending again. But, if it’s really bad, it could spin the markets back toward the downside.
Not that I care. Construction spending tomorrow, and then Thursday, and the all-important unemployment report Friday all have the potential to drive the markets lower. Which would set up my entry point next week sometime, just prior to Good Friday. Anyway, that’s my thinking for now, this isn’t investment advice, and I should consider joining Gamblers Anonymous, I suppose. Scratch tickets, one armed bandits, dice tables, or options; it’s all along the same line. But, then again, so’s banking lately…
One reason I’m holding onto gold, I mean besides the obvious inflation that will be unleashed by the maniacal spending out of Washington lately, is that as the G-20 meets in London, there’s actually discussion that Gold may come back into some kind of monetary role. Gold doesn’t have to be the only standard, but even partial convertibility would likely firm up prices. Longer term, I figure gold’s bound to double from here, and silver’s got to play catch-up along the way, too. So that’s why I am considering gold call options for my commodity account.
I assume that you’ve been watching the price of gasoline? I’m expecting that as we get closer to the summer driving season, the price of petroleum will begin to climb. It’s already moving as “Crude oil rises, set for biggest monthly increase since June” is one of the stories on Bloomberg this morning. Very short term, oil’s under $50 in some markets this morning, but that’s to be expected and a stock market low next week roughly coinciding with a small pullback in oil prices would be just fine by me.
Even though the One-Worlders may not get their global currency agenda shoved through the G-20 meeting (yet), even a modest global recovery (on happy-talk, if nothing else) has the potential to move oil back to the $80 level, or maybe higher.
The tensions in the country, if this were a sociology class, make a very interesting study. “Workers say “Obama treated autos worse than Wall Street” says an AP report.
What’s more, the government’s “Substance Abuse & Mental Health Services Administration” has opening a new website feature called “Getting through tough economic times”. Replete with\
This website is about the best indicator I can think of, when it comes to timing my return to a bullish stance. You may remember Ure Axiom 528?
“By the time government gets around to fixing something, it’s probably no longer broken…”
Just so. Call it a confirming indicator. A bounce off 7,200, or even 7,100 on the Dow next Wednesday could trigger my buying rampage.
“OECD says govt policies will avert Depression”. Yeah, yeah, sure. I’ll grant you that as the pimping of ‘good times’ here through early summer gets rolling, it may seem that way, but as the time monks note, this fall’s going to be ugly…very ugly indeed. I’ll be printing while the sun shines.
On Thursday the Financial Accounting Standards Board will decide how much lunacy is safe in the mark-to-market rules. As a story headlines here: “Mark-to-Market Lobby Buoys Bank Profits 20% as FASB May Say Yes.“
Don’tcha love it? When you start off learning accounting, it’s all this must be this way, and thus and so. And then along comes new rules which are exceptions to common sense.
Ure Axiom 76: ”If you can’t sell something, or there ain’t no buyers, it’s market value is zero.”
Too obvious? Apparently.
John Kerry is pushing for tighter gun control. And law enforcement types were telling Kerry and others holding hearings in El Paso that Mexico is not in danger of becoming a failed state.
“World’s most powerful laser has the energy of a hydrogen bomb” says a report. Use it to spice up your next boring PowerPoint…
That’s conficker not cornflaker…Email:
excellent site, try to frame my day’s news around it. ok, enough buttkissing. this is URGENT – are you aware of the ‘conficker’ worm virus currently dormant among millions of infected pc’s? perhaps you’ve mentioned this already at some point and i missed it? but somehow i feel like you might not be aware of it, given that it is set to ‘go live’ on april 1st, 2009 – i.e. TOMORROW – and i would imagine you would be all over it in the blog with increasing attention as it approaches the zero-hour, were it on your radar. i dont know. anyways, there’s a pretty disconcerting nytimes article on it that should come up close to the top if you google it. apparently the code is incredibly sophisticated and the authorities have been trying to trace its source since at least october with absolutely no luck. also, they have no idea what it will do once it wakes up. im wondering if you or cliff have made any correlation to this with some of the linguistic hits on the old php-flux-capacitor or not? if nothing else, i think it might well behoove us all for you to put out the alert to any potentially infected pc’ers to maybe unplug their computers before midnight tonight (3/31/09) and leave them off for the entirety of the day tomorrow? or is that even just wishful thinking to assume that would work? either way, all i know is it’s times like these im soooo glad im a mac.
keep it up, man….”
One More Fear
North Korea may have two nukes. Two more than Iran? I wonder….