Our good buddies at the Fed said they didn't cut rates now because they wanted some ammo left for later in the year. My thinking is something (whatever) may go wrong in Iraq, and there's an oil shock. Then again, the Fed's weak dollar policy laid waste to this market, and sure, they want the traditional post-crash rally, but I'm not sure what they want after that.
At Dow 7550, valuations looked OK to me but certainly not cheap. At Dow 9,000, valuations are getting stretched again, as former Fed vice-chair Alice Rivlin recently commented an in interview on the tube.
So, what to do?
I started to list a few specifics, then deleted them. I recently spoke with a broker buddy of mine, who is a whole lot more interested in playing the crashes than he is going long. It's that dang valuation thing, I guess.
So, my recommendation would be to sit tight for now, don't worry about it, and then when the next new thang comes along that looks like a good investment idea, just short the crap out of it.
PB |
