[aquaswim47]

I'm going to take the opposite side of the transaction. I think that the market should be shorted on the basis that the FED will RAISE interest rates. I think people should buy consumer staples stocks; stocks like JNJ, UTX, CAT, MCD, BA, XOM/RDS-A/SUN,PG, PNRA, T, and GSK/TEVA. Everyone out there believes the FED will cut rates. Thus, if the FED does cut rates, that attrition (eating away at future returns with present returns) is already priced into the underlying stocks. But if the FED leaves rates alone or raises rates, expect the market to drop 5% with stable rates or 12.5% in the event of a rate rise.

However, mid-term (3-5 years), expect a robust stock market. I'm solely basing this short theory on the fact that everyone believes in a FED rate cut and I believe the FED's obsession on inflation will be overpowering.

I'm looking forward to your insight and comments. I believe the FED is disappointed about a 2% rise in inflation; a rate of inflation that no one else cares about.