Monday, March 30, 2009

Darden Restaurants Chart -DRI


A reader emailed me with some thoughts on Darden. Given that I am still watching DRI quite closely I thought I would post a chart on it with some thoughts. What little common sense I have left tells me that "eating out" is a luxury to be severely curtailed as the economy weakens. But then again, with the trainload of short bus riding equity boyz, one sees paraded out daily on the pom pom network and littering the pension fund landscape, we can never be surprised to see a suspension of common sense to the speculative arena.

Please remember that, as many found out the painful way in the tech bubble, this suspension of common sense, while stupefying, is never ever permanent.


Housekeeping notes;

I was stopped out of my long TBT position this morning at $43.75 for a loss of a 1/2 point on 1 unit long.


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

Open Positions:
Long 2 units Ultrashort Real Estate ticker SRS @ $49.85 stop @ $49.78
Long 1 unit Ultrashort Emerging Mkts ticker EEV @ $38.75 stop @ $36.18
Long 1 unit Ultrashort China 25 ticker FXP @ $25.15 stop @ $23.38
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

Cess Pool Plain and Simple.


I want to bring your attention to a monster story that is now out in the open. Kusdos to the blog Zero Hedge for the story. Remember all those claims about the first 2 months of the year as being extremely profitable for the big banks. Well, according to Zero Hedge in this post AIG Was Responsible for the Banks' January and February Profitability. (hat tip to Zero Hedge) Please visit this great blog and read the post for for yourself. Zero Hedge sums up the situation perfectly, which I have re-printed below;

For those to whom this is merely a lot of mumbo-jumbo, let me explain in layman's terms:
AIG, knowing it would need to ask for much more capital from the Treasury imminently, decided to throw in the towel, and gifted major bank counter-parties with trades which were egregiously profitable to the banks, and even more egregiously money losing to the U.S. taxpayers, who had to dump more and more cash into AIG, without having the U.S. Treasury Secretary Tim Geithner disclose the real extent of this, for lack of a better word, fraudulent scam.

In simple terms think of it as an auto dealer, which knows that U.S. taxpayers will provide for an infinite amount of money to fund its ongoing sales of horrendous vehicles (think Pontiac Azteks): the company decides to sell all the cars currently in contract, to lessors at far below the amortized market value, thereby generating huge profits for these lessors, as these turn around and sell the cars at a major profit, funded exclusively by U.S. taxpayers (readers should feel free to provide more gripping allegories).

What this all means is that the statements by major banks, i.e. JPM, Citi, and BofA, regarding abnormal profitability in January and February were true, however these profits were a) one-time in nature due to wholesale unwinds of AIG portfolios, b) entirely at the expense of AIG, and thus taxpayers, c) executed with Tim Geithner's (and thus the administration's) full knowledge and intent, d) were basically a transfer of money from taxpayers to banks (in yet another form) using AIG as an intermediary.

For banks to proclaim their profitability in January and February is about as close to criminal hypocrisy as is possible. And again, the taxpayers fund this "one time profit", which causes a market rally, thus allowing the banks to promptly turn around and start selling more expensive equity (soon coming to a prospectus near you), also funded by taxpayers' money flows into the market. If the administration is truly aware of all these events (and if Zero Hedge knows about it, it is safe to say Tim Geithner also got the memo), then the potential fallout would be staggering once this information makes the light of day.

Do you expect anything less when there are no consequences. There is no law, there is no order, there is no cop, there is no decency, it is truly an atmosphere of get mine while I can.
I wish I could say I am appalled. I wish I could say I am shocked but unfortunately I am not. Never in my wildest dreams, as bearish and as cynical as I have been, did I think the culprits would be this brazen. Never did I expect this level of audacity in their looting and pillaging. But yes once again no matter how bad you think it is, it always is worse.

What I wouldn't give to be in charge for 12 months. Oh what I wouldn't give for the opportunity to clean the markets up, my way. And yes, it involves a very adult form of corporal punishment.

You think CNBC is bright enough to link the bloodbath in the futures this morning to this? Ha, Ha, Ha, Ha, surely you jest as that would be too funny. It would also require a functional IQ of about 64 which unfortunately either they don't have or the restraint collar will not permit (advertisers dear reader). You figure out which.

