Replies to post #2170 on General Stock Ideas

[bigworld]

ombow: Thanks..... No, I was just thinking out loud. I did shift some of my TZA into VXX positions because I think the potential downside vs. upside is now more favorable with VXX. I will forward some info tomorrow but my hunch thinks you may be right about limited upside. I don't fear the fundamentals....I just don't know what Bernanke has up his sleeve for Tuesday's Fed meeting. If he unleashes Quantitative Easing Part II with another couple of Trillion $$ I'm afraid we could get a strong artifical rally based on liquidity. It would make the eventual downside that much more severe but in the short run it would further crush the people with short positions. I really do think this entire run up from the late August kiss with 1040 has been a Fed induced rally, starting with that 200,000 e-min purchase.

I'm normally a pretty jaded and cynical individual but I've gotten worse lately...working too much due to high demand and some family issues...a lay off in the family which I will have to assist with financially (a relative was employed in commercial real estate finance....lost his job and $120 K a year income with no immediate prospects....apparently a lot of commercial real estate employment being downsized out of existence in Chicagoland.) Anyway I'll post some info tomorrow on what my 'tea leaves' are showing.

[ombowstring]

bigworld, I happened to catch a few commentators on CNBC say that they think further QE next week would be a bad idea -- too much liquidity might tend to put upward pressure on interest rates and inflation and that gold would go to $1500. I agree, at least for the present. I still think that monetization of at least some of the debt might be the way to go. Geithner thinks the Chinese yuan is 40% undervalued so it must be a good idea to keep the relative value of a country's currency on the low side or else China would let the yuan appreciate and that substantially.

There's plenty of cash around at this time, but apparently is not being put to use in the right places? I feel I'm in nebulous territory when I start talking about macroeconomic issues -- who knows, really? The story is that there are two widely recognized experts in the world today on macroeconomics, but they disagree.

I just wonder that if all this manuevering that the Fed, the President, Congress, Geithner, etc., are doing, and if corporations begin to unleash the $1.8 trillion in assets they're sitting on on their balance sheets, that the economy might start to turn around and the recovery gain strength -- not immediately or quickly, but gradually. I hope so for all our sakes.

http://www.marketwatch.com/story/us-stocks-to-try-for-fourth-week-of-gains-2010-09-17