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Don't get crushed below NASDAQ tumble

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I think that stocks will be THE asset class to be in near the end of 2008. However, we have retraced most of the steps off the pullback since October and I think we are in for a rapid and, maybe unexpected, decline.

Therefore, I think building cash and planning for a short-term pullback is definitely appropriate. Although I know the market has kept going up since I started this call, I look at this very similarly to the way I called the ag. pullback. I think the market will go higher than these levels by the end of the year. In the meantime, I look for a sharp and painful pullback.

I might be wrong, but I will be adding to the ultrashort positions tomorrow.

We will see how all of this goes. So far, my long positions have done well and that has proped up the total account. Now I need to balance my upside further with the ultrashorts.

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