Sorry about not adding any comments yesterday. I was tied up with clients all day, and....I don't want to start sounding like a broken record. For those of you who have been following my comments, my opinions on the markets have not changed.

In order to bring you the best possible insights, sometimes when there is nothing to report, why report. In blogging, everyone is trying to attract eyeballs to their websites to sell advertising. This is not my objective.

A SELL:

We are going to sell Schlumberger (SLB) in the IA portfolio Monday. Our price target is $100, and its been hanging around the $95 level. That's close enough for me. A sale at $95 would put our gain somewhere around 30%.

THE MARKET:

Yesterday stocks put on a good, but boring performance. The S&P is pounding on the door of the 1250 resistance level, and may breakout soon. Once this happens, the financial press and the media will be yelling "buy, buy, buy", and if you do, could be saying "bye, bye, bye", to your hard earned money.

Since Christmas is right around the corner, its time to be "Making a list, and Checking it Twice". Not a list of gifts, or stocks to buy, but a list stocks to short.

The first place I will start is an easy one. Once the S&P 500 breaks above the 1250 mark, I will be dollar cost averaging into my favorite S&P 500 short, the Rydex Tempest 500 fund (RYTPX). Yes, for a while it will be painful if the S&P reaches the euphoric 1300-1350 level, but markets go down a lot faster than they go up. Once the markets start heading south, the declines will be very painful for the perma-bulls.

Let's be frank, no one likes a perma-bear, or a messenger of bad news. I am neither. In fact, I feel I am a messenger of good news, particularly if you can make money as the market is going down.

In addition to increasing my position in the Rydex Tempest fund, I will be making a list of short sale candidates. I hope you will too. Once I begin listing my ideas, I hope you will pass a few of your ideas along also.

As far as my personal allocation to stocks, I will reduce my holdings to 40%, then 30%, and maybe even 20%. The only stocks I will be interested in holding are in the consumer staples area, and maybe a few financials.

When the decline begins, it could last for 6-9 months. The sector rotation model tells us that financials and cyclicals should be accumulated during this period. After cyclicals, technology and industrials should be accumulated. Don't get to antsy however, we have a long way to go.

As the debt laden consumer goes on their final buying binge for Christmas, we will be preparing ourselves to profit for what is sure to be a tough 2006. So, when will the fireworks begin? My best guess is sometime between February and May. Yes, I know, we may have to wait 4 month's, but I'm sorry, I do not control the markets. So, who does control the markets? Here are a few quotes from some past US President's:

President Woodrow Wilson said...

鉄ince I entered politics, I have chiefly had men's views confided to me privately. Some of the biggest men in the United States-in fields of commerce and manufacturing-are afraid of somebody. They know that their is power somewhere so organized, so subtle, so watchful, so interlocked, so complete, so perverse, that they had better not speak of condemnation of it."

Franklin Roosevelt said in a letter... 鄭 financial element in the large centers has owned the government since the days of Andrew Jackson".