Frank re: ["Slider... ah, finally the explanation for your portfolio allocation."]
Frank... I think one of the great ironies of this market - is that many Bears & Goldbugs have had the correct-reality view on WHAT is going to happen and WHY it is going to happen.
BUT ! - I think (or at least, have recently begun to RE-THINK) that the only mistake "we've/they've" made and may continue to make... is underestimating the power and most importantly - the STAYING power and near endless resources of the FED in "stabilizing" and managing the market, the POG, the descent of the USD and the economy.
I don't think they'll spare the paper, or ink necessary to do WHATEVER it takes....and Greenspan is going to retire at the end of this presidential term in 2004 - so his wish for a gracefull exit & saving his legacy at any cost & Bush's re-election desires are now mutually aligned.
If Greenspan had retired and we had a new Fed Chairman... I don't know if things would be allowed to play out this way... in fact; I don't think they would. But by fate... Greenspan & Bush's motivations are now mutually aligned and I don't think that bodes well for the Bears, or the Goldbugs over the next 18-24 mos... as I think Gold will (must) be capped at any & all expense and that the markets will equally be supported - because we've reached a crisis level to where both Bush &Greenspan and Wall St - have no choice...
Remember the old platitude:
"Don't fight the Fed"
...I think the Bears we're successfull in fighting the Fed, especially for the last year and that myth has been debunked...perhaps leading to their over-confidence here; but, when you have the mutual alignment of the Fed, the President and all of Wall St - along with a US Consumer that is unwilling to reign in its own unquenchable thirst for easy credit & reckless spending... I think fighting this new unholy alliance - will be both futile and misguided... untill after the 2004 election anyway...
That's my "BIG PICTURE" fwiw.
I think the time has come for both Bears & Goldbugs to be Pigs that got Fat (real FAT by the way)....but, to resist the temptation to get over-confident here and become HOGS that get slaughtered.
That's a tough timing call to make... but, it is ALWAYS a call that MUST be made...when, enough - is enough...
It's a call the Bulls failed to make atop NAZ 5,000 & DOW 12,000.
Hopefully; its not going to become a call that both the Bears and the Goldbugs fail to make here shortly.
I think the next 24 months leading up to the 2004 Election - will be HIGH RISK - LOW REWARD for virtually everyone... as the "game" will be STABILIZATION and support.
Imho, The next two years are going to reward 2 things above all else:
1. Patience
2. CASH
And yes, Frank - that is why I am beginning to toe dip long
into sectors that have ZERO positive sentiment such as airlines (via LEAPS) and am beginning to close out shorts
(Other than subprime/consumer credit/Homebuilders)and am holding only what I view as a "hedged" 15% Gold/Silver allocation - as a "hedge" to any unforseen Rogue Wave Crisis Event...and that is also, why I NOW think that:
CASH IS NOT JUST KING.... IT's THE ONLY THING ~ |
