A year and a half ago I suggested that it was a great time to buy into the stock market as equities were making new lows. But I did suggest that I wanted to be out of the market by the end of 2010 as the stimulus started to run out and as corporate earnings peaked.
I have suggested that for at least the next 5 years there will be no long term gains in the stock market but there could be monumental short term volatility. In my post Snap Trading I suggested how I will manage my retirement account and my Virtual House Equity.
The market is getting close to the peak earnings so this current rally seems to be a good opportunity to sell my snap trading gains of the last few months and move to a market neutral position.
I have been selling my equity investments and I am buying into ETFs: FXP, PST, SRS, SH and VXX.
I am almost market neutral. If the market goes up I will happily trade into a small short position to weather the economic storms ahead.
Today the stock, housing and bond markets are more dysfunctional and volatile than anytime in history thanks to monumentally bad government policy.
Anyone 100% long in any of these markets is a fool.