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The Hump Day Fray: Can the Contagion Coagulate?

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Cumulative imbalances persist.

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You Hear that Elizabeth? I'm Coming to Join you Honey!

Yesterday, I asked the question: "Is The Big One Coming?"

It spoke to the springing leaks in the financial dike, the bottom of the Washington gunpowder barrel, the VXO trading with a two-handle (well below previous fear fulcrums) and, perhaps most important, social mood and risk appetite.

Those last points will be put on parade as the September debt issuance comes to market. The dynamic and dichotomy remains in place-either credit has to improve or stocks will swoon.

We can't note that enough.

Few things in the market are ever black and white-or green and red, as the case may be-but this is seemingly one of them.

Risk management over reward chasing, discipline over conviction and debt reduction, as a function of choice rather than need.

Some Random Thoughts

  • How quickly can markets and moods shift? In a New York Minute, my friends, which seems particularly apropos right about now.

  • I digested some Campbell Soup (CPB) calls yesterday but the market was pretty thin. Ironic, given the "Chunky" persona of the brand and risky in front of today's earnings.

  • Pep told me the USO was on a TD-sequential "buy" late yesterday, which was fine by me.

  • Someone once told me to never let an opinion get in the way of making money.

  • My "opinion" is big picture deflation but, just as the short side seemed counter-intuitive during the ramp higher, I'm playing for a crude bounce as perception toggles towards reality.

  • Remember, 3:30 EST is the double-edged sword when redemptions kick in and buy-backs stop. Keep that in mind as we edge through the grind.

  • Check out the Utes-My Cousin Vinny can't be liking them right now.


Answers I Really Wanna Know…


R.P.

Positions in CPB, USO
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