Who Woulda Thunk It

I further trimmed my shorts into the closing bell. My net short position is now quite small. I would have much rather seen a sloppy close. While the market has the potential to bounce, I don't expect a very strong bounce.

What has been the strongest asset class this year? Treasuries. Who woulda thunk it?

3 comments:

PJ said...

Me ...

The US government and the Fed will soon cease leveraging up, and at that point the deleveraging by the private sector will become the dominant economic reality. We'll have a double-dip economically, and all risk asset classes will come under pressure.

How Treasuries fare will depend on the balance between deficit spending and the rise in the savings rate and collapse in private borrowing which will free up bank deposits and other assets to go into Treasuries. I don't dare predict the course of interest rates, and anything could happen, but Treasuries are more likely to appreciate than other risk asset classes. With rising public opposition to deficit spending and the loss of the Senate supermajority, it will be hard to increase the federal deficit further.

Most likely I think is that Treasuries chop sideways while other asset classes depreciate. That's why I'm staying short equities, even though we're at resistance from Nov-Dec congestion and I think the chance of a small bounce tomorrow is good.

Tsachy Mishal said...

I wish the futures would sink a little more on Google. i would clean up the balance of my net short position.

Anonymous said...

going back to 1130. then down from there.