Tuesday, December 8, 2009

Where are we?

Where are we? Undecided. Undecided for a number of reasons. Just to state the obvious, the stock markets have gone up a lot with some tiny better than expected corporate results and economic data, but not strong enough to fuel speculation things will improve a lot more from here.

The dollars has been extremely oversold and already showing some signs of squeezing the bears out there. Gold bugs though unfazed with the "death threat note" but it has been almost a mainstream investment idea over the last few years. The weak hands are unsure of themselves, it will take a bit of time to shake them off.

Econmic data merely confirming the worst is behind us but no one is sure of what tomorrow will hold. It's very difficult to quantify tomorrow. Not sure whether the US economic growth going to be 1%, 2% or 3-5%. Optimists and pessimists are equally divided.

Central bankers are behaving, well, chicken little. It is better to fan inflation rather than losing their jobs. They will keep singing The West central bankers are concern with weak economy while the East central bankers are concern with asset-bubble. The finger pointing match is on but neither one of them want to take concrete actions. No wonder we are all so confused.

Well, under this kind of environment, some will turn to astrology -- reading moons and stars. More scientic one will turn to charts. Well, it's confusing because it's appear that we are moving out from the the trend channel but moving sideway -- equal number of buyers and sellers. Not enough bad sentiments/news to push it down, not enough good news to push it up either.

Well liquidity is still a plenty on the sideline but is still very unsure of what to do with it. Are we at (1) the basebuilding phase --- taking the steam out of the system very gently over a longer period of time or (2) in the making of violent correction to chase away non-bull believers? Sorry, sadly, madly, your Turtle is unsure whether it is (1) or (2). Take care.

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