"If this guy owned a funeral parlor knowone would die. He is totally brain dead!"

GORDON GEKKO

I hope Barry goes into the funeral parlor business after his one term is over, just for the sake of all of us, but the above quote is really targeted at that dim wit who runs Congress. It also is just one of my favorite quotes of all time. I spit it out in a group of mixed company recently when they played a clip of her babbling on and doing her little torrets shake she seems to do at times. I brought the house down with the comment. How ironic, that she is bringing the house down by being such a dumb ass. I will get to how this relates to todays topic in a minute.

The above chart shows my current long position on GOLD that I have been holding for several days now. It is getting a little boost today by the stock market selloff. Alot of markets are moving out of sync from what they have been doing recently today, I am not sure what to make of it. The new normal would have had the EURO getting clobberred today and the DX up, and the reverse is happening. Also, on large down days GOLD has tended to decline, but today it is directly inversely moving to the SP 500. Go figure!!!

I had lunch with a good friend yesterday who runs a fairly large nutrition business. He was asking me what I thought of the economy since he is having a tough time getting a handle on how to run his business the next year or so. He is hesitant to invest in it for fear of a larger down turn, a position I think so many people are in. The following is what I told him.

Regardless of what happens this fall, the dems have dug us a hole that it will take a decade to fix, and it will get as deep as they can make it before the elections. As a result, it will not be a panacea even the the repubs take both the house and the senate. All that will do is create a stalemate. That would be better than nothing, because it will stop him from ruining this country for decades or possibly forever. However, it does not mean the economy will turn on a dime, it won't.

From an investment perspective it does not matter if you are a shorter term oriented trader like I am. All this talk is just noise. You cannot trade on news, because you just can't be fast enough nowadays. With the electronic markets, news is dessiminated into pricing in seconds, so chasing that is chasing your own tail. There are some very strong bullish cycles coming for stocks this fall as I have been talking about in here for awhile. They have me thinking about getting long in October, and I really don't care about the political back drop. I do not know a single good trader who trades of news, or off what he considers to be the next 6 months economic outlook. The government is manipulating numbers to such a large degree now anyway that it is almost impossible to get a true handle on what is really happening.

I love to take my shots at these pinheads just because I have a puny little forum here to do it, but I do not ever consider what they are doing when I actually make a trade. I might consider it when developing big picture views of what I think is likely to happen, but I do not put money behind it. I am not long GOLD in the above trade because I buy into the panic theory about the dollar and all that other hogwash put forth by paper champions ( economists ). All you have to do is listen to Mark Zandi on CNBC for 30 seconds to realize listening to economists is a bad idea. I am long because the trend is up, there was a brief pullback which gave an entry, then it resumed. Pretty simple logic.

Apply similar basic logic to the economy. The trend is down, wait for it to turn, then if you are so inclined, go with the new trend. It is not time yet to be long stocks or long the economy regardless of what side of the political fence you might stand on.