Tuesday, December 22, 2009

December 22, 2009

average retail investor has not participated in rally. Net outflows for equity mutual funds are huge for 2009. Short the dollar trade has helped the market this year. $400B in '09 into Bond funds.

We are close to full valuation based on technicals. We have 0% interest rates, market momentum and huge cash on the sidelines. Market could move another 15% which puts Dow at 12000. We are about 18% above 200 day moving average.

Incremental revenue will drop directly to bottom line b/c of extreme cost cutting in past 12-18 mos.

We have never had a double dip recession with these kind of low yields.

We like to see strengthening dollar with a rising equity market.