Neither Bullish nor Bearish be
With the markets wrapped up in-between opposing forces we believe that our trading and investing actions have to reflect that reality. That is why we are long stocks a little as we let the markets wander through the coming election period.
Many pundits like to talk about how things would get better if the uncertainty were removed. Lets be clear of what that uncertainty is, will the Tea Party / Republican austerity approach win, will the Democrats get some new enlightened leadership, or will things need to get so bad that a third party that incorporates anger and middle class enlightened leadership rise out of the ashes. I don’t know, but a couple of things are for sure until Washington provides leadership that allows the middle class who consume 70 percent of our GNP to find a base and grow, things are not headed in the right direction.
Bernanke would do himself a favor to come up with some outside the box thinking before his much awaited Jackson Hole speech this Friday. He needs a way to get help straight to the middle class without going through banks or seeing it siphoned off into speculation. At the same time Obama and congress have to deal with the structural employment issues which are well known, the after effects of new technology and offshore employment.
My hopes are not high that real concrete solutions will be forth coming but on the other hand this is not 2008 again, things are not that bad, its just the solutions are difficult. I will not get real bearish unless the Republicans win the Presidency and Congress in 2012. If that happens look for 1929 X 2.
I will probably not be making comments until next Monday as I watch from the beach.