I have 43% in cash. I'm looking to see what other shoes start to fall. The credit crisis is still unfolding, and all we've had are tactical, not strategic solutions. High interest rates didn't cause this credit crisis, so why should interest rate cuts solve it? Congress is hoping the stimulus will help kick start the economy, but single-event tax cuts have been shown to be highly ineffectual.
Several retailers with strong balance sheets have gotten hit pretty hard. Foot Locker (FL) is down in the $10 range, and Jo-Ann Stores (JAS) got down to $9 from about $25. Under normal circumstances, they'd be buys. But I don't believe we're in a normal environment. I want to see more pain and suffering before I think it's safe to start buying in a big way.
Last updated February 06 2008: 10:16 AM ET