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Wednesday, March 4, 2009

Wednesday Recap: Round and Round We Go ...

"Every why hath a wherefore." - "A Comedy of Errors", William Shakespeare


Well ... it seems that my podcasting host site (Podbean) suddenly has a problem with the sample rate as it is produced by my Audacity recording software. After about 3 hours of messing with it, I decided to press on with a text entry. So here I am with a short "recap" of the week thusfar.

Did anyone else happen to catch the Congressional Q&A with Benjamin Bernake this week? I hope the inflationists were paying attention. Chairman Bernake's statements regarding the possibility of inflation 'down the road' (as I hear many of the inflationists saying now), was met with a very brief, very succinct, and very clear statement.

I'm paraphrasing here, but it was something along the lines of:

" ... of course, in any case where inflation would begin to appear, we would raise interest rates."

There it is folks. Even in the current environment? The Federal Reserve would have no problems raising the interest rate to curb inflation if they felt it was getting out of control. Of course, some 'target inflation' is acceptable, and even desired. But if anyone truly believes that if they are faced with the choice of ... a) leave the interest rate alone, and allow "hyperinflation" to come about - in effect - destroying the future of the Federal Reserve, or b) choosing further deflation by raising the interest rates and ensuring the future of the Federal Reserve? I mean come on. They would raise the interest rates. I'm personally wondering when the 'hyperinflationists' will admit defeat. At what point?

Personally, I found the whole thing rather comedic. Members of Congress were asking him questions that had ABSOLUTELY NOTHING to do with the Fed. Healthcare? Are they serious? It's as if they didn't even know what the Fed's job is, and what they themselves had made themselves responsible for. All Chairman Bernake could do is look back at them, blink, and state: "Well, that's not really under the pervue of the Fed. That's a legislative matter." But it's as if they weren't hearing him, and would ask him basic questions regarding economics.

As for myself? I've been having a fun time in the Ventrilo Voice Chat Server with everyone. I had a 'so-so' trade on Monday for about $506.00 profit. Mike has been tearing it up lately with day-trading the Euro Forex futures. It's pretty nice to have a 'trading venue' to talk shop when you're doing nothing but stare at an OJ trade that just refuses to move one way or the other.

As far as the stock market? Well ... we'll see. A one day rally does not a bottom make'. It's one day. Let's see the process unfold. Anything can happen in the future. Anything at all. What if we have a relief rally that is purely technical in nature, and the market 'mob psychology' begins to hone in on the infrastructure improvements from the Economic Recovery attempt by the current administration? A relief rally, in such a case, could turn into a bottom. Especially if someone grew a brain, and decided to organize a transparent exchange for the OTC, CDO Derivatives market.

Or at the same time? We could have more of the same. It's wait and see.

As for myself? I just want O.J. to move one way or the other ... There is nothing more infuriating than getting into a trade, and watching the market close, right where it opened up at earlier.

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Note: This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 13 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

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