Weekly Commentary - Feb. 28,2010

Wow...Canada wins the gold in hockey...never would have saw that coming. Let's see what this week brings. Major event for the week obviously still remains...the Greeks. Rumors are swirling like mad. But ultimately Greece will have to resort to major budget cuts which ultimately even if agreed to will lead to increased civil unrest. The President of Greece resorted to calling the Germans a bunch of Nazi's and said that they never gave back the gold that they stole during WW2. Yeah, good one...insult the very people you need to bail you out. Might be absolute coincidence but after that was said the Greek President will be meeting with Barack on Mar. 9. So the future is still unclear, however the Euro is getting very oversold and if the bailout news hits the euro will catch many people short and fly. Longer term prospects for Europe remain...Spain, Portugal, Italy...it just gets worse and worse. Dollar target remains - 90. And as far as all the people saying that the sovereign debt crisis of Greece is contained...I am having flashbacks to the whole sub prime crisis, where everyone was saying it was contained...including Bear Stearn's...saying it would not effect us. A year later they were bankrupt. I remember this vividly because I said that they would be the only firm I would work for...well that plan went to hell. In any event, watch out for the beginning of the month buy programs kick in, in addition to the usual Monday Market Levitation. A rally back above 10450...might very well be in the cards. A failure at this level confirms the top in the markets on a weekly and monthly charts. If the Greek tragedy continues the markets will not be able to take it...and will falter fairly quickly. Beware the Ides of March. Gold looks like it might be forming a nice little down channel from 1125-1025. Definitely trade-able as it awaits the break below 1000 on its way to sub 800. The most important thing right now is to be extremely flexible as short term volatility is sure to increase several times over in the next few weeks. I'm still trying to figure out how the economy is going to get back to normal anytime soon, when by the governments own optimistic estimates, unemployment will not get back to 5% until 2016. Update: Doesn't look good for the Greeks. http://news.smh.com.au/breaking-news-world/no-german-rescue-plan-for-debtridden-greece-20100301-pbj7.html