Thursday, December 17, 2009

MSCI Europe and Euro Stoxx 50

Daily view of the i-shares MSCI Eafe index, ticker EFA.

Daily view of the Dow Jones Euro Stoxx 50 etf, ticker FEZ.

Both charts above look to be in some trouble.

I caught an interview CNBC's Melissa Francis of Fast Money had yesterday with Jim Chanos of Kynikos Associates. (you can view it here). Chanos had a quote regarding China, which could very well go down as the quote of the year, in which he said;

"the irony about China Melissa, is that Western investors, who decry the amount of government involvement, say health care in the U.S. or government intervention in the financial markets and really find it distasteful are quick to grasp the fact that 25 members of the Chinese politburo in Beijing are able to fine tune this rapidly growing economy. And we also just don't believe the GDP (re: Chinese) numbers. We think they're massively inflated by under depreciating very, very, very shaky capital asset base."

Regarding the euro (ticker FXE) I was hoping for a bounce to get short which never came so I will sit here frustrated content with my long UUP position.

And don't even get me started on the long natty/short crude trade. The nat gas could almost be as crowded on the short side as the U.S. buck is. Ya gotta just love these extraordinarily bright hedge fund managers with their MBA's from prestigious schools as they proceed to pile into trades like black Friday shoppers at a Walmart.

Truth be told these hedge fund managers, or valets as I am fond of calling them as they are no smarter nor sophisticated than the valet at you fav restaurant or golf club, are really strikingly similar to that drunk frat boy (or girl) you see on the dance floor at almost every wedding. What I find truly fascinating about all this is that this is the talent many in the mainstream media are claiming needs to be paid (re: pay czar and compensation debate).

This is just like American football. So just as in football, stop watching the glamor positions like tailback, quarterback and flanker (wide receiver) for the sizzle and focus are the foundation or the 'steak'. This is the place where the real work is done, where the game is won or lost, that being the offensive and defensive line. Ironically, I would remind you this is historically the lowest paid of positions but slowly that is changing, as it will on Wall St. as well.

Good speculating to you all and please remember to never forget that "an investor is a speculator who made a mistake and will not admit it".

Open Positions:
Long 1 unit Direxion Large Cap 3X Bear ticker BGZ @ $19.34
Long 2 units Direxion Small Cap 3X Bear ticker TZA @ $12.06
Long 1 unit Direxion Emerging Mkts 3X Bear ticker EDZ @ $6.05
Long 2 units Direxion Financial 3X Bear ticker FAZ @ $19.65
Long 2 units Ultrashort Xinhua China ticker FXP @ $8.49
Long 1 unit Ultrashort Real Estate ticker SRS @ $9.82
Long 1 unit Direxion Tech 3X Bear ticker TYP @ $10.68
Long 1 unit US Dollar Bull ticker UUP @ $22.52 stop @ $21.97
Short 1 unit i-shares Russell 2K ticker IWM @ $61.70 stop @ $63.80


Sean said...

Miss your regular posts. Are all your positions current? If things look darkest before the dawn, the bears own the night! I'm about to throw in the towel. Never have we had such a united alliance between msm business news and a leftist government in the US. This time things might be different, and it's not vive la difference!

At any rate. Merry Christmas -- and thanks for all the sharing of your hard labor.

Harleydog said...


Light posting duty with holidays here. All positions are current. Agree person "puke" level is often wonderful contrarian indicator, often marking extremes. Merry Christmas to you as well.