So you can continue to stay long stocks. You can continue to listen to the touts via the likes of Steve Grasso, Peter Costa and the other crumb eating stock clowns. Unfortunately they will know of the bad news after the fact always reiterating the self-absolving quote " we all knew this news blah blah blah". Please count how many times they say that today.

Ahhh the humility or lack there of. No worries though as it's not their money is it now, it's yours. So hang in there. Hope for the best. You're gonna need it.


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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $43.74
Long 2 units Ultrashort Real Estate ticker SRS @ $49.85 stop @ $49.78
Long 1 unit Ultrashort Emerging Mkts ticker EEV @ $38.75 stop @ $36.18
Long 1 unit Ultrashort China 25 ticker FXP @ $25.15 stop @ $23.38
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

Friday, March 27, 2009

Charts as Promised






I know the China miracle as well as the Emerging Markets story. I just can't help wondering how these traditionally easy to get in, hard to get out markets will react if things over here don't turn around and recover later this year as many of the 'rally lovers' claim.

Remember these pundits who are enamored with this rally and are claiming recovery around the corner never, never saw any of this coming. My gut tells me that violent rallies like that of the past 2 weeks are not bottoms. Bottoms form quietly after all have taken their ball and gone home.

Not amidst a party like atmosphere with celebrities and pretty faces calling bottoms. I find it extremely interesting that noted short seller Doug Kass has vehemently called a bottom here. I like Doug and he does his homework but wouldn't it be fitting that the market discredits not only the perma-longs but the perma-shorts before bottoming.

I also cannot help but acknowledging that it was the pros who bought the head fake rally in 1930 only to get crushed in the next leg down. Could this be happening once again as many thoughtful, respected pros who avoided getting caught in this mess are now jumping in. Will they need to be crushed before we TRULY and solidly bottom. My gut tells me yes though the market could care less what my mind or my gut thinks.

Just some items to consider the next time Propaganda Central aka CNBC hypes the latest day's rally.

Remember that sometimes he who loses the least is the winner. Now if only one Joe Cassano of AIG had understood and respected this mantra.


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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $43.74
Long 2 units Ultrashort Real Estate ticker SRS @ $49.85 stop @ $49.78
Long 1 unit Ultrashort Emerging Mkts ticker EEV @ $38.75 stop @ $36.18
Long 1 unit Ultrashort China 25 ticker FXP @ $25.15 stop @ $23.38
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

Long EEV and FXP

Given the healthy rally across all global markets, relief rally?, I am inclined to test the waters short once again.

I am getting long 1 unit of the Ultrashrort MSCI Emerging Markets ticker EEV here at $38.65 with a stop at $36.18

I am getting long 1 unit of the Ultrashort FTSE/Xinhua China 25 ticker FXP here at $25.05 with a stop at $23.38

Charts are coming shortly but think island reversal.

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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $43.74
Long 2 units Ultrashort Real Estate ticker SRS @ $49.85 stop @ $49.78
Long 1 unit Ultrashort Emerging Mkts ticker EEV @ $38.75 stop @ $36.18
Long 1 unit Ultrashort China 25 ticker FXP @ $25.15 stop @ $23.38
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

Couple of Thoughts

I was away from my post yesterday off and on so my apologies for not posting.

Regular readers know I am not the most brightest bulb in the room s0 I would appreciate someone explaining to me why deflation, or falling prices, is such an awful thing. The authorities would have you believe that deflation is the leprecy of our age. To be feared above all else.

Why is defeating deflation so important that the powers that be, the masters of the universe, the smartest guys in the room, are "all in" with OUR MONEY to do it ??!!

That they would risk the survival of the republic to do it?

Which got me thinking to this....

I know people have focused on the Jon Stewart/Jim Cramer interview feud. I think the more important one was Stewart's interview with former Fed Chairman, Maestro of our current predicament Allan Greenspan (I think you can search you tube to find it).

In the interview which was some months ago Stewart talked about how Greenspan lowered interest rates everywhere and always. Stewart went on to say, and I am recalling this from memory now, "doesn't that penalize savers and reward risk taking and gambling." Greenspan responded that Stewart understood things quite well.

Think about that exchange for a while. It will go a long way to helping you understand some of the policy responses by government.

We must think about things from the other side of the table.

Asking questions like the following;

Whom does inflation benefit?
Whom does inflation hurt?
Whom does deflation benefit?
Whom does deflation hurt?

