The market is interesting here.
Yesterday I heard some bozo say "we are more interested in the late cyclicals, than the early". Tony and I have had this discussion.... and Certainly Maybe I'm wrong.
You need a consumer to buy a new computer, to make the microchips go up, to then make the company build new plants, and to need more materials for new plants and new Computers.
This Hyperinflation trade... makes me think you all are caught in last years bullshit again.... but you swear... it will all turn out better this time... not the fucking train wreck it was last time. All the bullshit you can drop on your foot...
Seems like in that situation, I'm more into buying a gun and some Wheat for the old BombShelter.
But as I sit here.... I wonder where are the growth sectors... what is it that people are going to buy more of over the next few quarters.... I get nothing...
So, like when we get to this last 10 pts on the spx to the 875 level.... I'd play it below there(short)... and play counter to an impulse above there.....
As much as ... I hear all the Bla bla bla in the market, I need a growth theme to invest in.... Not Black Helicopter nonsense, and "Valuations are great"....
It's all risk..... as far as I can see... Sure there is a seasonality play in oil.... but...
get real...
Thursday, May 28, 2009
Risk reward and maybe some macro.
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2 comments:
Yup. Lots of conflicting information, and maybe this is all part of consolidation?
As T.Lo has pointed out, there is massive correlation amongst the various stock allocations, which is why she adds so much Treasury and GLD allocation I suppose.
One interesting thing,and I do not how to interpret this: Despite all the gnashing of teeth about inflation, AAPL and HPQ (Consumer products and tech) have outperformed basic materials and oil over the last year.
One amazing thing (to me): Coach (COH) and SBUX, companies that are thought of as the poster boys for opulence and extravagance, have outperformed IYM and oil. Does this mean that we are now early or middle cycle? Are COH and SBUX relative overbought, or oil and IYM oversold?
I just think that oil and basic materials have room to run on reflation and economic growth.
I guess what I'm getting at is that the fall was like a huge boulder was thrown into the pond...
... and only now are the waves slowing down. The market cycle based on sector analysis has been affected by the huge perturbation and difficult to interpret at the time.
Obviously we have had massive deflation and obviously this will need to be reflated at some point. If you needed to own stocks, oil and IYM have been no-brainers.
The financials get all the attention, and that is understandable since they were the catalyst for the perturbation, but they are really untradeable due to information dearth. Take XLF out of the picture (since it was massively oversold due to information dearth, who would survive and who wouldn't), and the other sectors kind of make sense-- in retrospect.
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