Tuesday, January 15, 2008
Volatility! Who wins?
Gone are the days when a hundred point swing in the market was news worthy. Today, the DOW dropped 277 points ending the day at 12,501 following yesterdays rally of over 100 points and nobody flinched. Normally this volatility is great for the brokerage companies due to higher trading volume (brokerage fees), but with the credit markets dragging everything down the financials are not even going to prosper from this increased volatility. If I had time to follow the tape I would be shorting into this recession, but instead I am heavy in cash and sitting on the sideline in search of some good investment opportunities. Recession noise is still very loud, but when the recovery talk starts I will plunge back in. Stay optimistic!