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Tuesday, August 25, 2009

Parabolic Market Orgasm

On Friday, I finally capitulated and covered positions I held for waay to long. Monday the market opened significantly higher only to close lower. Today may have been the top, but I am no longer in (with size) highly leveraged ETF stocks.

But I did put right back on straight stock shorts today. If today was the high and the market is about to turn, it is quite amazing how the market did exactly what was required to get me out of the market just in time to turn. Really great work.

But there is hope for the USA all over the long term, but much higher risk in the short term. A federal judge has ruled the fed MUST disclose information about how taxpayer money is being used! This is fantastic to start to rid the corruption from the system, but may have the unfortunate side effect of triggering a panic stock sell on financial companies.

Goldman Sachs is being pursued by regulatory agencies after the WSJ prints an article about GS and questionable practices. The public acknowledgment of shady operations forced the US government to initiate actions to ENFORCE THE LAW. Time will tell if they actually do, or only give lip service when there is publicized news. For a great, long, rant on corruption see a recent Karl post.

The market isn't valued highly right now based on fundamentals, it is high because it is based on lies, fraud, and lack of law enforcement. As the corruption is addressed, the market reality will come into focus. These small but significant steps to start addressing the corruption, along with the soon-to-end practices of "order flashing" and "high frequency trading" will start to rid the system of market manipulation.

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