Tuesday, April 28, 2009

Mr. Macro

That's me this week.

Swine Flu continues to spread and has put a significant damper on the market. It is exactly the kind of event that I would avoid trading/investing around if I could. The most likely resolution is that the disease is contained in short order, but since there is a small risk for something much worse, people are worried. One thing I would do is buy stocks I like longer-term if they hit levels that are attractive due to the Swine-related market weakness.

The end of the Swine Flue cycle may actually be the end of the bad news cycle for this part of the economic cycle. The Regulators have spoken on the Stress Tests according to today's press and of the large banks, only Citi and BofA need more capital and it is not inconceivable that they get it.

The very strange ballet featuring GM, Chrysler and anyone with money continues but is nearing the end.

High gas prices are ancient history and I do believe that house prices are bottoming here or have bottomed already.

When we are done with the Swine Flu, it will probably be a good time to start looking at owning stocks long term again. The economy has a lot of work to do to get itself back on track and there will be enduring negatives including the deficit and the debt that we will be saddled with. Nobody said it would be easy.

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