Sunday Evening Post: Halloween and Election Edition

Hello All,

Embedded here tonight are two reports: the typical S&P Update and also a look at Crude Oil (WTI). The S&P 500 continues it's uninteresting/grind higher as Mr. Market seems to have bears in a "sleeper hold." One can't shake the feeling that we're approaching some sort of important "inflection point" with:

a) The 2012 Midterm Elections;

b) Big Ben and the Funky Bunch announcing QE2 imminently;

c) Investor sentiment near all time highs;

d) This cover from Barrons (h/t Ritholtz):

Points a&b above seem to be fully discounted by the market which is expecting a Republican tidal wave in the House of Representatives and a huge amount (Trillion?) of Quantitative Easing. Anything other then those outcomes next week, will trigger a market correction. Given that these ideas are already being discounted, a "sell the news" outcome seems like a high probability. In other words, it's difficult to imagine a scenario where the market rallies hard this week. It would take something unexpected--like a Republican takeover of the Senate or a shockingly huge amount of QE2 in order keep this market rallying.

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Halloween Fun Fact from Wikipedia:

The word Halloween is first attested in the 16th century and represents a Scottish variant of the fuller All-Hallows-Even ("evening"), that is, the night before All Hallows Day. Up through the early 20th century,the spelling "Hallowe'en" was frequently used, eliding the "v" and shortening the word. Although the phrase All Hallows is found in Old English (ealra hālgena mæssedæg, mass-day of all saints), All-Hallows-Evenis itself not attested until 1556....

...The custom of wearing costumes and masks at Halloween goes back to Celtic traditions of attempting to copy the evil spirits or placate them, in Scotland for instance where the dead were impersonated by young men with masked, veiled or blackened faces, dressed in white.

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There are some things you just don't discuss in "polite company:" Politics and Religion. Fortunately, this is just a blog....

So, some thoughts on the upcoming elections and politics....

The "Tea Party Movement" has gained a lot of attention in this election cycle. The general theme upon which this 'movement' is centered is that:

a) our debt/deficits are too high;

b) government should be smaller;

c) taxes should be decreased;

d) nobody should be bailed out.

The rise of the "Tea Partiers" was a direct result of all the various bailouts and the Health Care "overhaul." It seems, at the core, most Americans are skeptical of big government and would rather not see anyone "bailed out." While I'm not a big fan of the various Tea Party "leaders," I'm happy to see Americans getting pissed off and heading to the polls--it's a good thing for our "democracy."

Unfortunately, the Tea Partiers have not "gone all they way" yet and come to the realization that their views are more closely aligned with the Libertarian Party than any other organized political party.

I'm a proud Libertarian. There's actually very few true Libertarians out there in the world, because most folks, when faced with very difficult circumstances, will inevitably look to the Government to "solve their problems." Most people who call themselves "libertarian," just say that to seem "centrist" or "non-ideological." (Please see Barry Ritholtz as an example.) For those who might think we're kooky or strange, I encourage you to peruse the LP Platform. I find it to be the most appealing and refreshing set of "ideals" out there. A few "snippets"....

On "Economic Freedom:"

Libertarians want all members of society to have abundant opportunities to achieve economic success. A free and competitive market allocates resources in the most efficient manner. Each person has the right to offer goods and services to others on the free market. The only proper role of government in the economic realm is to protect property rights, adjudicate disputes, and provide a legal framework in which voluntary trade is protected. All efforts by government to redistribute wealth, or to control or manage trade, are improper in a free society.

On "Personal Relationships:"

Sexual orientation, preference, gender, or gender identity should have no impact on the government's treatment of individuals, such as in current marriage, child custody, adoption, immigration or military service laws. Government does not have the authority to define, license or restrict personal relationships. Consenting adults should be free to choose their own sexual practices and personal relationships.

Which other political party would assert both of those common sense ideals of Freedom? This should be the last time I bring up politics in a Blog Post, until the next Election.

So, as they say in Chicago, vote early and vote often. Let the Games begin.

Market Update 31 October 10

Crude Oil 31 October 2010