The income sell off continues. Albeit at a slightly low rate of
decline.
The real question that I have is will the JULY 2003 lows hold?
If you punch up a chart on ANY income instrument you will notice that
the old July Low has not been breeched, yet.
But it is getting very very close.
So, if you haven't sold out yet, perhaps waiting to see if the lows
hold would be interesting?
Or, as one person I know said: "If you bought the damn thing for
INCOME, why bitch about a loss of CAPITAL?
There are an awful lot of 8% to 10% yeilds available now. Yippee?
So really the NEW CARRY TRADES are alot more profitable now than they
were before the plunge.
Why?
Well, Mr G is only "talking about talking about" raising rates!
SO, I'M STICKIN' TO MY STORY THAT GREENSPAN WILL NOT RAISE RATES.
NOT NOW, NOT EVER! WHY? WELL, TWO WORDS COME TO MIND: FANNY & FREDDIE! Nuff' said?
GREENSPAN LOVES THE BANKS, AND THE HEDGE FUNDS TOO. AND BANKS AND
HEDGE FUNDS LOVE THE CARRY TRADE. ALOT.
FRANKLY, THE MACRO-ECONOMIC CONSEQUENCES OF A 5%+ 10 YEAR BOND NOW
ARE TOO HORRIBLE TO CONTEMPLATE.
UNLESS AND UNTIL, THE JULY LOWS ARE CLEANLY TAKEN OUT;
I THINK THIS WHOLE AFFAIR IS JUST ANOTHER "MARKET EVENT," AND A
REPEAT OF THE "HEAD FAKE" OF LAST JULY.
Postscript: Very likely the economy will suddenly be "found," NOT TO
BE BOOMING, as much as we thought. Look a Walmart today.
And, anything less than 300,000 jobs in April will be cause for
alarm. Was the March Jobs Number just a strange seasonal anomaly?
Not to be repeated. Well, something about that number just didn't
pass the smell test with me. So stay tuned......
