February 23, 2009

Good Morning All,

Well the bad news, at least for me, is that my most recent letter which called for a market rally last week, not only fell on deaf ears but on fully plugged ones. The good news is that although some stocks may go to zero, the market itself will not, and as indexes fall to lower levels it becomes increasingly clear that we cannot continue the descent at present rates for seven more weeks. So as we begin the second month of the "fix it" Presidency we can look for a relief rally of some sort, the sustainability of which will be dependent on the reception given the Obama budget and the quasi nationalization of CitiGroup and Bank of America.

I am still in southern Florida where the class system of America is as visual as it gets. Interestingly though, it appears that the gap between the super wealthy and the much larger group, which is quickly beginning to include almost everyone else and is growing wider by the day, may not include attitude...fear and anger have been mutualized. The sense of hope that was ignited by the Obama victory has been somewhat mitigated by the attack dogs on the right who appear to control the business networks, Fox news and talk radio. It will be a sad day for us all if we lose the print media one day down the road where someone may well rant, but they can not scream.

The President, through all this, has remained calm, adult, personable and patient. His fault lies, in my opinion, in trying too hard in his quest to broaden the tent by appealing to his opponents' better instincts....my advice, stop, because as Gertrude Stein famously said about Oakland; "there is no there, there".

This niceness may of course be part of a grander plan, the one in which our Machiavellian Prince Barack practices the art of bait and switch, by giving them enough rope from which they may collectively swing.

It is necessary at this time, for Obama to show strong and unyielding leadership, leadership that purveys a sense of hope and a promise of renewal. He is more than capable of so doing and this crucial week is likely to bring new impetus to the great plan; or as I prefer to call it...the renaissance.

Meanwhile, even my late November, early December selections took a drubbing and although most remain somewhat higher than their outset prices, they are significantly below their peak prices....opportunity knocks.