May 4 edition

Good Morning All,

Commentary

Just pretend for a moment that you had been taking a vacation on the proverbial planet of choice these past ten years, and upon returning you opened the Wall Street Journal and tuned in your new flat screen TV to CNBC or the Fox News Network. Wow, you would have to think....what kind of moron is this Obama guy. In just a little over 100 days he has not only destroyed the world economy, he has set about persecuting hard working, innocent, underpaid BANKERS and fully competent auto executives. Worse still, he is running up huge deficits and blaming the previous administration for his "inherited" problems. And soon he might even convene an investigative committee on the conduct of something called "the war on terror".

I am aware that most of the people who bother to read this letter are not members of the extreme right, although some of you poor souls may remain Republican apologists; nor would I suspect that many of you subscribe to the absurdities of libertarianism, an ideology that ranks behind anarchism in my less than humble view. With this in mind, let us appreciate the dilemma that faces those who must wield power within America and upon the international stage. Let us also understand that it will not be failed ideology (oxymoron) that will provide new and vital solutions to this unique situation...but a pragmatic application of high intellect and good judgement.

Markets

There is no such thing as a single market bottom. Techs and Agri stocks had theirs way back in November, whereas mines, oils, banks, materials and other sectors appear to have found depth at various times during the first quarter of this year. Indexes, on the other hand, seem to have put it all together on March 9th, the point from which our now eight week old rally began.

So as we enter week nine and the month of May, it might be wise to retrieve caution from the wind. There remains a strong likelihood that Friday's close above 875 on the S&P 500 could lead to a fast acceleration toward 950 before Thursday's "bank stress announcement", but a STRAIGHT run to my summer target between 1050 and 1150 seems less probable. Discipline suggests a few weeks of "go away in May" declines should take hold late this week or early next. Low volumes are fast becoming an issue and require monitoring.

"Life and ink, they run out at the same time, or so said my old friend the squid" Jimmy Buffett