Maybe some lights will start to go on and the wonderful thing about this is you do not even need a PhD in economics. You know, the degree they have hundreds of in the halls of the Fed, the Treasury and Wall St. Kinda the ultimate oxy moron, no?

Housekeeping notes;

Yesterday I was stopped out of the following;

1 unit of SKF at $91.30 for basically a flat trade on 1 unit long.
1 unit of SDS at $73.75 for a loss of just over a pt on 1 unit long.
1 unit of AAPL at $108.15 for a loss of just shy of a pt on 1 unit short.

Lots of little losses keeps you solvent and able to trade another day and I don't have an army of Ivy league analysts to figure it out, just little ol' lonely me with a BA from Hobocken U.

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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $43.74
Long 2 units Ultrashort Real Estate ticker SRS @ $49.85 stop @ $49.78
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

Wednesday, March 25, 2009

Book Report - When Giants Fall

I have finally finished reading Michael Panzner's new book entitled 'When Giants Fall' for the second time no less ! It is not often you come across a book from an author that is worth reading twice, let alone back to back treats but this is EXACTLY what Mike has provided us with the follow up to his must read best seller, Financial Armageddon.

I can attest that Mike's latest endeavour was well worth this 2nd read effort. Now, unless you have been living in a cave, most are well aware of Michael's spot on best seller Financial Armageddon and his blog which also goes by the same name. If not, the book should be on your 'to do' list and his blog on your daily read list.

Mike took a lot of heat with that first book's title from many in the mainstream, big advertiser bought and paid for, financial media. Mainly out of jealousy and partially for it's, in their opinion, over the top, alarmist title. Little did those masquerading as financial journalists and pundits realize how spot on it would be.

Did you really expect anything less from the regular hear, see and believe no evil, pollyannic, follow the yellow brick road crowd led by the Pied Piper himself Larry Kudlow ? Funny how spot on Michael has been over and over and over again yet I don't seem to see him on that esteemed propagandist's evening show any more? I am open to explanations from that self proclaimed Great American himself but I digress. This post is not about him, it is about Mike's latest literary contribution, When Giants Fall.


This latest contribution from Mike Panzner to the speculating community, and yes we are all speculators as an investor is a speculator who has made a mistake (re:loss) and not admitted it as of yet, is yet again must reading!

Michael pulls no punches as he walks the reader through the global socio-economic domino deterioration that is in progress. I could wax on about all the insightful points Mike makes in the book but I will leave it to you to get off your seat and purchase the book immediately and read it post haste. I cannot recommend it highly enough!

I counsel doing this for as the facts have made abundantly clear, not reading and more importantly heeding his first offering Financial Armageddon was extremely damaging to your financial well being. Ignoring his second offering could be even more damaging, though this time to your physical well being.

I cannot recommend When Giants Fall highly enough. Go out and buy a copy. Do it for yourself and if not you then for your family. I would also suggest you go one step further and purchase a copy for a close friend or relative. I want to be clear here I receive no renumeration in any way shape or form from the author. I do this in an attempt to put forth material which can help you be prepared for what might be on the horizon.

To be frank, deep down this speculator/blogger is hoping and praying the Mike Panzner is completely and utterly wrong in his analysis and argument. It would be better for us all if he were. But as anyone with a room temp IQ should know, which this blogger/speculated possesses, hoping and praying is no way to navigate what lies ahead and is best used in rooting for your favourite sports team.

Again, I truly hope that When Giants Fall is completely wrong but I fear thought that Mike will be correct once again. Forewarned is forearmed as one can now at least take necessary precaution and do something about what lie ahead. When Giants Fall minces no words so consider yourself forewarned.

Thanks Mike.


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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $43.74
Long 2 units Ultrashort Real Estate ticker SRS @ $49.85 stop @ $49.78
Long 1 unit Ultrashort Financials ticker SKF @ $91.40 stop @ $91.28
Long 1 unit Ultrashort S&P500 ticker SDS @ $74.85 stop @ $73.78
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Short 1 unit Apple ticker AAPL @ $107.30 stop @ $108.12

Missed The Apollo Bus - APOL

The chart above is a daily view of my dear friend Apollo ticker APOL, which I have been watching quite closely. The chart shows a beautiful Fibonacci retracement into 'the box', which is a retracement of 50-62% of the prior move.

