It’s the Economy Stupid

Well that nasty downgrade last week resulted in the 10 year note going from over 3% to about 2.14% where it closed today. That big bad 30 year mortgage is now obscenely cheap, assuming you have a 42,000 credit score, perhaps you can now get into that little starter home with the Mrs.

The downgrade is so last week, it’s the economy and the double dip that’s coming that has people’s hair on fire.. Pieces of Europe are falling into the Mediterranean on a daily basis and that slow motion train wreck is moving a little faster now.

This market is spinning more than a cloths dryer and things are getting hotter than a two dollar pistol. Xanax and Pepto are being consumed on trading desks at record clips and most hedge funds are never hedged anyway so they are forced to sell.

I’m still all cash and I am doing some trading intraday but only in the inverse ETF’s. It’s easier to play the turns and if your on the right side it doesn’t feel like a  bear market at all.

Stay smart, don’t chase anything, and have ridiculously tight stops if you must play, but the best advice is to wait this one out. More drama tomorrow. Good luck.

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