Weekly ETF Rewind: Another Historic Policy Week

click to enlarge

(Glossary)

Another historic policy week left the S&P 500 down just a fraction after the Federal Reserve cut its key lending rates to all time targeted lows of 0% to 1/4% (SPY -0.1%). This move had the effect of putting strong additional pressure on the U.S. Dollar, leaving Bonds at bubbly highs even as Crude Oil fell to an incredible $33/BBL, nearly 80% off its summertime peak. (Bloomberg - Dollar Touches Lows on Cuts)

Also impacting the week was Friday's ultimate resolution to the $17.4B intermediate Auto-bailout package, sending Big-Three stocks soaring back from fears related to structured bankruptcy negotiation tactics espoused by the White House just a day earlier. (CBS - Mixed Views)

Week 52 is holiday shortened, but nonetheless contains the final Deflator and GDP readings, Home data, and Personal Income measures among others, as follows:

• Yahoo! - U.S. Economic Calendar
• Yahoo! - U.S. Earnings Calendar

I am a bit concerned over just how quickly the VIX (implied options volatility) has fallen given its mean-reverting tendencies, but this is moderated to a degree by the advent of the holidays and the more immediate implications of this week's policy announcements.

click to enlarge

Enjoy your weekend and have a warm holiday season!

Comments

[Prudent Man...:]

But no one mentioned that no American military died in action in Iraq. But, we did lose the Free Enterprise System to greed Capitalists and Congress, who will get their share of pork and illegal contributions.

Soros and Buffet, both of whom have lost a bundle, should be happy for their twofer for their illegal political contributions: An Obama Presidency with a Hillary Administration. If that is a lethal mix.

They will probably bring back to Military Draft in order to meet their increase in troops in Afghanistan because no one would volunteer to be in an Obama/Hillary military.

In this entire country we can't find a Law Enforcement Officer with white crime experience, either FBI, Secret Service, DIA, etc., and forensic accounting knowledge to head the SEC? The politicians don't want anyone knowledgeable with integrity to take that job. And if Obama, that leader who stated "the economy will get worse", shows us anything he is nothing but a Chicago political hack.

2008 Dec 21 12:14 PM

[pockyclips ...:]

First the commies, now us. As Darth would say, "our conversion to the dark side is nearly complete".

2008 Dec 21 12:21 PM