Gold Should Rally for QE3


It’s always nice to know that stocks can actually rally. And seeing stocks
build on their gains throughout the day is a bonus.

Yesterday’s rally appears to be a mix of relief and short-covering. For
instance, I suspect the move for Citi (NYSE:C) was helped
along by shorts saying “enough is enough” and covering their downside
positions.

You’ll notice that Bank of America (NYSE:BAC) finished in
the red, though off its’ early lows. Investors are still bearish on
banks.

High Hopes for QE3

I’m a little surprised by how high QE3 expectations
have risen. Given how much flack the Fed took for QE2, and the commodity
inflation it sparked, I expected the market to be opposed to another round
of liquidity-pumping.

But that’s the semi-psychotic nature of the stock market, at times.
Investors might complain about the spending, about the monetary expansion
and the rising commodity prices.

Still, stocks like liquidity, even if it is inflationary, and even if it
creates imbalances and potential bubbles in the economy.

Thursday’s Top Performing Small Cap Stocks (CMRG, EK, LTS, HOTT, HMPR)


Only a handful of small-cap stocks managed to finish in positive territory
on Thursday, as U.S. markets fell in line with those in Europe and Asia and
finished their trading sessions with precipitous declines.

Of all the issues traded on the New York Stock Exchange and Nasdaq Stock
Market, you could count the number of double-digit gainers on one hand –
just five posted gains of more than 10 percent.

Leading the way was retailer Casual Male and downtrodden Eastman Kodak,
which holds a healthy patent portfolio that could be for sale.