The markets continue to just toy with the earlier highs of this year and seem unable to either break through to higher highs or pull back. SPX closed down $1 at $1409 while RUT gained $4 to close at $814. The VIX inched up to 16.5%. Trading volume was up marginally from yesterday with 1.9 billion shares of the S&P 500 stocks trading (the 50 dma is 2.5B). Trading volume on the NYSE was up 6% and volume on NASDAQ was down 2%.

The Case Shiller housing price index rose 0.5% in June, a nice improvement from the 0.7% decrease in the previous month. Consumer confidence dropped to 60.6 in August from 65.4 in July - that isn't surprising. We have high unemployment coupled with a dysfunctional government and a political campaign that is setting new records for irrelevance. Increasingly, the investment theme I am hearing on CNBC is focused on the "fiscal cliff". Buying gold and burying it in the back yard is back in fashion.

While I was at the University of Florida, the Students for a Democratic Society (SDS) were always demonstrating and causing trouble. One student ran for student government president and said he was from the Students for an Apathetic Society (SAS). After the election, he said he was disappointed at the number of students who came out and voted for him - he wished they were more apathetic. We all knew those elections weren't serious, so a little satire was fun - but now our national politics seem equally laughable, and this is very serious. Perhaps we have been too apathetic?

My Sept RUT iron condor stands at a P/L of -$120 with delta = -$105 and theta = +$102. The Oct condor is up $500 with delta = -$23 and theta = +$72. Keep in mind that historically, we are entering a dangerous time of the year for the markets - remember last fall? Watch your positions closely and use tight stops. I don't know where this market is going, but it could get ugly.