Barry Ritholtz: Don’t Fight the Fed

Barry Ritholtz: Stick With “What’s Working” and Don’t Fight the Fed

Posted Oct 15, 2010 07:30am EDT by Aaron Task in Investing

“You can’t be short a market where the Fed is saying ‘we’ll do whatever it takes to hold up every asset class,'” Barry Ritholtz, CEO of Fusion IQ and author of Bailout Nation says in the accompanying clip, taped ahead of Ben Bernanke’s Friday morning speech.

But not being short is different than being aggressively long. After moving to 100% cash in May right before the ‘flash crash’, Ritholtz is currently “half-in, half-out” of the market: Fusion IQ is currently sitting on about 45% cash and “slowly adding to long positions.”

“This market has had repeated opportunities to roll over, to fall on bad news, to follow other bourses lower, or to take a modest sell off…and turn it into something more dangerous,” he writes. “In just about every case, Mr. Market has refused to cooperate with the bears.”

To all the “Fed watchers, politicos, policy experts and amateur economic wonks,” Ritholtz asks a simple (yet profound) question: Do you want to be right, or do you want to make money?

Full article HERE

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