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[johngeorge]

http://www.billcara....ha_23.html#more

The problem today is that bullish traders fear that without central bank help the global equity market will revert to the long-term mean. The reality is that it's going to anyway -- based on other factors.

The European Central Bank and the Bank of England held interest rates steady this morning, as was expected. The ECB also injected $57.7 billion in unscheduled one-day funds, the fifth allotment in the past month.

So, all eyes this morning are on the monetary decisions and guidance of the European Central Bank and the Bank of England. Later in the day, traders will be hoping for a response from the US Federal Reserve Bank.

However, I have to ask, with respect to trading and portfolio management, is waiting for handouts any way to make decisions? Shouldn't we be looking at corporate financial structures and short-term liquidity issues, operating profitability and efficiency measures, trends in the growth rates of revenues, earnings, dividends and capital spending, and trends and cycles of share prices?

I mean is it ever a good thing that the central bankers have to open the discount window, or drop their benchmark lending rates. Is that not a sign a healthy economy is in decline, or at the very least easily broken, which will negatively affect the conditions within which corporations operate?

I think we ought to re-focus on the corporations and the shares we hold in our portfolios. Trying to figure out what central bankers may or may not do is a mugs game, like trying to pick absolute tops and bottoms of stock price cycles.

That stuff may be entertaining to some, but it is not the essence of trading and portfolio management, which I hope is what we are here to discuss.

If we want to talk seriously about entertainment, perhaps we should be considering the passing early today of the Maestro, Luciano Pavarotti.