Financials: Mar. Bonds are currently 6 higher at 119'00. We continue to hold the combination of short Mar. Bonds and short the Mar. Bond 115'00 put. We continue to have an open order to cover the Mar. Bond 115'00 put at 19 points (currently at 1'02). I feel the best case scenario for this position is that the Bonds break sharply and we eventually get assigned a futures position at 115'00 which will take us out of our short futures position at an effective price of 113'24 (we sold the 115'00 put at 1'08). Barring this kind of break we will be able to cover the 115'00 put at the recommended price and look for another a partial hedge for the short Bond position.

Grains: On Friday Beans were 4 cents lower, Corn 12 lower and Wheat 13 lower. Over night Corn was 3 lower, Beans 5 higher and Wheat 4 lower. We continue to hold the combination of short out of the money puts and calls in the Mar. Beans (the recommended position was being short the Mar. Beans 960 put and the Mar. Beans 1160 calls at 60'0 cents). Take profits if your spread gets to the point where there is a 25'0+ profit.

Cattle: On Friday Dec. Cattle closed 20 points higher at 81.00. We have been stopped out of our long Dec. Cattle position. As for spreads, we have rolled long Dec positions from the long Dec. / short Apr. spread into the Feb. contract leaving us long Feb. / short Apr.

Silver: Mar. Silver is currently 45 cents lower at 18.07. We remain long out of the money call spreads in the July contract. I will be interested in once again looking to futures market from the long side on any further sharp breaks.

S&P's: Dec. S&P's are currently 4.00 lower at 1104.00. On Friday the market made a new yearly high at 1119.00 before trading unchanged for the day and closing moderately higher. A close below 1095.00 could generate a sell signal. Consider buying out of the money puts as portfolio insurance.

Currencies: As of this writing the Mar. Euro is 40 lower at 1.4782, the Swiss 33 lower at .9790, the Yen 103 higher at 1.1133 and the Pound 100 lower 1.6318. We remain long out of the money puts in the currencies. On Friday we took advantage of the sharp break by rolling put positions into lower strike prices. The Mar. Dollar Index is currently 8 higher at 76.36. If you remain long the Dollar Index (Mar.) either take profits or raise your protective sell stop to the 75.90 level.

Regards,

                Marc