Be Careful What You Wish For

That's a cliche one hears all the time, but has elements of truth especially for human psychology.

"Everyone" was looking/wishing for a 10% correction. Uh ... they got it last Thursday. From the charts, some real buyers really did put out big bids there and stocks rebounded heavily. One had to be an active trader to get those low prices, as the closing prices were quite off the lows that day. That's one advantage of ETFs over index mutual funds. I missed those intraday prices - I think I was at the farmer's market getting some good vegetables. Oh well ... I'm not afraid to buy anyway, but am waiting for more time to pass since my last big buy. Use time diversification!

"Everyone" was complaining about too much global liquidity. Uh ... that's long gone now. Europe is gasping for liquidity as its asset-backed commercial paper market is gutshot. From what I can tell, the conduits were not properly structured [I wrote about that some yesterday].

"Everyone" was griping about dollars flooding the world. Uh ... Europe has a dollar shortage now - its banks need dollars from the US to fund lines of credit.

Listen to me. The world is NOT ending. The world economic growth trajectory is intact. The US still has a trade deficit and is still sending dollars overseas to provide global liquidity and monetary base for the world money supply [I wrote about this concept a few months ago - see February 7, 2007 post]. So far, the government dolts have done OK - not great, just OK. They need to do more, but have shown signs of a willingness to do what's needed. I think Sen. Dodd's political pressure yesterday was a good move. Those ivory tower economists need a bitch slap of reality once in awhile. Congress has real power - if it gets motivated, it can really move fast and do things.

Use time diversification! It's a bull market. [uh ... unless the Fed fools stick another sword into it.]

If the global growth story is still intact - as I think it is - the oil & gas & miners have pulled way back. If you were waiting to get some of those, you might consider starting long term positions with a time diversification program of your own. BHP reported stellar earnings this AM - that's my largest miner position. My largest oil & gas is CVX. I own lots of stock in these groups, but do add bits & pieces here and there. I still think a 21st Century "Greater East and South Asia Co-Prosperity Zone" is forming and demand for oil and metals will grow for years to come.

PS: Mmmm this coffee tastes good. It's "Sumatra Mandheling" dark roast - pure and black - a man's drink ;-). Fresh hot "Joe" in the morning is a pleasure of life!