OUR LONG/SHORT ALLOCATION MODEL REMAINS UNCHANGED
Today stock market broke out to new year to date high. All components of our model with the exception of three would dictate a more positive stance. Here are the three exceptions:
Recently US Stock Market has been remarkably correlated to US $; weaker the dollar, higher the stock market. Today as the sock market broke out to new highs, the dollar did not. This is setting up a serious divergence .
US money supply is not increasing, whereas money supply in the rest of the world is increasing sharply. This sets up conditions for a short term rally in US $.… Please click here or the title below to read more.
August 21, 2009