Soos Global Cap...'s  Instablog

Have a look at this piece that FactSet tweeted re Consumer Credit (they're named in the article).

Is this a good thing, consumer debt expansion? Normally one might say yes. But in this case, it might be a reflection of no longer being able to tap into the 'home equity' lines that were pretty easy to get pre-'08, and not much left in savings, therefore leading to a 'need' to borrow, not just a 'desire'! The expansion in student loans, too, looks a bit bubble-esque.

Anyway, no one cares about cerebral things like this right now, afterall….China eased….the Ben Bernanke will be talking this morning with the market expecting some hint at QE3 or the like, and Spain was able to auction off some debt this morning.

Question: Trust this bounce?

Answer: First consider some other questions: Are the monetary fixes the answers? Or are they nothing but liquidity provisions that help avoid a total chaotic shutdown of the financial system. Are the necessary fiscal adjustments, especially in Europe, but here in the US too, likely to be forthcoming? If not, are we then currently experiencing a 'buy on the rumor, sell on the news' event with regard to the monetary responses, which might be followed by market disappointment with fiscal policy responses?? Alternatively, could we get some form of FDIC in Europe or some form of Euro-wide-bond , which would be greeted enthusiastically by the market?

Either way, it might make sense to update the 'shopping list' of assets that have been bruised more than 10% since the selloff, and which might be good candidates for a rally on any sustainable bounce....or, if the bounce proves short-lived, which assets look ready 'for sale' at current levels.

You're welcome to visit our Public ChartList for a look at our 'radar screen' to see what we're considering on both fronts.

(Please note: This article is solely meant to be thought provoking and is not in any way meant to be personal investment advice. Each investor is obligated to opine and decide for themselves as to the appropriateness of anything said in this article to their unique financial profile, risk tolerances and portfolio goals).

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