Market update

Futures seem to be tilting a little lower, however, the big news of today is that Ben Bernanke will be reappointed as Fed Chairman. I believe that was the best move Pres. Obama has made and I commend him highly for this. Bernanke, in my opinion, saved our economy from absolute disaster, by pushing "all-in". Of course, we are going to face some pain for this in due time, as Warren Buffett highlighted in his great NYT opt-ed last week (if you haven't read it, it's incredible - just go to nyt.com and search warren buffett, it should still be there). As for investing or even trading this market, it remains difficult. I have told many people and discussed with some money managers the basis of which an investment decision needs to be based upon. Before you buy, sell, or short anything; the main question you need to try to grasp is "Is this economic recovery, truly real?" That is really the question everyone wants to know and personally I am unsure because I look at credit card trust data and other economic variables that show good signs; however, I also see looming headwinds like higher tax rates on corporations that could stall economic growth. Regardless, that is really the main assumption of your investing decisions and then you place your bets. High cash levels balance out uncertainity, so that is my path. The bulls believe that the earnigns cycle, due to the replenishment of historically low inventories, extraordinary monetary stimulation and the productivity gains from draconian corporate cost-cutting,is so strong that it will trump the consequences of policy. They may be right; however, timing is difficult to grasp - after all how many people where buying equities in March? On the flip side, the "bears" see higher taxes, interest rate risks, and high umemployment looming. I used to lean to double-dip recession and still do but am beginning to think twice. On the way down, we had no government or fiscal/monatary actions, now we do. All in all, I will be trading cautiously and I don't believe this is a time to be too bullish, nor too bearish. For "speculative" trades - hurricane season is live and in full force - if you want to gamble on mother nature (yes, firms have meteroglists on staff to help predict this) there are stocks that work if hurricanes move through. Speculative nat gas plays work the best.