Accentuate the Positive

In bull markets participants discount the negative and put a premium on positive news. In bear markets participants do the opposite. I have long positions and have profited greatly but I still doubt this rally. It is hard to know when you are being patient or stubborn as I cover my short positions. On Friday, my assessment was given a sound thrashing. The Commerce Department reported second quarter GDP fell by ONLY 1.0%. This news gave investors cheer as they pushed up stocks. However, the better than expected results was from the Federal Reserve holding down rates and the Obama administration spending. The spending is not indefinite, the government must pay back the debt and holding rates down for so long creates its own problems. Again this might be my stubbornness so take my assessment with a grain of salt.