The guv has sent up a warning flare about the upcoming budget this summer. He has given Fools fair warning: avoid California Munis at all cost. See, their bag of magic tricks is mostly empty. The current budget has all sorts of smoke and mirrors and accounting tricks, but now their secret stash is gone. Any closing of the deficit will involve real cuts and real taxes. This time around, a default is not implausible. [more]
I was pondering the contradiction of long term vision and it's lack of relevance to the current stock price of a company. [more]
I took advantage of the current rally to dump some of my stocks that no longer make sense to me. For the most part, these were commodity plays. I now have about 30% cash, more or less. OK: now what?
I noted, much to my chagrin, that the Fed has decided to keep interest rates at near zero for the foreseeable future. C’mon, Ben, are you going to duplicate the disaster that your predecessor caused? Our current depression is the direct result of Greenspan keeping rates way too low for way too long. Surely you understand this? I know that you are a student of the depression of the 1930’s, but how about the current depression? You must be guided by the experience of the immediate past, not just the distant past. [more]
For this, Bob Brinker gets credit, because he is correct. Yes, the Fed is printing money as fast as they can change the ink cartridges on the presses. However, much of this is on ice at the central bank, where it cannot cause inflation. [more]