Friday's Market preview

As I ended yesterday's column I pray I am wrong, so far I am not wrong. Thursday was brutal.

  

The market here is telling us we can no longer put off the huge pile of debt in Europe. Part of what happened today is nothing more than people fleeing Europe with their assets for US Bonds and cash. NY banks had to begin charging fees for all the cash that flowed into their coffers today because they simply do not have anything to do with the money such as lend it out when no one is borrowing for anything in the US. Europe is about to implode, countries such as Greece, Ireland, Portugal, Spain, and Italy, is are in deep trouble with entitlements and some one there needs to move forward with some leadership on reducing their social programs. Note Italy is the eight largest economy on earth so frankly there is no bailing out for them so this is now serious business. They need a fireman. The European Bank is the fireman there and he is not in sight.

 

The USA desperately needs leadership as well. God bless him, but our current president is lost in his job. Frankly way over his head and worst yet does not know it.  If we do not get our government in fiscal order we are headed the way of Europe.  He continues to want to tax more, and regulate more, and that only scares investments in new business and the resulting jobs running for cover. You demagogue people who work hard and invest and this is what you get.  Some pro-growth policies would help right now but with current leadership none is on the horizon. Add in a media. both print and electronic,  that has so many people employed who are clueless to what is going on here either and therefore you get nothing but gobley gook from them.  However kudos to CNBC today that after a embarrassing swim in the default panic pool settled down and did some good work today.

 

Friday's market continues to worry me here. As I mentioned yesterday we could see just total carnage Friday.  A good employment number will only convince people that the number has been politically altered to help the president. A bad number will just add to what people already believe.  If by chance there is some small rally early on, be alarmed as it will likely be nothing but a dead cat bounce.  Basically a move upward at the open will offer the chance for some who want to get out to finally get out and will likely end in a cascading market towards the end of the day. Kicking the can down the road is over, the can is kicking back.

 

I am now down over 10% and much of that occurred during the last hour when people just wanted to get out at whatever price they could get. As I told a couple of people today if you have not sold by now it is too late. Fear and uncertainly reign and one is best served not to allow fear to take hold. Friday could bring a good bit of margin calls for people who just trade so that will also be in play as well. In the end the market will bottom somewhere were it actually supposed to be in an economy which is quite bad. 

 

I still have three stocks in the green and in a market like this you look and see which stocks are holding up in panic selling.  SO, BCE, DUK, JNK, LO, MO, NNN, and as mentioned before the agency REITS are holding up well and fortunately all are in my hedge fund.  Of course I have some others that are getting killed price wise.  I will be up early Friday taking in the jobs report and preparing to see what happens. History could be in the making.

 

The beach is still calling....