A Bitter Pill
This week has been a bitter pill to take. In 2002 I decided to put together an investing/trading approach that would key on Political/Economic situations and have technical backup. That led to five years of being primarily long the Gold market because of the destabilizing effects of Iraq and a couple of years being primarily short the stock market for all the reasons I have discussed on this site day after day. In my view the current stock market, especially this week, is a final verdict on 28 years of the wrong economic approach.
It hurts a lot, both monetarily and philosophically, that we were not short for the final clean-out of this mess, and even worse that I did not over-ride some long-term timing models that have been under-performing since mid-August. While we kept making new performance highs until a week ago, it has been a real struggle. Ironically we had a 940 technical swing objective on the S&P, it just was not supposed to happen until early next year (the 1580-1260-940 macro scenario).
Because the market has reached the 940 downside objective (while we were long) we are hanging on to our long positons in our Regular “Aggressive ” Portfolio and are taking the “Conservative” portfolio from its all cash position since May 19th to 50 percent long tomorrow morning.
Probably of more importance now is the work we are doing as to what kind of portfolio approach we want to follow in an Obama Administration. While you may find this difficult to believe I am not a lover of a lot of Democrats, especially the very liberal, Schumer and Pelosi come to mind. Furthermore I have no love for Rubin or either Clinton as I believe they aided and abetted Greenspan in his devastation of America. So it will be interesting as to what develops here, who the Treasury Secretary will be and who the new Fed Chief will be when Bernanke’s resignation is requested.
9:29 PM CDT