Did you have fun when Japan crashed the markets?
How about when the S&P knocked us down last week? If not, then you probably weren’t hedged and you weren’t hedged because you don’t buy your protection when it’s low, which is when the market is high. I’ve said enough about us being in a channel and I’ve made enough titles of posts "1,333 or Bust," referring to the line the S&P has to hold (for more than a day!) in order to give us a properly bullish sign and I’ve said that there isn’t enough money in the World to support what is now $112 per barrel oil so I’m not going to bother – that’s why we have archives…
I laid out a case for Members last night as to why earnings are deceiving as we are hearing a lot from multi-nationals early in earnings season and they get some pretty big benefits from the exchange rate, which is running 14% better than last year. I strongly advise all Members to read my example on YUM brands as well as look over the charts and other stuff I’m not going to bother repeating here.
What I will repeat here is what I said in conclusion, which is:
I look at stuff like this (the Dollar’s effect on earnings) and think "surely I can’t be the only person who sees this" but I can’t find anyone else discussing it. I just don’t see how there can’t be quite a few fund people who know full well that this is all BS but, if so – what is the logic that keeps them playing the game? I guess, like us – they are worried about losing out to inflation so they can’t really stay away but we are currently ignoring a staggering amount of bad news at a complacency level we haven’t seen since 2007 (VIX under 15).