GDP

As we all expected, GDP was terrible. There is no one out there expecting a magical turn around in the economy soon. There isn't a whole lot to be cheery about in the economy right now. That said, we are still the largest most innovative economy in the world. There are still companies out there making money and we will rebound from all of this.

That said, I am still not putting all of my capital to work going long anything. I am still net short equities in my portfolio and I plan to be for the foreseeable future. I have given some picks in previous posts and I am sticking to them. However, I still have a lot of my portfolio in cash. I might add a little to the (DIA) position I started a while back. I will be interested in seeing how the Dow reacts to the psychological 7000 level. If we blow through that today, there is probably a lot of downside.

A quick word about the Bank of America (BAC) bonus fiasco. Why the secrecy? Why are Thain and Lewis withholding information from the AG if they did nothing wrong? If Ken Lewis is throwing up his hands saying he didn't know anything, why is he being subpoenaed? Thain had to tell the NY Atty General something to compel Cuomo to subpoena Ken Lewis. I think there are some rats out there. There is no other way to look at this. This is theft. It is the outright theft of taxpayer dollars. NO ONE deserved a bonus at Merril. You get bonuses when the company makes money. The company couldn't get itself sold to Bank of America fast enough. The losses were criminal. To pay out bonuses to executives (or anyone for that matter) when the company loses ANY money, matter the less billions. That is theft. There is nothing else about it.

How about an option trading strategy for today? I think I am going to spend the majority of the day on the sidelines. There is too much uncertainty out there. When I say uncertainty, I mean we are so oversold, yet the market continues to sell. If everyone was just negative or just positive, I can trade that, I just fear jumping into anything short at this time and having my head chopped off by some crazy short covering rally. Just like any trader, the most important thing I do is manage risk. When the market sends me risky signs, I stay on the sidelines. I might be back before the weekend. Until next time, stay low risk..