Beware the Ides of March or a missive full of really bad analogies

Actually  the equity market are pretty much set to keep their gains! March hope springs eternal.
Our answer is simple: Doubtful for a retreat over the next two months but Mid May to End of June should see the FED start to really try to reignin  free money... Right now the perfect wave is allowing Dr. Bernanke to shine as a savior surfer and surf away in an idyllic setting. The fact that three board seats are still available at the FOMC must have something to do with it.  It's 4:30PM  and the sun is setting soon enough! Best be ready for a cold summer shower and some drinks!
We are more sanguine about commodities, especially food and energy, in the equity markets at this juncture. There are so many bids on the US dollar at this moment, this pig with lipstick is going to be the prom queen at the June graduation.

CURRENCIES
But like any commodity, when demand for US dollars surpasses supply, you are going to have dollar bulls saying all is well. Until the recent flood of new paper really hits the borrowers, it will be like an iceberg falling in the Jacuzzi. It always brings to mind the famous scene in the Titanic when Jack tries to stay on the doomed ship the longest time possible because he bloody well knows any time spent in the frigid waters of the North Atlantic will be the death of him and the Mrs. (please pronounce in a Scottish rogue for comedic effect). Ask Iceland bank shareholders if they have an opinion on the matter. So right now traders and old investors are moving to the top floor of this deck of wet cards using the US dollar as the quickest way to avoid a floundering pound and a Euro trading at a 10 month low. Is that wise? Gold in Euro terms always seem to us as the right move when pointed out by Dennis Gartman.

So if you don't like the analogies of  cold/hot showers, jacuzzis and Icebergs... bare with us we only have one more. In the world of international finance,  the sharks are now circling the easier prey that can be easily isolated. Take for example the  GBP. Start with some  juicy gossip about tyrant PM Brown, add a dash of bad economic data and voila,,, le disaster du jour with a Cherry-o on top!
The Euro is the most overplayed story with Greece playing  the eternal insouciant profligate ingenue... a $40BB check from the rich German uncle should be forthcoming if enough mea culpas are proffered... ( sorry don't know the Greek translation to Mea Culpas).
The Italians continue business as usual but our bets are still with Spain and its terrible economic situation. So the Euro will stabilize here but we believe on the next leg down it may hover near parity to the USD.
The Europeans will quickly understand that if the Euro falters there will be no growth for quite some time and they will start to import inflation.
In the US, the government continues to dole out projects and expenditures are out of control. The real economy is masked by Uncle Sam projects of dubious value. I We are not sure the Pentagon expenditures fit in as infrastructures projects. Rebuild America! right, with bombs, Humvee s, Aircraft carriers and drone planes? Did I ever mention the expression one-term President?

WHAT to DO
We suggest you do a very strong Spring cleaning, push the outlook 5 years from now, wasn't owning Exxon, Intel, Petrobras and Nestle and other large well capitalized companies remains a much wiser choice that some NASDAQ darling with earnings "visibility" which is actually zigzagging pretty close to a precipice?  Make sure all those stop losses are in there.

  BUT PLEASE follow our advice and dump those  US dollars for gold bars.!


THE REST OF THE YEAR ( for numerologists)
This sure has the feel of 1987 all over again... Stratospheric P/Es, rising rates and an ever shrinking pot to ...
In 1987, we sold everything in May, Took three months off in Greece ( of all places!), came back in September and hearing snickering remarks until that faithful day in October...  The years ending in Os don't' do very well... need I remind you 1930 ( great depression), 1980 (Iran Crisis, NY default,,, etc.), 2000 Tech bubble burst aftermath, isn't 2010 just a repeat with the inconvenience of  a bunch of  technocrats hell bent on trying to keep alive a patient with no quality of life ( or job for that matter).

BUT PLEASE follow our advice and dump those  US dollars for gold bars.! ( repeated for serious effect)

Meantime I am buying dinner to anyone who can call the low on US treasuries... been waiting so long I have dust  on my buy tickets... TBT and the likes!

Good trading to you