We've Seen Our Bottom

Let me offer a few thoughts before we all cut out of here for the long weekend. The January intraday lows of 1270 on the S&P and 11,600 on the Dow look like a stable base, having been tested and retested. The S&P is trading some 55 points above that level and the Dow is almost 800 points to the good (with still some time left to trade today.)

The Fed's actions led to this happy resolve. I think beyond the action to lower rates was the spreading conviction that the Fed is concerned about inflation, and sometimes a small change in perception is all that is needed.

Look at the results of a negative shift like the misfortune that has befallen Bear Stearns (BSC - commentary - Cramer's Take). I can't prove this, but I think central banks around the world realized they had to step up to support the dollar to avoid another disaster in the financial space. I don't know what came first, but the shift we have been looking for in the oil/gold markets has been extraordinary, and whether it was the dollar stabilizing or commodities downticking that led to the better dollar is beside the point. The dollar has rallied a bit and gold and oil have plunged. That takes the pressure off the world's economies, at least psychologically, and allows the frozen fixed-income markets some life.

The opportunity to buy distressed U.S. financial merchandise with inflated currencies might be too much to ignore. Bear markets have violent rallies that quickly dissipate, and the naysayers feel that's what we have here. I disagree. We will have wrenching volatility, but I think (still) that we have seen the lows for the year.

I get to see Lola Jane for the Easter weekend. I can only hope all of you have as good a time.

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A Stable Dollar Fixes a Lot of Our Problems
Originally posted at 2:07 p.m. EDT

Before I left to watch it rain in Vermont, I wrote, "It could be that commodities, which took a dive on Monday, will soar again. But it could be that the dollar might begin to firm as the world sees an attempt to put America's financial house in order."

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Vincent Farrell Jr. is a principal of Scotsman Capital Management. Prior to joining Scotsman in April 2005, Farrell was chairman of Victory Capital Management of Cleveland and chairman of Victory SBSF Capital Management in New York. He was a founding partner of Spears Benzak Salomon & Farrell, which was acquired by KeyCorp in 1995. Vince held a variety of positions in his 23 years at SBSF, including chief investment officer, and he served as the portfolio manager on a number of the firm's largest client relationships. He is a regular guest on CNBC as well as other national print and broadcast media.

Prior to joining SBSF, Vince spent nine years at Smith Barney as a vice president, sales.

Vince graduated from Princeton University in 1969 and received his MBA from the Iona College Graduate School of Business in 1972.