Lookalike Coaches and the Market

Two days of consolidation. Probably means a pop to new highs in the next couple of days. Whisper numbers are very good for the non farm payroll report. More government jobs and very favorable birth death adjustments could mean a very good number. An expected equity pop would come with that but if the 10 year goes bonkers and breaks 10% the rally should be short lived.

I didn't mention it but the pending home sales index yesterday came in very low. That combined with the MBA Purchase index which came in at a 12 year low may indicate housing may be starting its second leg down at long last. We shall see.

At some point oil and interest rates have to be a very big negative for the equity markets. At some point.

Bill Gross is out with his January Investment Outlook. You can read it here. He focuses on blasting the government. I couldn't agree. Both parties have sold themselves to the devil. Bush helped get us into this mess and Obama is making sure we stay there.

From Bill Gross:

What amazes me most of all is that politicians can be bought so cheaply. Public records show that combined labor, insurance, big pharma and related corporate interests spent just under $500 million last year on healthcare lobbying (not much of which went to politicians) for what is likely to be a $50-100 billion annual return. The fact is that American citizens have never been as divorced from their representatives – and if that description fits the Democratic Congress now in control – then it applies to Republicans as well – past and present. So you watch Fox, or is it MSNBC? O’Reilly or Olbermann? It doesn’t matter. You’re just being conned into rooting for a team that basically runs the same plays called by lookalike coaches on different sidelines. A “ballot box” pox on all their houses – Senators, Representatives and Presidents alike. There has been no change, there will be no change, until we the American people decide to publicly finance all national and local elections and ban the writing of even a $1 check for our favorite candidates. Undemocratic? Hardly.

Some chatter about politics. His investment conclusion:

Additionally, if exit strategies proceed as planned, all U.S. and U.K. asset markets may suffer from the absence of the near $2 trillion of government checks written in 2009. It seems no coincidence that stocks, high yield bonds, and other risk assets have thrived since early March, just as this “juice” was being squeezed into financial markets. If so, then most “carry” trades in credit, duration, and currency space may be at risk in the first half of 2010 as the markets readjust to the absence of their “sugar daddy.” There’s no tellin’ where the money went? Not exactly, but it’s left a suspicious trail. Market returns may not be “so fine” in 2010.