A recent report by University of Cambridge’s J.M. Coates states that the level of testosterone in a trader will affect his results. More is better up to a level when the trader becomes overconfident, and thus takes on way too risky bets. I doubt my testosterone level is very high when I get up 2:30am to prepare for trading, and will use that as an excuse if needed.
As I’m fascinated by debt, I’d like to add two more data points to yesterday’s post.
§ The average US consumer now owes $16,640 in non-mortgage debt, up 8% from a year ago, which is more than double the increase in wages. Guess those credit cards aren’t so loaded anymore.
§ Private sector debt has now surged to 350% of private sector GDP.
And then a bonus for those of you that think the FED should keep cutting rates, and that inflation is nothing to worry about.
§ Consumer demand, in real terms, for energy goods and services has contracted 3.7% over the last year. From what I hear, SUV inventory is growing and carpooling is absolutely on the table.
For today’s trading I followed my own advice from yesterday, and acted on the PPI announcement. It came in very hot, 1.1% (MoM), but the market seemed to look the other way, and I took a long position. I was pretty deep in the money at one point but chose to hold on, and as the US market ended in positive territory, and Intel came in as expected, I’m certain I won’t regret it tomorrow morning. My strategy for tomorrow is to close during the first hour, and then wait for the CPI (14:30) for my next move. It may change as the day plays out, but I can almost promise you that all my positions will be closed before the bell.
Btw: Does anyone know if we have any new ETFs for OMX in the making?