Rules of Disengagement

No place for beginners or sensitive hearts
When sentiment is left to chance
No place to be ending but somewhere to start
--Sade

Can't recall a time in the past few years where I've had so little feel for, or interest in, near term market direction. I've been elongating my time horizon for risky positions, so I'm less tuned in to the granular flickering ticks. In a world where market participants seem to be reducing time horizons and reactively trading, I prefer to increase my time horizon and pro actively invest.

Using an investor's stance, however, I currently see little value out there. Outside of some pounded down, dividend paying names in Big Pharma such as Merck (MRK) and Pfizer (PFE), nearly the entire world seems overpriced. Stocks, bonds, commodities, real estate--all have had significant multi-year, and in some cases multi-decade, runs.

Couple high priced financial assets with massive leverage and a wobbly credit market backdrop, and you have a scenario supportive of lower, perhaps much lower, prices.

The key to successful investing is buying assets at the right price in a favorable environment. Currently, I see neither of these generally.

The implication? High amounts of dry powder (read: cash) and patience. Currently, I do not possess either to the degree that I'd like, but I'm working on it. Beyond select pharma names, which I believe reflect decent long term risk:reward, and some core positions in gold and silver, my goal is to use price to my advantage to shed commodity-related and other positions and get liquid.

And then wait--perhaps for a pretty long time.

positions in MRK, PFE, gold, silver, commodities