Monday, June 23, 2008

An Hors d'ourvre


My stylized pic of one of my favorite appetizers: prosciutto that is rolled around blue cheese, lambs breath (green) and dried cherries.

John Mauldin has an "Outside the Box" missive:

A Kind Word for Inflation
by Paul McCulley

The argued point is that real inflation will be with us as the Fed will not risk deflation (recession and even perhaps depression that sometimes accompanies massive deleveraging).

I know that Don Coxe is calling for a bond rout--but he was wrong on bonds for too long over this past cycle. While I think he stands head and shoulders above most market commentators, I don't buy this view on bonds which is why today's OTB missive reverberated with me particularly since.....

I've was thinking about utility stocks. If bonds are going to be low interest rates AND utilities pay a better rate then utility's time may be here. I've been hesitant because I've been expecting interest rates to increase; YET I recognize the deflation issue. If the credit morass as more ass to show us, and I suspect that it does, then deflation would be a reasonable worry.

Anyway....watch the utilities.

1 comment:

nice said...

I gotta say that today was a pretty lame attempt for a bottom...

Obviously a lot of money is cleaning up for EOM early - afraid of what Ben B might say - evidence being that the favs were down and the beaten down up.

TRIN behaving a bit odd as someone pointed out.

Gold magically capped at $900
Oil unchanged and resilient

Futures diverged positively for 2 days now - have to see where we stand after Oil report and the DAY AFTER FOMC.... for now tentatively long various non commodity areas and short some commodity areas (with some OIL hedged until the report tomorrow) - most US index shorts covered (but still holding some incase Armageddon hits).

Staying with small positions until after tomorrow - lately the FOMC day has been a fakeout - or will Ben B deliver a clear concise message?

I wonder if perhaps a few bear/bull traps are now being set for the favs/out of favs?

nice