Although we began yesterday long some QQQ puts and intending to hold them till Armageddon, we had second thoughts when sellers lost heart early in the session. The Dow was down 200 points at the time, but the blue chip average was clearly struggling to fall any further. After exiting the puts for a modest profit, we went back to spectating. In retrospect, the only place where the world seemed to be ending was in Southern California, where wildfires were devouring high-end homes by the hundreds and forcing the biggest evacuation in the state's history. On the statistical front, there were hints of Armageddon, including an 8 percent drop in existing-home sales that doubled the dartboard estimates of alleged economists. But Wall Street hasn't paid much attention to such discouragements in recent years, and no one should have been surprised when investors imbibed this latest dose of statistical arsenic with no ill effects. And why not, since, as long as numbers like these keep flowing from the housing sector, the Fed will continue to do what it does best ' i.e., loosen like there's no tomorrow. So grim have the numbers been lately that the smart money is betting on a 100 percent chance of a cut in the federal funds rate next week. Evidently, the only question at the moment is whether the cut will be 25 basis points or 50. Either number will suit gold bugs just fine, since it's not going to take much more profligacy to push bulllion quotes past $800 for the first time since the late 1970s. It's been even longer than that since the Dollar Index went groping for bottom below 80, but U.S. investors seem inured to the insult of it by now. How else to explain a Dow Average that lies within 3.5%
LATEST TRADES
