Wednesday, April 2, 2008

Mid Day Update

I want to touch on the subject of "get the shorts" rant I had yesterday. I read the Icelandic authorities want hedge fund shorts investigating for attacking their currency. Yes I realize shorts are responsible for most of the ills the plague society but here's a shot in the dark. How does Bear Stearns CEO Schwartz com on pom pom TV, tell the world everything is A-okay only to go belly up 24 hrs later. Bernanke said he had 24 hrs notice in his testimony this morning. Okay where is the outrage at Schwartz, why is he not being investigated, doesn't Lehman have evidence of collusion regarding this issue. Bear CEO Schwartz riding off in the sunset happy, set and carefree, yet we're ready to lynch the shorts. Kinda like how we're handling the housing bubble.

A few housekeeping notes, I was stopped out of my DXD position at $53 for a 5 pt loss. Painful and probably right at the lows of this move. But as a friend always has said, "sure that $20 stock may go to $40 but it may do so via $5 first.

Stopped out of DB at 119.50. I heard a report that the regulators overseas had banned short selling in it and UBS. It matters not a whit. I am out and now that I am the stock is free to head to $80

I was stopped out of 2 units C at $24.45 for a pt loss, disgusting to say the least but who am I to argue with the tape. Its a one sided discussion.

I was stopped out of Agco at $62.80 for a 1.80 loss on 2 units.

I caught the Bernanke Capitol Hill gig today. I am gonna let you in on a little secret about the Bear Stearns collateral. They (the Fed) have absolutely no clue as to what the collateral is worth. They had 24 hrs to do the deal. As I have said before Fannie Mae couldn't produce audited financials for over 2 yrs and yet the Fed can due diligence Bear's paper in 24hrs. If you believe any of that I have a wonderful bridge to sell you, cheap mind you!

Home prices underlay all this paper and there is no end in sight for the drop in prices. Yes I heard the cat from Trim Tabs claiming the bottom is in. Not from where I sit is it in, but don't trust me ask Centex (CTX) who just sold $900 million in real estate which was written down to about $540 million to a Texas outfit for the princely sum of .......drum roll please......$161 million. 8500 lots in 11 states. But I will bet dollars to doughnuts OFHEO would find a way to spin this one positive.

Good speculating to you all.

Open Positions:
Long 6 units Currencyshares Japanese Yen ticker FXY @ $88.55 stop at $91.40
Long 2 units Ultrashort Financials ticker SKF @ $102.20 stop at $98.70
Short 2 untis Daimler AG ticker DAI @ $86.20 stop at $88.05

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