Notice how APOL almost stopped dead in its tracks at that level. Even that wasn't enough to get your room temp IQ blogger/speculator to get off his duff and pull the trigger. I won't chase it but darn it if you can miss em' even when you're watching em' !!

The mid day market weakness has offered some much needed insulation to my short positions. So yet again and as cowardly as some may find this, I am raising some stops.

I am raising my stop on SRS to $49.78
I am raising my stop on SKF to $91.28
I am raising my stop on SDS to $73.78
I am lowering my stop on AAPL to $108.12


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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $43.74
Long 2 units Ultrashort Real Estate ticker SRS @ $49.85 stop @ $49.78
Long 1 unit Ultrashort Financials ticker SKF @ $91.40 stop @ $91.28
Long 1 unit Ultrashort S&P500 ticker SDS @ $74.85 stop @ $73.78
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Short 1 unit Apple ticker AAPL @ $107.30 stop @ $108.12

Some Stop Management

Okay just a few housekeeping notes given all that is going on.

You might be asking some of the following questions. Aren't we in a rip roaring rally? So why the heck is he shorting equities? Especially so given the bottom is now in according to CNBC's Mark Haines.

Well, to start with, I cannot get my head around what is transpiring in Eastern Europe, what is happening on the employment front, what is happening on the commercial real estate arena, which by the way is truly horrifying, and what has been transpiring in the bond markets both domestic and global.

The U.K. bond auction failure is not a one off event as the Germans, if memory serves me, experienced one back in January. Sure Armageddon did not occur, so that's reason to ignore the evidence? Or worse to jump into equities as most TV shills would have you do?

Given all this, I must respect the overarching need on the part of the short bus riding equity boyz to juice this market for all they can. So, accordingly I am raising my stops like a nervous nelly in an attempt to be defensive.

I am raising my stop on TBT to $43.74
I am raising my stop on SRS to $47.86
I am leaving my stops on the remaining positions alone.


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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $43.74
Long 2 units Ultrashort Real Estate ticker SRS @ $49.85 stop @ $47.86
Long 1 unit Ultrashort Financials ticker SKF @ $91.40 stop @ $88.19
Long 1 unit Ultrashort S&P500 ticker SDS @ $74.85 stop @ $72.38
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Short 1 unit Apple ticker AAPL @ $107.30 stop @ $109.82

Getting Short the S&P 500

The negative divergences continue and as they do, rightly or wrongly, I feel compelled to get shorter of this market which I shall.

I am getting shot the S&P via 1 unit of the Ultrashort S&P 500, ticker SDS here at $74.75 with a stop at $72.38


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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $42.17
Long 2 units Ultrashort Real Estate ticker SRS @ $49.85 stop @ $46.86
Long 1 unit Ultrashort Financials ticker SKF @ $91.40 stop @ $88.19
Long 1 unit Ultrashort S&P500 ticker SDS @ $74.85 stop @ $72.38
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Short 1 unit Apple ticker AAPL @ $107.30 stop @ $109.82

Getting Short Financials

I am prepared to punt the financials on the short side once again via the Ultrashort Financials ticker SKF here at $91.30 with a stop below yesterdays low of $88.91


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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $42.17
Long 2 units Ultrashort Real Estate ticker SRS @ $49.85 stop @ $46.86
Long 1 unit Ultrashort Financials ticker SKF @ $91.40 stop @ $ 88.19
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Short 1 unit Apple ticker AAPL @ $107.30 stop @ $109.82

Apple Follow Up.


Here is the chart on AAPL that I promised.

I realize many are lathered up once again this time with the durable goods number. I would counsel that you pay attention not to this months number but rather to the revision to last months number as this is more pertinent. Notice how it was revised much, much lower. This is lost on the equity boyz but then again, what isn't. The Steve Grasso's of the world might want to call their clients and find out what to do now and further to tell the viewers on CNBC what to do.

The trickle down effect so to speak.

As for the equity boyz why pay attention to revisions when you can ride the number of the day. Who cares if last months durables were revised down, double !! Who cares if Eastern Europe is imploding. Who cares if Britain's gilt (bond) auction was a mess. Why let that get in the way of a nice goose rally. Skim some more before the gig is up.

