First Blush on Bernanke
Nothing has really changed.
The net/net is that nothing has really changed--the FOMC is at the ready but they might be sipping water from a fire hose. The most important elements right now are the structural and psychological metrics, which may or may not be mutually exclusive. The former is a function of the bond insurer bailout and the latter is the perception of Fed Credibility. That belief system, domestically and globally, is being put to the test with each and every denial of recession and credit contagion.
With market breadth 2:1 negative and the funky financials acting as they are, caution is warranted. That doesn't mean press 'em (I took my trade in Bear Stearns (BSC)), it simply means respect 'em. These are trying times to be a trader and discipline must trump conviction regardless of which way you play.
Good luck, Minyans, be the ball.
Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at firstname.lastname@example.org.
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