Financial Pundit?

Though I thought I wrote about making a move in the stock market, it appears that I did not. Or at least I couldn't find it. It would have been back in November though. Anyway, at that time, I sold some of my stock mutual funds and moved into bonds (moving down to 65-70% stocks). My reasoning was two-fold: 1) the stock market was at 10,600 and I had no reason why given the bad news in the economy. 2) One of the funds I was selling the most of was up 50+%. So how did that turn out for ol'Joe? The Dow dropped to 10,000 and then jumped 10% to 11,000 over the first quarter. The fund I sold was up 6.5%.

Back in January, a stock I was holding, Fastenal (FAST), had run up to $46 a share and had a short ratio of over 20. That means a lot of people were betting that the stock was going to go down. Usually a stock would have a short ratio of 1-7, depending on the amount of news about it, so 20 seemed crazy! So I sold the stock and it dropped to $40 and I looked smart. Then it started climbing again and the short interest backed off to a more reasonable multiple of 10 times the average daily trading volume. Now the stock is north of $53 and again the short ratio is over 20. Their first quarter earnings were up 15% and thus Joe has failed again!!

So next time you call me or email me for financial advice, consider the source!