mymeohmoneyblog

I've bought some Pfizer calls just incase we get an obama rally. I've also got some Yamana gold calls just in case people decide to start buying it. The two positions might be contradictory, notwithstanding the overall deleveraging. My pfe should retain a decent amount of residual value giving me time to sell it if need be, while the auy is a bit more of a gamble, but the price looked decent.

I've spent an hour or two trying to upload Dow graphs for you, but once again i still get the Internal Error 500 Whoops! message from Movable Type. Its so frustrating and disappointing that this stuff doesn't work

We've been in a trading range with the indices. If they begin to break their lows it will begin to look increasingly like we have a chance of entering a bear market. If you break down the Dow into roughly 20-25 year periods it hasnt really fallen below its trendline unless you go back to '29. It's arguable that in this great american century we havent really had a classical bear market since the depression, notwithstanding all that stuff about arbitrary 20% falloffs, comparisons (e.g. elliot wave) to other asset values, months of descending charts, etc.

If I recall, i think it must of been about 2001/2002, i was looking at the dow chart and thinking then that about 6500-6700 would have been an appropriate and healthful pullback level. I remember feeling a bit disappointed at the time when the indices started to move back up before hitting those numbers, prematurely in my opinion. (i also remember being somewhat suprised during that general time that oil &/or defense stocks had such belated reactions to the plane hijackings that crashed into the buildings in 2001, like months and years belated). Its still a mystery to me why oil took two years to react to those events, and ive never seen if anyone else has ever tried to analyze that.

I can maintain some rather obtuse opinions from time to time. A common point i like to make is that i've never lived through a recession (see above also re: bear market theory). I'm not sure exactly what purpose is served in feeling this way, especially given by all accounts that we have had recessions, 90 (?), 00 (?),... etc. Well i do live in the midwest, perhaps coloring my views somewhat, and just recently it was reported that Iowa's unemployment rate fell to 4.2%. In my county of some 150k plus i havent heard of a single foreclosure nor layoff, everyone goes to work, goes to school, etc. As far as i can tell, the reagan revolution has been going strong for 25+ years.

Well asides from making potentially inflammatory or purposefully ignorant remarks, let me just say that i have no idea which way the market will go. However, i think the potential for an obama rally should be considered. Regardless of party affiliation the stark contrast between obama and bush speaking styles, attention to details, attention to.... anything, could have significant effects on a market seeking confidence (not bravado). Then again, the destruction of wealth may just have longer lasting effects.

On a longer time-frame dow-chart the correction to-date has negated 10-returns leading to a sideways trend analysis. Longer term trending values might still put the dow lower than where it is now, excluding paradigm shifts, productivity assesment, information premiums, regulatory structures, and other assorted valuation modifications. Were the dow to fall below trend, as it last did from 29-33, say e.g. around the 7k mark +/-, and become a bear market, and thenfall an equidistant value below trend as it had gone above trend, well, it wouldnt be pretty, (nor possible - dow minus?). ... lol??

Oh b.t.w. can anyone explain the fundametals behind the markedly increased dow-slope beginning exactly @ jan '95? Are we still undoing irrational exuberance?

What's left to be done for this market. Our 2 nearest calaysts are one last interest rate cut, and then the election. The last rally was all of 2 days. The next rally may last a little longer. Perhaps will get a minor W shaped double-rally formation before breaking the lows.

Why hasnt anyone talked at all about reimplimenting the uptick rule. Regardless of the potential veracity of the purported 'test' studies that were done on eliminating the rule, it seems the prudent and confidential thing to do would be to reverse the since-it-wasn't-broke-didn't-have-to-fix-it inauspiscious decsion made awhile back. Like no one wouldn't couldn't mind the little extra added boost of assurance these days? Just wondering. Jeez, someone cover the bases, please.

I'm not of the short-by rights camp. Of course it adds liquidity. But it is and has always been an artificial construction. One that of course needs regulation. Has anyone ever suggested a finite, maximum borrowed-short limit, say 1/3rd the shares/market-cap? First In, Last Out, Who Cares. I think maybe we could use a few thousand investigators prosecuting failures-to-deliver next year. Caveat Brokers. (and Funds...)

Hey why are individuals allowed to mark-to-model their 30 year mortgages but not banks? Seems like if we're able to budget our spending and saving according to the limits imposed upon us by our 20 and 30 year mortgages that banks should at least be allowed to mark-to-market/model (semantics) based upon something longer than the immediacy of a 3-month 10-Q. How about 30 month modeling/marking or some longer form of averaging?

The 'safest' investment these days may be in currencies, as long as you pick the right one(s) and or baskets. With everything deflating, that held in pairs can't but retain some form of absolute value. Unfortunately most no-one has currency accounts, myself included. I suppose if you live in a big city you could go to a big bank and literally buy some yen for the next couple weeks/months or even some aussie dollars for a short term bounce. I put aside a trip to uk/france this fall because of the outrageous fares, so i'm kinda looking forward to some lower fares/euros/pounds next year. Comparatively of course the dollar is the place to be, but i suspect the yen will retest and probably break last fridays 90 level, and maybe there are some good 3rd world currencies out there to sell right now (sorry). Well i'm just rambling now and not connecting the dots too well and correcting to many keyboard errors gonna sleep now nighty night. zzzzzzzzzzzzz.....

Comments: View Comments |  Tuesday October 28, 2008  |  Stocks: AUY, PFE,