Last Chance to Place Your Bets

Debating this weekend’s Yankee - Red Sox series today might be time well spent, as it it getting a little late to re-position yourself before next week’s news flow.

The news is dire again today, and it might be months until it improves dramatically.  This week did not provide many answers, and today’s retail sales numbers are certainly nothing to get excited about:

Retail sales in the U.S. rose less than forecast in August, adding to the case for an interest-rate cut by the Federal Reserve next week.

The 0.3 percent increase followed a revised 0.5 percent gain in July that was larger than previously estimated, the Commerce Department said today in Washington.....``The consumer is pulling back a bit,’’ said Peter Kretzmer, a senior economist at Banc of America Securities LLC in New York. ``Maybe some of the issues in financial markets and housing are starting to limit the upside’’ in spending. Bloomberg

Technology stocks are in the woodshed today, and soon you might read about how popular and crowded the tech trade has become. Bears have their last chance to press the bets and bare their teeth ahead of the Fed’s move next week, but we still think the tough trade is taking the opposite side. Perhaps there will be some good news to sell into in 2008.

Hoping that the U.S. will benefit from strong Asian growth might be a pipe dream, but can the rest of the world decouple from our woes? A debate is raging over the issue, but we might be another business cycle away from letting the suckers of the hook.

Decoupling, the notion that the rest of the world can weather the effects of a slowing U.S. economy, had all the attributes of a successful advertising campaign. The message was simple, clear and succinct.

One problem: It doesn’t fly, or at least not yet. It might even be argued that the powerful forces of globalization make decoupling impossible. Bloomberg

Decoupling might be farfetched, but you can always unplug for the weekend. From financial news, not sports. There are too many good games on this weekend. Being American is not all bad, now is it?

U.S. Retail Sales Rise Less Than Forecast in August
Bloomberg

Decoupling Is a Nice Theory That Won’t Fly
Bloomberg
-----------------------------------------------------------------------------------------------------------------------
The content contained represent the opinions of 1440 Wall Street. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author. No positions

Comments:

<< Back to main