We ended down 65 points and that is flat. Not a shock at all. The market is waiting for the FOMC announcement tomorrow, Goldman Sachs quarterly report tomorrow and everyone wants to know what the White House is going to do with the bankrupt 3 and the TARP money. I find days like today boring and not worth reading anything into. The volume was extremely low. We did have a couple interesting stories (on the blog) but nothing that will move the market.
Goldman Sachs quarterly report will be very closely watched by the market. The analyst are expect Goldman Sachs to report their first loss ever. The question will be how bad will it be. Based on what Jamie Dimon, JP Morgan CEO, said it could be really bad. It will take a lot to shock this market right now. If it is inline, the market will rally. If it is really bad, the market will sell off. I can't wait to see their report and hear the conference call.
The market is expecting the Fed to cut the interest rate 50 BPS. I will be surprised if that doesn't happen. The market has baked in a 50 BPS rate cut (the cut will do nothing since we are in deflation) but the market likes to get rate cuts. The real news will be in the report after the announcement. The market will be listening for clues or down right say that the Fed is going to use Quantitative easing (in other words print money out of thin air and buy Treasuries). This would be a big move and kill the dollar. Let's see what they do.
I wouldn't expect much until the Fed announcement in the middle of the day. Stay short!!
This is my last email. Please start going to the blog for these reports. www.moneytalktoday.com
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