Monday, October 13, 2008

Where to go from here?

Time to jump back in to the long side on equities?

Frankly, I don't know.

I'm thinking the economic numbers coming out later this week will be quite ugly.
Then there's the matter of the CDS auction for WaMu next week.
Then there's the matter of the CDS auction for Iceland's 3 banks, sometime in the next month.

Tuesday has no real economic numbers, but we get a slew the rest of the week: Retail sales, CPI, TIC Purchases, and building permits. These are all lagging indicators and will probably be abysmal.

Will the market discount them as irrelevant, as worsening primarily because of the credit crunch rather than real factors or as relevant evidence of a truly momentous downturn in the business cycle only partially or minimally related to the credit crunch? I don't know, I'm not psychic.

Standing aside is a position and its often the hardest one to take, but I see no clear trade at this juncture.

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