From 15% (November) to 40% (December) to 80% (Now) Cash

Discussion in 'Trading' started by ByLoSellHi, Feb 24, 2007.

  1. I am stating it on the record now. A recession has already begun, and the composite GDP data (which lags reality) will bear that out by Q2 at the latest. Look at ISM, housing permit, mortgage application and Philly Fed data for last several months.

    Good luck to everyone here. I hope you all make money hand over fist (truly), whether you're short, long or, if mainly in cash, like me, at least break even with inflation (although I see deflation around the nearest corner) until better buying opportunities present themselves.

    I am still formulating my short position portfolio, which I personally find much more difficult to do than establish a long one.

    20% non-cash is mainly either in real estate or foreign ETFs (Taiwan, Korea and Brazil) now.

    If I had that 45 foot sailboat I've always wanted, I'd stock up on provisions right now, and take a nice, relaxing cruise through the caribbean for a while.

    I need all of your help in naming my sailboat. Thanks.
  2. Allen3


    I did the same with our retirement funds on tuesday and wednesday. I may be early but I had a good run from where I bought in may/june. It maybe like late 2003 and keep going. But to many ??? for me. I'm more comfortable with funds in cash for a little bit. Have a good break!

  3. Hy Jim. Thanks.

    I know exactly what you mean.

    If you look at the returns between June of 06 and now, the market has had amazing accelerating gains (velocity).

    That alone is not why I'm cashing out, though.

    The equity markets (broad - not just U.S) have risen dramatically over a one, two and three year period, with increasing velocity and participant equity exposure/concentration (with corollary margin debt concentration).

    If one couples equity inflows, which typically accelerate just prior to tops, with weakening U.S. economic conditions, and historically high levels of margin debt and insider selling (these things are all factually provable right now), and then add the liquidity contraction that will be cause by a shifting psychology of 'housing wealth' (to the downside) - not just psychology, however, because there will be a real, absolute 'dry up' as housing values either stagnate or drop and equity extractions dry up - you do have strong headwinds for U.S. equities.

    The question I have is what, in a truly more globalized and integrated economy, impact a less important, but still very important, U.S. economy in slowdown will have on emerging and developed markets from China and Russia to Taiwan and Germany.
  4. Allen3


    Good job

    Today is one of the days I wanted to avoid in my investments and just trade indices on the way down. Looks painful from the sidlines. I bet it is!

  5. I'm patting myself on the back, and my arm is tired. :D
  6. Allen3


    A little sad for everyone a day late a 3-4% short of where they were. This just re-enforces when you get the hebby gebbies get out you won't miss what you don't lose. Have a great day. Now maybe things can open up and get enough range during the day to make some headway my trading. Cheers!:p