After a weak open, the market treaded water all day before being greatly disappointed when President Obama had nothing new to offer in his meeting with Congressional leaders. The futures are being slammed after hours as market players are giving up on the idea of any last minute fiscal-cliff deal. We don't have any specific details, but it doesn't sound like there are any new ideas and there is obvious concern for a big, ugly open Monday morning.
What is particularly frustrating about this market is that nothing other than the fiscal cliff matters. Stock picking doesn't matter when all movement is a function of the next headline. We haven't even had the usual end-of-the-year window dressing and manipulation to complain about.
Unfortunately, there's no great strategy for dealing with a market handcuffed in this manner. Either you try to bet on the next piece of news, which is little more than a coin flip, or stay patient and wait for clarity. I can't remember when we have been so handcuffed by a political event for so long, and it is causing great frustration among active market players.
The last trading day of the year on Monday is going to be particularly tricky. We'll know for sure whether we are going over the cliff or not, and I'm sure there will be funds trying to do a little last minute positioning.
Have a great weekend. I'll see you Monday.
