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Well we had lots of fun looking at how we COULD get a soft landing but there are still a lot of bridges to cross, and one major toll coming up is cancellations.

Cancellations of pending home orders caused the last 3 housing reports to be adjusted downward with an implied margin of error of 15% or more. That means that what has been reported as a 17% drop in new home sales this may end up being a 30% drop in new home sales next month. Of course, it may also be a 2% drop but, really, which do you think is more likely?

Don’t even read this if you’re trying to be bullish -- Biodeiselchris points out that David Walker, the U.S. Comptroller, considers the economy such a crisis that he is getting a bunch of economists together to go on tour so they can explain it to the American people who, when asked, consistently fail to rank our $8,500,000,000,0000 deficit as one of the top 10 problems facing our nation.

If you think you had a tough year, check out Vega Asset Management’s performance bad enough to warrant a letter of apology [pdf] from the Mega Hedge Fund.

Lowe's Companies Inc. (NYSE:LOW) is one of the few calls I kept (because it was so bad it wasn’t worth selling!) with the Nov $32.50s down at a dime (down 75%). Earnings are not until the 20th, but Cramer just jumped on board, so, if the market isn’t dying on us I will add to that position but with the December $32.50s at .45, giving it more room to run.

Cramer also agrees with me that Yahoo! Inc. (NASDAQ:YHOO) is indeed too cheap to stay at this level and represents a takeover opportunity for a big media company. Amazingly our Jan $27.50s are back to $1 (up 20%) already as the initial play in which we sold the calls worked out just right! The Jan ’08 $25s are now back even at $4.80 (double-down 10/19), but those we have time for!

Check out Nick Perry's article on the week in the ETF world -- really wasn't that bad in retrospect...

Have a good weekend,

- Phil

Read all of Phil Davis's articles on Seeking Alpha.

Source: Options Trader: Weekend Ideas