I went short about two weeks ago when i discovered that producers have stopped hedging. They know something.

Another element that i’ve not heard discussed is that with with storage capacity utilization at a record level these producers sitting on mountains of stored NG (and massive recurring storage expenses) have more incentive than usual in seeing prices rise drastically. Considering that rig counts are dropping substantially it seems they are doing their part to get prices up.
Fracking is producing more than rigs now but this method has the political pressure as Vermont banning it this week shows.

I haven’t read EWI in ages. I find it clouds the brain!

I wouldn’t be so concerned about t-bills or even insured bank deposits. I’d keep some physical paper and metal safe somewhere, but that is prudent in any environment.

Sorry I’ve been so quiet lately. I’ll see if I can bring back the habit of writing publicly.

Best wishes,

Mike

Did you see Prechter’s recommendation to get out of bonds, notes, and bills and into cash and/or metals? I was wondering what you thought about bailing from T-bills at this time.

T-bills were supposed to be the last link to break, so I am surprised that Prechter is warning away from them so strongly at this time.

There are no good facilities I know of for cash storage in the United States. Does a hole in the ground still seem like a best bet if you must keep your cash in the USA.

Thanks

I believe the most prudent thing to do is to wait for the market to crack hard (5%+), then short the recovery, as most major tops are marked by several small drops and rallies. To be more aggressive, but willing to tolerate a few weeks of losses, it would be fine to short now, as this market will almost cerainly fall well below today’s level within several months. Sentiment is getting quite high (though this can be sustained for weeks), valuation is high, and we are overbought. If bonds fall in the coming weeks, it will be the final nail in the coffin for stocks.

BTW, Hussman does this work much better than I:
http://hussmanfunds.com/wmc/wmc120305.htm

Good point. For those of us who do not hold gold outside of the country those equities might be a preferred asset to hold, given the possibility of gold regulation in the US, which I cannot completely discount. However, do you think a year or so will be enough time to know which brokerages are going to remain solvent over the remaining course of the bear market? Any suggestions in that regard?