OT***
>> If consumer spending falls,
Jacob, I don't know. Consumer spending will not fall year/year. And it will not fall from Q3 to Q4. So as a theoretical proposition, yeah maybe there may be a couple of dollars in the short, at great risk. Meanwhile, the average run-of-the-mill tech stock made 30% in two weeks by betting on the notion that the economy will not collapse.
Please recall how the early-October drop in stock prices came about. There was a one-time 25,000 rise in new un-employment claims - to 440,000 (not sure of the exact numbers). Which gave rise to the fear that the economy was collapsing. But the following week, the number dropped by 40,000. Which convinced the people who watch this particular statistic that the seasonal adjustment had mis-behaved.
So that rise in claims spooked a lot of people. But it was just a noise spike and not a trend. However, the shorts piled on, and unfortunately, some longs got swept in the excitement.
So back to the plan. If it is pre-conditioned on a drop in aggregate spending, it won't happen in the next 3 months.
One more thing to consider re spending. Millions of Americans are not doing foreign travel this year. They'll compensate by spending for the holidays inside the US.
Sarmad |
