U.S. Stock Traders on Dream Alert
Lets just start with the CNBC crew and the illustrious Cramer. They got really bullied up over the past couple of days after the S&P held above the 1250 level. Essentially they are looking for Europe to do a funny money deal . As I have been saying, I think Europe has seen what happened with the funny money approach that the US followed in 2009 and 2010. The commodity, gold, and stock markets had big rallies and the real economy and employment just plodded along. That doesn’t seem to be a good model to follow.
It would seem to me that Europe is going to follow an approach of a lot of little pieces but in doing so will be very careful to not open the speculative flood gates. We will see over the next few days. In any case my view on the possibility of further stock market strength has been based on more solid fundamentals. I look for employment to slowly strengthen further and for consumers to start feeling better as the next election makes the choices clear. The obstruction strategy of the Republicans will be opened up and analyzed for what it is, an attempt to hold back forward movement in our country.
So at the moment we remain short gold, and a little long stocks and want to see how the S&P acts on a test of the 1218 area and will be a wary buyer at that level.