The euro dropped from its elevated state in the immediate aftermath of the Cyprus crisis, much as the newest blogger to iBC, Kong, anticipated it would. I am maintaining my EUO position though, for the moment to see if the euro will re-collapse around the 1.30 price level.
My immediate gut reaction is that the Cyprus move has sewn black seeds that will sprout at unanticipated times. If we get a summer selloff, either on disappointing data misses from the economists, or else a sudden blowout in European debt; in either case the consequences could get out of hand quickly.
Oil continues to blow out, also. I believe this move will be exacerbated, but especially so if Europe continues to appear all set. It’s my impression that oil prices surged into the Cyprus bailout because Europeans were using the black gold as a liquid market to transfer funding out. Couple that with disappointing economic data and an oil boom in the US and oil has $80 written all over it. SCO is my method of tapping into this trade.
Cash levels remain high, and so far I’ve only nibbled on some RGR.
AEC and CLP are performing very well, remaining in powerful rallies. That trade is coming to fruition.
Everything else I own is sucking wind, and I’m glad I’ve had the hedges to counteract that.
Let’s get some blood now.
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Guns or butter?
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I demand both, thanks to credit
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