Catching up after a busy day:

• I spent most of my day with the koala bears at the zoo!
• Stocks rallied smartly from the morning lows and then sold off near the close.
• The U.S. dollar was flattish.
• Bonds were also unchanged.
• Municipals had a bid. I continue to sell down my closed-end municipal bond funds.
• Crude rallied.
• Energy stocks rallied.
• Banks sold off, as expected.
• Staples were stronger.
• Biotech was flat. Allergan (AGN) rallied after yesterday's weakness and Valeant Pharmaceuticals (VRX) was disappointing in light of Ackman upping his position.
• Retails were up and down; my recent buys of Bed, Bath & Beyond (BBBY) and Best Buy (BBY) fared well.
• (T)FANG -- Tesla (TSLA), Facebook (FB), Amazon (AMZN), Netflix (NFLX) and Google, now Alphabet (GOOGL) -- broadly lower.
• NOSH -- Nike (NKE), O'Reilly (ORYL), Starbucks (SBUX) and Home Depot (HD) -- mixed as HD rallied.
• Disney (DIS) and Comcast (CMCSA) suffered - both on my Best Ideas List (short). 

I did little today.

Tomorrow should be a snooze fest.

I'm putting out some more SPY shorts now at $209.40.

Right now I'm watching and doing nothing.

The latest from Sir Arthur Cashin:

"Stocks retested the morning lows with no negative follow-through. Crude also firmed after losing a chunk of early gains. Europe's close is also helping bulls.

The fate of the Russian crew could be critical. The worst would be if they fall into ISIS hands."

Peter Boockvar talks this morning about the consumer confidence, retail sales and the Richmond Fed manufacturing index:

"The Conference Board Consumer Confidence index for November fell to 90.4 from a revised 99.1 last month (initially 97.6), and that was well below the estimate of 99.5. It is also at the weakest level since September 2014. The Present Situation dropped by 6.5 pts and the Expectations component was lower by 10 pts.

A key factor in the headline weakness were the answers to the labor-market questions. Those who said jobs were plentiful fell 2.8 pts to 19.9, matching the lowest level since April, and those who said jobs were hard to get rose 1.6 pts to the most since July. Also, those expecting 'more employment' fell to 11.6 from 14.4 in October and vs. 15.5 last year, and that is the weakest level since October 2011. Expectations of an increase in income fell almost 1 pt, but still remain above its level of one year ago.

Business conditions also softened in both the present and for the six-month outlook for those seeing 'good conditions.' Those who plan to buy a home fell 0.6 pts, but are back in line with the six-month average. Those who plan on buying a car/truck bounced by 2.6 pts after falling by 3.3 pts in October. Inflation expectations for the coming year were 5% vs, 5.1%, and in line with the six-month average.

Bottom line, it was the 'less favorable view of the job market,' according to the Conference Board, that was the main reason for the softness in confidence. They also said: 'Heading into 2016, consumers are cautious about the labor market and expect little change in business conditions.'

Outside of easy-credit-driven auto sales, this cautious attitude has certainly been seen in retail sales, where 'control group' retail sales are running about 100 bps below historical levels of growth. The savings rate of 4.8% is certainly well above the levels seen in the mid-2000s, but is about in line with the 20-year average.

The string of soft manufacturing indices continues, as the November Richmond Fed survey was -3 vs. -1 in October and below the estimate of +1. This follows a negative print from New York, and barely positive ones from Philly and Kansas City. The Richmond index is negative for a third-straight month. From the Richmond Fed: 'Shipments remained sluggish and new orders declined. Hiring in the sector changed little compared to the previous month, while the average workweek shortened and wages rose mildly. ... Manufacturers' expectations were less optimistic in November compared to October. However, they still looked for an improvement in business conditions during the next six months.'

According to a research report by the Dallas Fed, the Richmond and Philly manufacturing indexes had the highest correlation to the national ISM index. The November ISM is expected to remain around the unchanged level at 50.5 vs 50.1 in October."

I've continued every day over the last week or so to reduce my exposure to closed-end municipal-bond funds on strength and increase my long of the Blackstone/GSO Strategic Credit closed-end fund (BGB) on weakness.

The latter position is pretty sizable now.

I'll be in and out of the office over the next two days as I deal with family stuff ahead of the holiday, so my posts will be less frequent and shorter than usual.

Right now, I'm off to the zoo with a special little girl!

Here's a good reason (from yesterday's opening missive) for bank stocks to suffer from some profit-taking in the weeks ahead:

Source: Zero Hedge

There's been a lot of discussion of the likely 25-basis-point rise that we'll see in the fed-funds rate following the Federal Open Market Committee's December meeting.

But other interest rates are rising -- increasing the cost of capital to corporations while reducing the value (and raising the costs) of stock buybacks.   

Yesterday's two-year Treasury-note auction got little notice, but the yield rose to its highest level since 2010.

It's also important to note that other interest rates have risen even more rapidly. For example, the KDP High Yield Daily Index was at 6.92% as of Friday, compared to only 5.07% back in February. And Moody's BAA index was yielding 5.46% as of Friday compared to only 4.29% in February.

In yesterday's opening missive, I wrote:

"On that last point, high-yield bonds are definitely acting 'junky.' This chart amplifies just how significantly weak the sector has been this year:

CCC-rated bonds have underperformed BBs over the last 12 months by 700 basis points (and by over 450 basis points ex-energy). There are only three previous instances of such deep underperformance. Two coincide with the mature credit cycles of early 2000 and early 2008 and one was a 'false positive in late 2011."

Take notice.

Some important reads to check out this morning:

• An open letter from my old boss Ralph Nader to Federal Reserve chair Janet Yellen, as well as a Bloomberg article on Yellen's response.

• The latest from former Fed staffer Danielle "Double D" DiMartino Booth.

• Forbeslooks at most popular stocks among hedge-fund billionaires.

• Peter Boockvar posits in a CNBC.com column that bull market is over.

• Business Insiderreports that Sotheby's stock has lost around a quarter of its value -- a signs that world's richest people are in trouble.

• Bush-era Treasury staffer argues at Investors.com that 2016 Republican presidential candidates should remember that "It's the economy, stupid."

• Chief White House economic adviser Jason Furman and Douglas Holtz-Eakin of the American Action Forum give The Wall Street Journaltheir opposing views of where the economy is going.

• The Brookings Institution's George Perry weighs in with a RealClearPolitics column on whether the economy will decide the 2016 election.

• Harvard Business School Dean Nitin Nohria recently argued that historians should write more biographies of business leaders like Steve Jobs. Now, an historian responds.

As an expression of my cautiousness, I'm now short the ETFs of China, England, Germany and France.

Enough said.