NEW YORK ( TheStreet) -- Doug Kass of Seabreeze Partners is known for his accurate stock market calls and keen insights into the economy, which he shares with RealMoney Pro readers in his daily trading diary.
Among the posts this past week were entries about his method and Fed funds forecasts.
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The Method to My Madness
Originally published on Friday, Sept. 20 at 12:00 p.m. EDT. I wanted to emphasize something that is obvious to all subscribers that have been around for a while. As a matter of strategy it is my modus operandi to almost always average into positions (long and short) based on the notion that it is impossible for me to figure out the perfect/ideal entry point. (QQQ) short as an example -- I am averaging up or down (based on macro or micro factors), and my total cost basis might be (far) different from my original mention. Again, QQQ is a good example. I originally mentioned the short at $77.40, but with today's large short add, my average cost is now slighlty over $79. I hope my approach is well understood. At the time of original publication, Kass was short QQQ.
Looking at Potential Outcomes
Originally published on Thursday, Sept. 19 at 9:34 a.m. EDT. If you look at the range of Fed funds forecasts for year-end 2016, the high is 4.25% (Fisher?), the low is 0.5% (Evans?) and Bernanke falls seemingly right in the middle at 2%. The dovish view on the unemployment rate for the same point in time is 6%, while the hawkish view is that it will be down to 5.2%. The median is 5.6%, and that seems to be where Bernanke resides.