Friday, April 18, 2008

Update and Thoughts.

The stock traders like the Citigroup news, but the bond traders? They're thinking a little differently. And don't look at Libor as you will will not like what it is saying. As for Google, great news great pop, congratulations if you're long. Let me qualify that a little, if you're long form 425-450. Now if you're one of the longs north of $625 all the way to $750 well, that's another story. Caterpillar, great numbers. No doubt.

The bulls are enjoying their time and evidenced by the enthusiasm of the pom pom TV anchors. We shall see how this plays out. I still am off the opinion that the bulls need to show how all the issues that were here prior are now irrelevant. Check out Goldman Sachs increase in level 3 assets. Do you have any idea why they are moving assets into level 3, it sure is not because they are becoming more marketable.

The bulls continually hope this is the end. Hope is not enough to trade on. This is a bear market rally nothing more. The size of the move the, severity, the quickness, all indicate short covering. Some cat on TV said either the bond market or the stock market has it really wrong, and he thought that stocks had it right! My lot is with the bond traders.

I want to talk about oil for a second. With the upward run, we get talk of all the usualy suspects, speculation, the dollar, demand, recession, geopolitical risk, yet not a mention, not a word of the real culprit PEAK OIL ! Gee, I wonder why?

Global production has peaked, demand shows no sign of waning and if it does domestically it will be more than offset as emerging markets emerge. The population numbers dictate that. Believe me the Saudi's, et al would love to ramp up production at these levels but the know something most over here are yet to discover, the reserves they claim they have are not there. Now I stand to be corrected, I want to be corrected, I would love to be corrected. All they have to do is let independent auditors in to do the work. Until then, case closed.

Oh yeah, $6 or $7 /gallon gasoline is going be really bullish for that HELOC'd, credit card maxed consumer. Look at the numbers they show a consumer in worse and worse shape not better. Buy stocks on that news for sure.

The boys from Comstock have their weekly missive out which as always is worth the time to read.

Housekeeping notes, I was stopped out of multiple positions late yesterday and today.

Late yesterday I was stopped out of the following:
SKF at $104.05 for just less than a 2pt profit on a single unit.

This morning I was stopped out of the following:
QID at $43.65 for a pt loss on a single unit.
TWM at $73.70 for a pt and change loss on a single unit.
DXD at $51.75 for a 2pt loss on 2 units.
SRS at $83.20 on the gap down for a little over 3pt loss on 1 unit.
FXF at $ 97.70 for a 2 pt loss on a single unit.
LEH at $46.60 for a 5.50 pt loss on a single unit.

Good Speculating to you all.

Open Positions:
Long 6 units Currencyshares Japanese Yen ticker FXY @ $88.55 stop at $91.40
Long 2 units US Gasoline Fund ticker UGA @ $51.25 stop at $51.74
Long 1 unit Allis-Chalmers ticker ALY @ $14.45 stop at $12.64
Long 1 unit Frontier Oil ticker FTO @ $27.90 stop at $24.64
Short 2 units Daimler AG ticker DAI @ $86.20 stops at $84.20/$82.20
Short 1 unit Darden ticker DRI @ $35.05 stop at $37.18

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