Friday, March 02, 2007

"Oh, the Humanity!"

Well, anyone who wasn't long the equity markets(or the precious metals!) this week, was probably enjoying a healthy dose of shadenfraude.

To anyone who was wiley enough to be SHORT these markets is probably laughing all the way to the bank.

Unfortunately, although fuBarrio has been calling for a collapse for the better part of a year, my net position was long (mostly in little mining stocks) and I ended up losing a little bit of money. Luckily it wasn't anything that I couldn't weather and only one uncontrollable twinkie binge was bad enough to actually justify the police coming out to talk me off the ledge.
As I said last week, before the carnage (ok, it really wasn't *that* bad) I really think this is the beginning of something much more sinister than a 3% down move. Unlike some others, I see no real reason for optimism in the stock market in general. Unfortunately, since I really don't trust the federal reserve to do what's best for us (the general public) I don't really feel that comfortable hiding in cash either.
So, here I am, like everyone else, trying to duck and weave in and run out from under the burning wreckage.
Before Tuesday, the volatility index was at absurd lows....meaning that no one was really taking the possibility of a big drawn down in values seriously. Now, they are not so complacent, surely. Who's holding the US mortgage bag? What will they do when they realize it? What will the Fed's reaction be? The BOJ? The Chinese?
Unfortunately, way more questions than a balding dog can possibly have the answers to. Tune in next week as we try to discern from the market activity (after a good weekend of cooling heads) what the longer term trend will be.
I'm guessing safer investments might look a little more attractive. We'll see.
ciao for now,

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