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Hitting The Eephus Pitch

|Includes:SPDR S&P 500 Trust ETF (SPY)

As a Red Sox fan, I learned about the "eephus blooper" when Bill "Space Man" Lee used it. The eephus pitch is a long, high, excruciatingly slow junk ball that is particularly effective against power hitters.

There are a number of amusing anecdotes involving the pitch, including the 1946 All Star game when Rip Sewell, who perfected it, embarrassed Ted Williams, who asked for another chance. Sewell obliged, and Williams stepped forward into the ball (leaving the batter's box) and hit it out of the park. The umpire missed the call, although Williams later confessed to being out of the box.

Here's a link to a good article on the topic.

Investment Implications

Some, most notably Nouriel Roubini, see the turmoil in Europe, and the resulting decline in the US markets, as a slow motion train wreck. I see an eephus pitch.

This could be a long slow process, waiting for the ball to come down over the plate. Some hitters swing multiple times, and miss. Some swing so hard they fall to the ground, while missing the ball. Logically, it shouldn't be much harder than hitting a slow pitch softball.

The ball is drifting slowly toward the plate...

Disclosure: I am long SPY.

Stocks: SPY