The current US economy is in some trouble. Are we in a recession? I think yes. What are the issues? The dollar will continue to weaken given the current fiscal policy. When the fed lowers rates again - which it almost certainly will, we will see the dollar soften more.

Buy some TIPS - Treasury Inflation Protected Securities
Short the USD vs the JPY (japan)
Short USD vs CNY - (china)
Long VIX (buy volatility)

This is my basic view as to the best set of steps to take to position financially for the coming months. That said - I would still think that holding as much cash as possible would be the best move of all. Despite the fact that the USD will come under pressure, having some of those USD in the bank will help if things get rougher on the home front.

Credit will become increasingly expensive. The heads at Goldman and elsewhere on the street believe we are just seeing the 1/3 point in our road down the credit crunch highway. This means that credit conditions will continue to tighten - making $ expensive.

People holding pure consumer debt MUST get rid of it. The US Government MUST stop spending all of our money on a foreign war that we should not be in.

There is an interesting read over @ FT.com on Clinton vs Obama wrt free trade. I hope to see more of this type of talk as opposed to continued arguing, slandering, etc that seems to have come to the forefront of politics forever.

-Chris

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