What I'm Watching Out For

I think that I will have several opportunities come out of this current situation.

First of all, the temporary dollar weakness that is resulting from the giant bailout proposal has given me a golden opportunity to load up on some more bonds. I did buy back in halfway much too soon. However, as Merrill's Rosenberg says, the bond selloff after RTC was announced was a "great buying opportunity." I'm going to wait a little until after it's passed.

Secondly, as the economic numbers continue to show increasing global weakness, I need to short commodities. So, I am keeping my eyes open for any nice bounces in commodities. Oil, for one, is back up to $107.

One last thing: tech. It's held up too well. Tech has gotten a huge chunk of their profits from overseas due to global growth and dollar weakness. Now there's global recession and dollar strength. Tech is also the most overpriced sector, even more perhaps than commodities. The problem with tech, however, is that I don't know the sector, so I would need to short an index.

And one last thing. I'm going to look up the "frontier" markets ETF as a possible short. Frontier markets is just what it sounds like: the wild west in the early 1800's. Bloodthirsty natives, bandits, and natural resources to fight over. Only problem is they may be down too much, but being at the bottom of the pile, they'll probably never be down too much.