Beginning of the End or End of the Beginning

While the airwaves and market letters are full of pronouncements this morning, a few things need to be kept in mind. One is that leveraging takes a long time, I heard an economist recently say it takes 10 years, which would take it out to 2017.  Secondly, a new bull market taking off which was hyped in the first quarter this year was totally off-base.  So what does that leave us with, hope of QE3, and Germany going to church.  Probably neither will happen but the real thing to keep is not that a bear market is starting in stocks  or that the gold market is going to streak upward, but that this is the clean-out of irrational dashed hopes.

At the moment our objective on our short stocks / long gold position is 1225 area on the S&P and 1690 on gold, not that far from here.