See the animals in the stream. That's the bulls right now. They haven't been burned yet but how are they going to take this market higher with the hills around them set ablaze? They should be frightened. We all should be cautious.
Today was modestly red. Financials were weak. That may be the tell again. Yen was strong against the dollar. Mo-mo names were weak led by RIMM. The real action though was the unveiling of the big "keep 'em in their houses" campaign by Treasury secretary Hank Paulson.
1-888-Give-Me-Break
All we really needed was a hotline and a rate freeze although that part is a little vague. The idea being that if you bought a house you can't afford you just need to talk to a debt counselor. The banks are in on the plan. What's in it for them? Something I'm sure. Maybe it's just a matter of getting the message out to pay what you can rather than mailing them the keys.
Couldn't bring myself to watch the whole charade on CNBC. We got a little rally off of it but that didn't hold. Apparently, the plan is not to use taxpayer money. Yeah right.
The reality is that house prices need to come down. Period. Anything that delays or inhibits the natural clearing of the dead wood is detrimental to those who acted responsibly. Any bailout is a penalty to those who were most conservative and responsible. Just like all this rate cutting again punishes savers. You can bet the big plan benefits the big players.
I suppose there is also an element of political posturing going on here. Elected officials want to be out front of this and show their constituents they are doing something. However vain. Expect more pounding of the bailout drums.
Gold...Hmm?
Right up front. I'm concerned about a potential dollar bounce. Metals are sitting right at key levels. If they hold I may get optimistic but right now I still remain cautious. I'm concerned short term and perplexed long term. Find myself in the process of reevaluating my view based on new information. Right now I hold an insurance policy position in the trading account aside from what's in the vault. Short term I want to be long cash. As in, cash in my wallet and under my mattress. Better than keeping it in some shady bank who could potentially be insolvent.
There is more to say on this and other subjects but I'm losing all ability to function at 1:56 AM. Good. Night.
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