Kass: Olympic Sabre Rattling

During the middle of last week, I added to some of my favorite longs, including Lincoln National (LNC) , Prudential (PRU) and MetLife (MET) , which should benefit from the rising interest rate environment that I expect.

Late last week, as Mr. Market gapped higher, I added to some of my favorite shorts, including American Express (AXP) and Goldman Sachs (GS) , and hedged my long portfolio by shorting the SPDR S&P 500 ETF Trust (SPY) .

I start the day approximately 15% net short.

Lady In Waiting?

Monica (Courtney Cox): Well, Wendy's more of a ... professional waitress.
Rachel (Jennifer Aniston): Oh, I see. And I'm sort of maintaining my amateur status so that I can waitress in the Olympics.

-- "Friends," The One With the Stoned Guy (1995)

No one would ever say that trading and investing would be fun or easy, and the action over the past two weeks (a market without memory) only served to reemphasize that point.

Ifs, Ands & Butts

Question: If the monarchy suddenly disbanded, which song would you want played at your gold medal ceremony instead of the National Anthem?
Answer: "Baby Got Back" by Sir Mix-A-Lot.

-- Holly Lam-Moores, Team GB handball player on TimeOut.com (2012)

Reward vs. risk has deteriorated within the context of last week's ramp.

Err on the side of conservatism.

And go U.S.A.!