Today we hear from Ben “we’re not in a recession” Bernanke as he tries to walk and talk a fine line about interest rates, inflation (doesn’t exist) and the government’s plan for an exit strategy.
Tim Geithner is now “buying back” some of the rhetoric on the government’s exit, it was all the rage and the topic of conversation a few weeks ago, but just because some chosen banks are kicking back TARP doesn’t mean Uncle Sam will be doing the same anytime soon.
Bernanke has stated the recession will end later this year, but was completely unable to say the “R” word months back even though we were neck deep in one. So he was a little off, no biggie, he’s only the Chairman of the Federal Reserve.
Hard to believe that earnings for the second quarter will be released in a couple of weeks. Absent any other major news flow, this really could become the focus and set the mood for the balance of the summer.
It’s still a churning battle with the bulls and bears but for now, but at least short term, the baton may have been passed to the bears. The financials look heavy here, and I still think they are cripples going forward, when you mute the hype and the false promises they are still broken.
Below are charts of XLF and KRE, the later is the Regional Bank ETF that I am still personally short from the $19 area. The summer is here and the sun can get hot, so I’m looking for some SPF 7500 just in case.
