Monday, November 24, 2008
TLT v. USD
The biggest bubble nobody wants to mention. Long Term Treasuries. This Weekly Chart to the left shows how investors are bailing out of the TLT and hoarding cash. This explains the demand for dollars and the reason the Treasury can't print enough of them. Don't be fooled by only looking at the TLT with a PE of over 24. The Moosecall for the week was to stay cash even though Bill Dirlams program showed a switch to Treasuries. Damn good thing Bill has some common sense to go along with his program. Don't forget he called for a big bounce in stocks only 1 week ago. In my opinion you all should read the DecisionMoose religiously. Now if you look only at the chart for the TLT it looks like this thing is in one hell of an uptrend. But once ratioed to the $USD it shows a different story. It has the appearance of the beginning of a downtrend. Now, if I had the option of buying a Treasury with a PE of 24, or a stock trading at a PE of 5 to 8 and a dividend yield of 3% to 8%, I think I'd chose the later. I'm sure this is prime time to rebalance if nothing else.
Now for some entertainment: HERE is a list of W's best buddies.
Thanks for stopping by and good luck with all your trades.
Subscribe to Posts [Atom]
Subscribe in a reader
