Monday, September 08, 2008

Is Anyone Suprised?

"All your GSE are Belong to Us!"

Good grief.

The only thing more disturbing than the corruption is apathy I guess. Fannie and Freddie were declared solvent and strong enough to stand on their own what -- two months ago??

Interestingly, the Russians who wrote about the collapse of communism reported that those that did the best (mentally, emotionally) were often the most apathetic of the bunch. Those that thought they could make a difference and tried to "rally the troops" became the most despondant and had the most difficult time avoiding washin their mouths out with buckshot.

I refer to these after hours "news events" (announcements and frequent subsequent interventions) as "tape bombs" and "stick saves" -- I can't take credit for the genesis of these terms -- just parroting them here in case you haven't been exposed. The "stick saves" are coming with disturbing regularity anytime that markets approach or god-forbid pierce important technical levels on the downside. It's almost like they are trying to "manage" (manipulate! cough) the markets on the way down.

It's the reason that a huge portion of my retirement portfolio -- the portion that i'm not allowed to play futures with -- is in cash.

You see, if one only puts their money in the markets they are precluded from reacting to these "tape bombs" and "stick saves".

The futures open on Sunday night and allow you to get out of the way of oncoming locomotives whether short or the very least allow you to hedge off price movements in positions you can't unwind while the market is closed.

I've been noticing a lot of "relative strength" in financials in the last couple of weeks. Friday, to those that were watching market internals closely ( i wasn't ) it was obvious that a "fix was in"....the fannie/freddie weekend announcement was obviously known (or miraculously predicted) by some. I'm guessing the former, not the latter.

short term, this is likely to be very bullish for financials and us equities. what kind of damage this does to the country and the faith in our markets is anyone's guess. i'm rapidly rounding apathy and heading directly for "cabin in woods" territory myself.

Uruguay Guy

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