Not Selling.... (Yet?)

Last week, I made a host of purchases during weakness Monday... and then after the huge move Tuesday on the Federal Reserve new interventions (I know.. I know... it is hard to keep track of which ones, but this was the $200B one), I sold most of that stake Wednesday.

Following a similar pattern, yesterday I made a large bucket of purchases, but despite this huge move (again on a Tuesday) I am not in a rush to sell. Why? Well the market has an air of bulletproof-ness at this moment. No financial will be allowed to fail. The Fed will backstop any bad assets. And we are flooding the market with liquidity. So people can feel invincible now. No matter what they do, the powers that be will help us push assets higher. Nice eh?

As I wrote in the blog, I debated buying Goldman Sachs (GS) yesterday at $145 but didn't have the nerve. It was that damn free market thinking that got me again - the ridiculous use of logic of the way "things used to work". With 1 competitor destroyed, and the Federal Reserve backstopping all bad assets Goldman Sachs is probably worth $300. And yet I did not buy at $145. Ugh! Today $170.

We have a bit of resistance at S&P 1320, but the Fed and PPT will take care of that. No problem. Maybe we'll have to worry a bit at S&P 1360. Ahh... having the Fed protect my stock account is... priceless! (Speaking of which VISA IPO imminent). Whatever I do... whatever choice I make... Ben is on my side. Feeling like 1999 all over again. I hope no one wakes me from this dream world where assets can only go up. I love it here... unicorns abound, and mermaids off in the distance. Nirvana.

I usually feel angst on Fed cut days because no matter what the result one never knows what how bipolar market will react. But in this current era we know its going to be something ridiculously huge as the Fed is the market's bi... female dog. What the market says to do, the Fed will do. Or the market will threaten to go down big and cause politicians to get fired. It's sort of nice. We are bulletproof. This Kool Aid is wonderful. Waiter, may I have another?