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Sept 21 2013 Weekend Market Comment

Sept 21 2013 – The  Federal Reserve had a wonderful opportunity to taper bond buying and start to take off the training wheels, the street was ready for it, the world expected it but nope nothing. If you followed me in to MVV you were elated if you followed me into you got nailed. In my case my bet on HGD was small and stopped out almost instantly.

Yes Pandora was the place to be I hope you backed up the truck like I did up over 5% in a week! Trim your positions here. 

But the truth is nothing has changed, we had a nasty pull back on Friday that made us all nervous. Trading volume was heavier than usual as Friday marked the event known as "quadruple witching," when stock index futures, stock index options, stock options and single stock futures all expire on the same day. Trading increases as investors replace or repurchase existing contracts.

In addition to the quadruple witching, all three major U.S. stock indexes, as well as the FTSE and U.S. index trackers, rebalanced their portfolios to match revisions to index weights. This happened at the close of trading, and helped push trading volume higher as transactions jump at the exact close.

If you wanted to play wait and see you would be wise, cash is a position too. However it appears that over all, gold is likely to be in a long term down trend and stocks look like they have no reason not to climb. That said - like I said last week, this is the most dangerous time of the year.


Terrorists stormed an affluent Nairobi shopping mall on Saturday, throwing grenades and firing machine guns, in a brutal attack that killed at least 22 people. The gunmen were not immediately identified, but the Somali militant group al Shabaab had previously threatened to strike the Westgate mall in retaliation for Kenyan attacks against al Qaeda.

Kenya now says it will be in Somalia for as long as it takes to obliterate the jihadists, years, if necessary, say the senior Kenyan brass. Things will escalate further if Kenyans launch their promised assault on Kismayo and the Shabab respond by using weapons allegedly flown in by Eritrea and with threatened major terrorist strikes in Nairobi and beyond.

Kenya has slipped from a showplace for Africa to a disaster mostly due to its fractured neighbour to the North. Unfortunately there looks to be little hope, the US is weary of Muslim interventions, Kenya has no oil and unlike Serbia this is not a European blood bath -- this is Africa.  This week's Economist magazine even has a feature on how the white house is specifically staying out of these conflicts.