Seeking Alpha by Adding Beta

Last week markets wanted to hear three most important words which were worth billions of $$ and they got what they wanted to hear. In his semi-annual update to Congress, Bernanke did say that Fed Interest rates would stay "exceptionally low" for "extended" period of time ! And what a difference these three words made - on that particular day, markets went up by 100 points which is worth many billions of $. As investor, low rates are very crucial particularly at this juncture since economy is just coming out of ICU and unemployment is still near double-digits. So low interest rates are serving as "oxygen" for economy. "Extended" means Fed won't start raising interest rates for at least 6 months. So road is clear for investors for at least six months except for " European " mess ! Now coming to "Greek" problem: Last week Greek and Europe were playing game of chicken and finally Europe is coming to terms of helping Greek by

Earnings season is almost over and majority of companies beat earnings - what is relief especially since markets has built up so much expectations. Last week finally DOW broke its 4 week losing streak but still very much hovering around 10000 range. I was predicting it to touch 11000 based on momentum and earnings surprises. If not from Greek and overall Europe problem, it might have come very close to 11000 - instead Europe problems brought it down below 10000. One way it was a good break since non-stop ascent was not sustainable. Now that it has taken some breather and assuming Europe resolves its issues about PIIGS deficit by standing firmly behind Greek debt, markets would resume its upward journey. I am predicting DOW to cross 10500 by Mar 31. Only major risk is Greek problem - if Europe is not able to give clear direction about Greek, there is risk that DOW may fall near 9500. Last Sunday's Superbowl match was great - while my prediction did not come true, I was happy with

Debt troubles in "PIGS" countries - Portugal, Ireland, Greece and Spain seem to be threatening nascent worldwide recovery. It is reflected in losses in stock markets over last 4 weeks - some of these losses approaching 10% which would qualify for a technical correction. So are troubles facing these countries similar to what happened to financial companies in 2008 resulting in Bear, Lehman, AIG and many other fiasco ? Governments used to be last stop which bailed out these banks. Who will bail out these countries ? Fortunately (or unfortunately as some may think) these countries are part of EU with Euro as single currency. EU and Euro is too important for all Europe and then big European nations like Germany and France won't let Greece or Portugal derail complete EU. So my prediction is that these countries would be bailed out by either EU or IMF but they would have to pay price by making sure that their budget deficits are brought under control in next 2-5 years. Now