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Keep Your Eye on Best Buy


Retail rally may get backed up by fundamentals.


Greetings from Totally Burned Out, where I'm staring blankly at my screen and pondering how this became a 9-day week. If my life had a ticker, there'd be one of those little graphics (called "a bug" in the TV biz) counting down the hours until I sign off from Times Square this evening.

Here's what I'm watching in an effort to keep myself from surfing old heavyweight fights on Youtube.

  • Another day, another screaming rally in General Motors (GM). The company's getting free money from the Government, and the plunge in crude is making our aversion to gas-guzzlers look very much like a summer fad. GM is also today's "Stock I should have bought when I said I wanted to." In this case, that would be about 10 days and 36% ago.

  • This market humbles us all, is what I'm saying. Especially this year. To use the metaphor of 1970s boxing -- by which I mean "keeping it mainstream" -- trading in 2008 is like being Kenny Norton. You can go from world-beater to wooly beating in a heartbeat.

  • Speaking of which, a very nice gentleman paid me a compliment regarding television last night in Grand Central. Flattered, I thanked him, and asked if he worked on Wall Street. "For now," he answered, "I'm with Lehman (LEH)". After a quick flashback through some of the thoughts I've had on Lehman over the last month, I decided to catch the next train and hang for as long as my new friend wanted.

  • True to my "take-profits-quick" general mantra and specific conversations on the dollar rally, I've taken just over half of my dollar ETF, the UUP, off the table today. I'm not sure I can follow through on the "smug" part of the suggestion, but there will a lot of caffeine between now and airtime.

  • Keep your eyes on Best Buy (BBY) when it reports next week. The stock is up more than 10% since the beginning of August, and there hasn't exactly been "strength" in the names who sell product at Best Buy (Corning (GLW) and Texas Instruments' (TXN) uninspiring guidance tweak). The retail rally is going to have to get backed up with fundamentals, at some point. That point may begin next week.

  • Frankly, I'm tired of talking financials, and I don't think the group trading weak tells me much about the tape. Apple (AAPL) is breaking below the earnings after hours level of $150, however, it seems a negative tape tell. Not to mention the troubles facing Apple itself. Great company. Lots of concerns. Bad-looking chart.

  • For those excited about politics as it relates to business. Obama is in favor of giving the automakers' $50 billion. McCain is in favor of $25 billion. Not since the 2004 election, which offered America the choice between two Yalie Skull and Bonesmen with C averages (but with 3 years difference in age) have we had such clear options in the race for the White House!

  • With that final bit of baiting snark, I'm off to Yoga and TV Land. Make it a safe and relaxing weekend!
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Position in UUP

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