Markets continued sideways or downward as all eyes are focused on Washington, looking for a deal to avoid the so-called fiscal cliff at the first of the year. There wasn't much news today, except the obligatory "sky is falling" articles. SPX lost $6 to close at $1414 while RUT closed unchanged at $824. Volatility inched up a half point with the VIX at 17%.

There was some economic news today, although it was over-shadowed by the fiscal cliff vigil. The Consumer Price Index (CPI) dropped 0.3% in November and industrial production increased 1.1%. Capacity utilization increased from 77.7% to 78.4%. So all of this data was modestly positive. It seems to support the same old conclusion: the economy is recovering, but at a historically record low rate.

My Dec iron condor stands at a P/L of -$1,760 or -8% with delta = -$55 and theta = +$212. The call spreads remain a little over one standard deviation OTM and the put spreads are almost three standard deviations OTM. I decided to leave the call spreads open over the weekend to benefit from additional time decay. The risk is that a fiscal cliff deal is reached and the market spurts upward, but we have a pretty good safety buffer at this point, so I think it is a high probability move.