Tuesday, December 4, 2007

A light dusting, icy roads; use caution

Ever think a weather forecast could provide market advice? This week's has.

Monday I woke with a terrible cold and promptly went back to bed. I woke late in the afternoon to realize that the market was stumbling like an out of work writer (when does a writer ever have work?), after a night's worth of "inspirational" drinking. It weaved back and forth, back and forth, finally settling down on the curb to mull the comfortableness of gravel.

There we found it Tuesday as well. And the weather forecast popped back into my mind. After snow, there are two types of weather: incredibly bright and sunny, or days more of ice and snow. That's where the market is right now.

We all know salvation is at hand. Next week, the Fed is going to cut rates again, perhaps by 50 bps, but almost certainly by 25. But this week, we're still suffering from subprime-November, with the financial companies all getting rating downgrades.

Week outlook? Icy roads, use caution.

[Edit] I have also received reader feedback that they wish to be walked through a real example of option trading. I will be working on that for posting by the end of this week.

1 comment:

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