Then when it all rolls over once again they can blame shorts out there, like me. They can blame the lack of the up tick rule, which by the way I am still waiting for someone to explain to me why there isn't an equal and opposite down tick rule to buy. They can blame mark to market, etc, etc. Same old, same old. Then CNBC can drag out the same old shills with their lame shallow and self serving arguments.

It's all just one big Groundhog Day movie without Bill Murray to make us laugh.

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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $42.17
Long 2 units Ultrashort Real Estate ticker SRS @ $49.85 stop @ $46.86
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Short 1 unit Apple ticker AAPL @ $107.30 stop @ $109.82

Getting Short Apple Inc.- AAPL

I am shorting 1 unit of Apple ticker AAPL here at $107.40 as it tests the upper end of a recently formed channel off the lows of $78 back in mid January.

I realize some want to call a rounding bottom or inverted head and shoulders on AAPL here but given the weight of underlying weak economic evidence coupled with the extent of this rally I am prepared to fade AAPL here with a stop just above yesterdays high of $109.82

I will post a chart in short order.

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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $42.17
Long 2 units Ultrashort Real Estate ticker SRS @ $49.85 stop @ $46.86
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Short 1 unit Apple ticker AAPL @ $107.30 stop @ $109.82

Tuesday, March 24, 2009

Adding to SRS Long

Call me crazy but given the shameless bullishness I am adding a 2nd unit of the Ultrashort Real estate ticker SRS here at $50.25 and am leaving my stop alone.


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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $42.17
Long 2 units Ultrashort Real Estate ticker SRS @ $49.85 stop @ $46.86
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

Punting SRS Long Yet Again

The i-shares real estate ticker IYR is rallying right into a significant resistance area. I am using this strength to get long the Ultrashort real estate ticker SRS here at $49.20 which looks to be a low risk entry area. I am placing my stop at $46.86 which is just below a what looks like a significant support zone.

I am bearish on commercial real estate and maybe everyone else is as well which is why we are rallying. Climbing a wall of worry so to speak. Commercial real estate is a disaster which will be clearly evident with the passage of time.


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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $42.17
Long 1 unit Ultrashort Real Estate ticker SRS @ $49.30 stop @ $46.86
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

In Time the Truth Will Be Known.

Could it be that of all people, congresswomen Maxine Waters (D-CA) is trying to pull the covers back on the house of deciet that is Goldman Sachs.?

Is it me or did the tax cheat, eerrr I mean Goldman's boy, eerrr I mean partner in crime while head of the NY Fed, eerrr I mean current Treasury Secretary Tim Geithner get quite uncomfortable with Ms. Waters line of questioning?

Isn't it amazing what can develop when one marshals one's facts.

Now of course, the venerable white shoe firm Goldman Sachs would never make decisions that were not in the best interest of the partners eerrr, excuse me, I meant the best interests of the country.

You do not have to be a missile engineer to know that if it looks, smells, walks, talks, and acts like as former President Andrew Jackson called it "a den of vipers and thieves" then it very well is one.

In time the truth will be known.

I cannot believe I am about to say this, maybe not 3 cheers are in order, but a least 2 are for the representative from the 35th congressional district of California. Congratualtions Ms. Waters.



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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $42.17
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20























Monster Rally Thoughts

Just like a man dying of thirst in the desert who upon seeing a mirage of a oasis will drink the sand so it is with the equity markets. So starved are these playerz for any tidbit of hope to run the market.

Facts are facts and the market had a wonderful day for the bulls. Suffice to say there are so many non confirmations out there from volume to volatility, just to name a few, that it would take a manager of other's money to buy this market.

I am not going to complain about the rally as this is what markets do. Everyone and I mean everyone seems to have caught this bottom !! To which I offer my utmost congratulations. Just be warned that if it were this easy to pick a bottom in the markets, as all the boobs and boobs on CNBC seem to be doing, we would all be living in Tahiti. As a side note, I absolutely love all the armchair technicians, yes when you have no clue what is going on you turn to technicals, opining how if such and such a level holds you can stick with the market. These same "newly minted technicians" would reference a wiji board if it served their ends.

Do not discount the tricks and manipulations that the Fed and Treasury can use with you as the guarantor. Make no mistake, in poker terms this is an all in bet by the Fed with YOUR money! If you believe that this newest toxic asset program will solve our ills then you are most eminently qualified to run a major insurer, bank, brokerage or better yet the IMF, The World Bank, The Fed or The Treasury.

