Reasonable Short?

I heard an interesting point yesterday. Pull a 3 year chart of the XRT, which is one of the retailer ETF's (exchange traded funds).

http://www.google.com/finance?client=ob&q=NYSE:XRT

Does it make sense that a basket of retailers would be trading in the market at roughly the same level as before things cliffed last September? For several reasons I would argue no, but I'd be curious to hear your thoughts.

The components of the XRT can be found here:

https://www.spdrs.com/product/fund.seam?ticker=xrt

-2outof4

Would Shorter Political Terms Change "Short-Termism?"

Einhorn shorts U.S. 'short-term thinking' - NY Post reports David Einhorn is bullish on gold because he's bearish on Obama. Members of President Obama's prized economic team, including Treasury Secretary Tim Geithner, are "quintessential short-term decision makers," Einhorn said, explaining his sudden fondness for gold. Watching Geithner, Federal Reserve Chairman Ben Bernanke and White House economic advisor Larry Summers on television recently, "my instinct was to short the dollar," Einhorn joked at the Value Investing Congress. Instead, he decided to invest in gold, even though futures hit a record price of $1,072 an ounce last week. Gold does well when "monetary and fiscal policies go awry," said the hedge-fund manager best known for shorting toppled investment bank Lehman Brothers. Specifically, Einhorn trashed the team's "too-big-to-fail" policy requiring taxpayers to prop up large, troubled institutions, like banks. "Our authorities have taken the view that kids will be kids," he said, comparing the officials to the parents of teenagers who know they will be rescued any time they get caught. He suggested public officials break up large financial institutions that appear on the brink of collapse rather than bail them out. Einhorn also said Geithner's regulatory reform plan was akin to efforts to stop terrorism by "frisking grandma and taking away everyone's shampoo." He scoffed at the idea that the government might try to regulate complex financial instruments like credit default swaps, believing they should be wiped out. He said regulating the swaps is like "trying to make asbestos safer."

On a side note, Mr. Einhorn has made a couple of 2outof4 appearances now!

-2outof4

Thanks Barney

Where is our financial education?

The myth of the perpetually rising home price lives on:

http://www.businessinsider.com/20-year-old-buys-home-with-183000-fha-loan-and-just-35-down-2009-10

This girl's efforts could be directed so much more sensibly!

-2outof4

No More Overseas Vacations

The funk that I've been in and part of the reason there have been fewer posts recently is partially a result of politicians' attempt to reflate American assets by deflating the currency, and the lack of political will to reverse the trend.

At this rate, the US Dollar (USD) is going to lose its position as the currency of trade.

http://www.independent.co.uk/news/business/news/the-demise-of-the-dollar-1798175.html

So what you say? This is what:

http://online.wsj.com/article/SB10001424052748703298004574458923186941870.html

I sat in a meeting today where a respected Wall Street strategist said the only way out of the current economic situation is to inflate assets. I think that is a horrible idea. As has been stated here many times, we need to work our way out of it and not try to legislate out of it.

Seeing crap like this, at the 9:55 mark, boils my blood and frankly depresses me:

http://abcnews.go.com/Video/playerIndex?id=8746931

As usual, free money will be spent - it has a tendency to do that! But it is not in the long-term interest of Americans or the USD. I'm beginning to wonder if either party cares.

-2outof4

My Beer Gut is Not Your Problem!

I ate one of the best cheesesteaks of my life last night complete with onion rings and ice cream. If I have a heart attack this afternoon, do you think Mrs. 2outof4 is going to sue my local cheesesteak joint?

Nancy Pelosi and Co. need to heed Mr. Kent's advice. Get your kids off the couch and back to more active lifestyles. Americans need to take responsibiltiy for their health without looking for scapegoats, and once again choosing market winners.

http://online.wsj.com/article/SB20001424052748703298004574455464120581696.html

Two maintenance guys got on my office elevator this morning and when they got of one floor later, one said to the rest of us, "I bet you hate the guys that only ride one floor." I don't them at all, I just think they are extremely lazy. Maybe if they took the stairs a couple of times daily, they could enjoy that tasty Coke!

-2outof4