Fed rates

It is no surprise that the feds will cut the rate. The only question is by how much. If they take the lead from last weeks zero return for t-bills, then it will be 3/4 cut. I personally expect 1/2. They will want to have some left over for the next meeting.

At this time it does not matter much. They will most certainly go to zero before this is all through. Then what? The next great bubble? Treasuries?

Interesting read last night from a respected analyst (respected by me at least) if we are to work the numbers (I wont bore you with the analysis) the projected mean for this recession based on previous recessions that have been as severe, he is expecting a 500 S&P. That tells you the downside potential.

Now we will not go there over night and if this turmoil is anything like the '30's, we still have about 2 years of pain to go and another 20% or so of house prices to fall.

You will need to change your habits of buying on the dips we have done so long and start (or continue) to sell on the rallies.

You all should know my preference. Buy the long month puts and sell the short months. If we get large rallies, buy back the short month wait for the drop and then sell again. Either that or wait for the drop, get out of the entire position, wait for the run up and place the trade again.

For the bold...Buy puts. You will need to have some pepto on hand because the swings will make the most iron stomach wretch as we go down and come screaming back up again.