Bloomberg says it all.

http://www.bloomberg.com/markets/rates/index.html

Look at that! Yeah I rarely if ever have talked about an inverted yield curve, and I don't plan on talking about it very often, but this demands a least a quick note on the subject. From what I am seeing there, you can get 4.69% on a 6 Month T-Bill and 4.55% on a 30 Year Bond. Now personally I don't have any idea why anyone would buy a 30 year bond, nor why it rallied so impressively on Friday. What I can tell you though is that this is probably not the most positive graph you will ever look at in your life.

Essentially what it is telling people is that something is wrong with the current rate environment and that the FED should stop tightening. Well that's fine with the exception that the FED is not going to stop tightening. Now there in lies the problem. This is going to either through psychology or actual economic events cause problems for the market. Buying stock just became increasingly more dangerous. I would feel quite comfortable sitting on 100% cash at this moment. Here is something else that will scare you:

http://www.stockcharts.com/charts/YieldCurve.html

Use that graph and go back to the peak of the market in the year 2000. It seems oddly identical doesn't it. So now what do you do to make money because of this?

I would say to short companies that need the economy to do well in order to prosper. Industrial companies, manufacturing, stocks that once the economy turns down will do poorly. But wait the economy is still doing well right? That's true but the market discounts future events and a future recession does not bode well for these companies. If I have any specifics I will post them. I am initially looking at SGR.