Back in the early 80’s when I was just a wee lad, a very wise man told me that the market is driven by rates and fighting the guys in the Ivory Tower that set interest rate policy is a losers game. The argument can easily be made that we are Japan and that rates need to be kept near zero because we are so screwed, that may be true, but the fact still remains that rates are basically zero.
The “light volume” argument is silly too. When you lose a couple of thousand hedge funds and two major investment banks like Lehman and Bear, volume will have a tendency to slow a bit. The boomers probably ran and won’t come back for a long time as they still are feeling some pain, especially if they sold at 666.
Bottom line it’s a liquidity driven market, but does it matter how we define what is happening? I care nary a wit as long as I make money. Yes,we crucify Geithner on the blogs, I call him the lolly pop kid and yes Uncle Ben walks the Halls of Academia late at night in his own mind, cheering himself for diverting us from the next crash. Yes, he actually makes the cheering sound that we did on the football field as kids. Scary visual I know.
Bottom line, sit back, relax and enjoy it while it lasts, because it never does. We are going higher for now I think. Are we topping or consolidating in here? Tough call for sure, but that’s what makes it fun.
Tuesday, March 09, 2010