Fund share prices as of: 6/04/07

Fund -	G Fund	F Fund	C Fund	S Fund	I Fund
	11.95	11.28	17.16	21.08	24.86
$  Change -	+0.00	+0.02	+0.03	+0.07	+0.09
% Change -	+0.00%	+0.18%	+0.18%	+0.33%	+0.36%
	L2040	L2030	L2020	L2010	L Income
	18.55	17.61	16.72	15.31	13.23
$  Change -	+0.04	+0.04	+0.03	+0.02	+0.02
% Change -	+0.22%	+0.23%	+0.18%	+0.13%	+0.15%

Systems

Stocks were modestly higher across the board yesterday, as were bonds, which have been hit hard lately.  Stocks tend to under perform when they're trading at a high, and bonds drop sharply.  We'll see if that is just another tendency that this strong market can overcome.

I really don't have too much to add to yesterday's commentary.  The sentiment survey system is on a sell signal this week, the TSP Trader System (Trader Fred) is on a buy signal.  China's Shanghai Composite was getting clobbered again early Monday night, down over 6% at one point, but is seeing a bounce as it is now positive as I write this.  It's quite volatile and could close anywhere.

U.S. stocks seem to be able to shrug off any problems that arise, but when you think about it, when are we ever without problems?  Never.  There is always something of concern going on and we know the market likes to climb a wall of worry.  But you have to ask yourself how much risk you are willing to take at any given time?  If there was a 50% chance of a 5% correction, what would you do?  Or what about a just 5% change of a 25% correction?  Ho about then?  We're all in different situations so the answers to questions like this will vary depending on who you ask.

I mentioned the new EbbChart system yesterday and someone noticed that ebbnflow, the author of the system, was up "only" 8% this year, yet his system is now up 16%.  The answer to that is the same reason our Sentiment Survey system is up 13%, or the TSP Trader System is up 7%, and my account is only up 2% - we are not following our systems completely.  It is very difficult to fight your emotions.  Fear and greed get the best of us.  There's a lesson there for all of us.

Of course with all of the system and strategies going on, there are bound to be conflicting signals.  The best thing to do if you decide to follow a system, is to stick with that one system, and follow it verbatim.  Once you enter in your own reasoning you are fighting the effectiveness that these systems are designed to give, which is to take emotion (fear and greed) out of the equation.  Food for thought.

Not everybody wants to follow a system.  I have been that way, choosing instead to take a broad overview of the current situation based on a series of indicators and data, and making a decision based on that.  But I am slowly coming around to the benefits of systems.

That's all I have for today.  I am currently 100% F fund.  You can check out Trader Fred's TSP Trader System commentary his system page.  See you tomorrow!