1994 Redux: Beware of the Fed Meeting

Editor's note: This is the second in a week-long series titled "1994 Redux," which compares current market conditions to those of six years ago.

Just how grueling was 1994? What still awaits us as this parallel year unfolds? Consider what happened to our firm six years ago next week.

Then, as now, we were playing it lean. Then, as now, we had shorts on and plenty of cash. Then, as now, we were struggling every day to try to find opportunities to make money as the Fed raised rates steadily and mercilessly.

We tried to approach the whole market from the point of view of the Fed. It was commodity inflation that was roaring then and the Fed wanted to kill that commodity inflation. So what we did was short all of the commodity producers, companies like Dow Chemical(DOW Quote) and Dupont (DD Quote) and Phelps Dodge (PD Quote) and Alcoa (AA Quote). ...