Food for thought

Obama. Inauguration. Done. Can we now move on? From what I’ve been reading, Geithner is a done deal. Now what?

I can’t help but feel that at some point soon, we will hit apathy. Apathy is perhaps the most difficult mentality to trade in. Sometimes volatile, sometimes not. Little predictive value in logic, as people just won’t care. Up, down, sideways, rangebound, bull, bear…investors won’t care one way or the other any more. Those who sold are out and probably won’t look to get back in soon. Those who are in, are in and probably won’t be looking to get out too soon (unless the have to). So day traders will trade between themselves. We’ll hopefully start seeing some strategic M&A, which hasn’t been around for a while as PE got in the way. And we’ll start rebuilding a base. Why do I think we’ll hit it soon? Well, I’m looking at Citi (C). It’s at $3+. It’s market cap is around the same as Yahoo and less than GOOG, AAPL, or RIMM. I have to assume that if things were going to continue getting worse, fewer people will get iPods or sign up for Blackberry service. So who is selling C? At some point those sellers will be gone and I assume that the day will come soon. Not that I think you should go out and buy C. For all I know, the government might step in and change the rules on us. The only thing I’m saying is that I just don’t see the same type of risk as investing in C at $29. Reversion to the mean works both ways, so I assume we are getting closer to apathy. Not time to buy, but maybe not time to sell anymore either.

Last 5 posts by Yaron Sadan

• That sinking feeling - May 18th, 2012
• Opportunity on the horizon - May 18th, 2012
• Early can hurt - May 16th, 2012
• Diversify your Diversification - May 15th, 2012
• Losing Money Isn't a Crime - May 15th, 2012

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