Bailout coming

Ignore the government right now. Paulson is speaking in both Wall Street and Washington gibberish. Bush said the mortgage giants are “very important institutions.” That's all I need to know. Despite its claims, this President is ot a conservative. He loves government interventions. Plus, he wants his party to win the next election. Bush is already being compared with Herbert Hoover and if he doesn't do something to try and save the housing market and the economy, they'll be linked as twins.

The Dow is under 11,000. Remember Dow 14,000? That's about where it was a year ago when I began this blog. The housing market is tumbling and might need another 25% shave in order to adjust to reasonable levels. Oil has hit yet another record high. The dollar is getting its ass handed to it. Unemployment is up.

Can we finally use the recession word?

The GE earnings release told me everything that I need to know about this economy. One of the best-run companies in the world which is a master of managing earnings, reached into it's hat and didn't pull out a rabbit. Earnings were flat.

Read this statement from CEO, Jeff Immelt:

"Led by double-digit segment profit growth in our industrial businesses and a strong relative performance in our financial services businesses, we delivered a solid quarter in a volatile environment," GE Chairman and CEO Jeff Immelt said.


"Many markets and industries remain healthy, while the U.S. economy is challenged," Immelt said. "Opportunities in emerging markets, infrastructure, commodities and global healthcare are creating demand for our businesses, while we fight through the difficulties of a burdened U.S. consumer, a tough housing market, inflation and volatile capital markets. Even with all this uncertainty, we still see growth opportunities ahead."

That's a nice summary of what's been working in the market and what hasn't. Simply put, if you live in an emerging market, then it's Everybody Wang Chung Tonight. If you live in the good ol' US of A, the song playing on your stereo is Drive by The Cars.

I think that Fannie and Freddie will rally on Monday. Some people with short this rally. I am not that brave. I am going to buy this bottom and wait for the cavalry.