Waiting For Godot

The S&P surged 1.45% overnight on the back of some more statistics that US seems to spew on a daily basis. For the factually inclined, Govt numbers showed that retail sales increased by 1.4% in October versus an expectation of a 0.9% growth. And yes the Fed did its bit. Bernanke said " that the headwinds of reduced bank lending and a weak labor market will restrain the pace of the US economic recovery warranting continued low borrowing costs" The retail numbers and this statement and off to the races went the S&P.

I have in the past kept talking about the Dollar carry trade and the rally in other asset classes. No point reiterating it. Commodities continued their rally. For a change, base metals rallied sharply yesterday while gold was relatively quiet.

I am long the Nifty. Am hoping that my mirror image story of yesterday works out. It would be really an incredible thing if we do that. I know. I can hear questions like "where are the fundamentals" "How can one justify those levels". Well for one I do not need to justify them. I am only a trader. And for another the great man Bernanke himself said yesterday “It is inherently extraordinarily difficult to know whether an asset’s price is in line with its fundamental value,”. Oh! great. And what about an entire industry which spends a lot of money attempting the same thing?

Finally a word on the Dollar again. I am the first to admit that I have been worried about an imminent and sharp Dollar rally catching me on the wrong foot. At the moment though, waiting for the Dollar to rally feels a little like "Waiting for Godot".