Testing 2,040 on the S&P. 

That’s what we’re doing while oil is at $74.50, copper is $3, and gasoline is $2.  The Eurozone’s GDP was out this morning and Germany’s GDP is up 0.1%, avoiding Recession by a whopping 0.2% and France has pulled into the lead, up 0.3%, less than 1/10th of the US growth trend.  Forecasts going forward are for the whole Eurozone to grow 0.1% in Q4 – the smallest miss puts them back into Recession.  

The euro area’s fragile “recovery” has been in peril since economic malaise took hold of countries in the region’s core. With the revival stuttering and inflation close to the lowest level in five years, the European Central Bank has deployed unprecedented stimulus and urged governments to invest and deliver structural reforms to support growth.

Italian GDP fell 0.1% in the three months, marking the 13th consecutive quarter in which the Euro region’s 3rd-largest economy failed to grow. The Bank of Italy said yesterday that the country needs to avoid a “recessionary demand spiral” due to the “persistence of economic difficulties, which have been exceptional in terms of duration and depth.”

Meanwhile, the Euro is down 11% since May, now just $1.24 buys you one and you get 116 Yen for a Dollar, which is why our Dollar index is now popping 88 and putting massive pressure on commodities, which are also suffering from weak demand.  This, of course, is collapsing Russia’s commodity-based economy (along with the sanctions), with the entire Russian Stock Market’s value falling below that of just Apple, Inc.  

Tempting though it may be, we’re not shorting the US markets while the rest of the World is swirling down the drain.  Shorting US equities has been a suicide play for the past 5 years.  Of course we have our bearish hedges but our main hedge is CASH!!! going into the holidays.  Let Santa have his rally – we’re out!  

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