A reader emailed me and candidly asked that given my criticisms of all the 'quick fixes' by the authorities what can be done to fix this. (thx M.L.)

The answer quite simply is DO NOTHING. Yes, I realize this sounds preposterous to the meddlers among us but it is precisely what must be done. The reason I say this is that if we do not let the failures among us fail we will all fail. I repeat if we do not stop this virus of profligacy and handouts to crony's we will have nothing left.

I cannot state this strongly enough. I do not care the industry or the sector. Until we get this through our thick skulls I am petrified the country that we have all grown up in will cease to function. You cannot risk a limb at the expense of the host. I pray that there are some adults out there who understand this concept for our financial survival depends on it.

The "everything is better" crowd is out in full force pushing the propaganda the worst is over. Expect CNBC to continue to drag out the regular shills. Bill Gross, Bob Doll, Vince Farrell, et al. All very bright men who never met a market that couldn't be bought with both fists. Surrounded by yes men kept in clover by the continued participation of the lumpinvestorate, and yes dear reader that is you!

Do you really expect the manager of the globe's largest portfolio of debt paper coming out of the mother of all deb/credit bubbles to not be in full support of any and all government intervention to support that market?

Do you really expect his lieutenants to call credit and debt anything other than the oxygen of the economy? Do not hold your breath waiting for El-Erian or McCulley of Pimco call credit/debt what it truly is, the lead noose of subservience around your neck, as this is their livelihood.

Do you really expect one of the largest mutual fund magnates to tell people anything other than sit tight and pay fees?

I have the ill feeling that those who are long and have been crushed in this market over the last 18 months will once again refuse to use this rally to reduce their equity exposure which is exactly what they should be doing. Unfortunately they (public) will commit the same mistakes over and over again. This is a gift to get out and lighten up no matter what the vested interest shills may claim.

Housekeeping notes;

Mercilessly yesterdays freight train that was the markets stopped me out of multiple positions;

I was stopped out of my long SRS position at $58.80 for a loss of about $5 3/4 pts on 1 unit.
I was stopped out of my long SDS position at $77.80 for a loss of about $2.5 pts on 1 unit.
I was stopped out of my short GS position at $108.15 for a loss of about $1.3/4 pts on 1 unit.

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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $42.17
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

Monday, March 23, 2009

Stop and Start and Goldman

I was stopped out of my 2 units long of SDS earlier at $80.35 for a loss of 80 cents on 2 units long.


Undaunted I am re-entering this trade of short the S&P by getting long 1 unit of SDS here at $80.15 with a stop at $77.84.

I am also using the inordinate euphoria to get short 1 unit of Goldman Sachs ticker GS into this double top that has formed on on the daily chart.

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

Open Positions:

Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $42.17
Long 1 unit Ultrashort Real Estate ticker SRS @ $64.45 stop @ $58.88
Long 1 unit Ultrashort S&P500 ticker SDS @ $80.25 stop @ $77.84
Short 1 unit Goldman Sachs ticker GS @ $106.40 stop @ $108.12
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20


Long SRS, Adding to SDS

I am using the rally this morning to get re-involved with real estate on the short side via the Ultrashort Real Estate ticker SRS here at $64.35 with a stop at $58.88

I am also using the inordinate celebratory strength due "the toxic asset plan" this morning in the markets to add to my S&P short with a 2nd unit of the SDS here at $82.30.

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

Open Positions:
Long 2 units Ultrashort S&P500 ticker SDS @ $81.15 stop @ $80.36
Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $42.17
Long 1 unit Ultrashort Real Estate ticker SRS @ $64.45 stop @ $58.88
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

Friday, March 20, 2009

Ahhh Goldman

I noticed that Goldman is going on the public relations offensive today in response to the issue of their part in the AIG bailout with a conference call. I have said this before and will say this again so there is no confusion;

this concensus best of breed, master of universe, I could care less if they're Warren Buffett's broker, central banker incubating ground is without question the most perfidious, deceitful, duplicitous, conniving, unscrupulous, piece of garbage on Wall St. They look down their nose at the boiler rooms only that it is not a boiler room they are looking down at it is a mirror.

It is only fitting that the scurrying inhabitants of its hallways find themselves inundated with margin calls on their personal holdings of Goldman stock. Maybe we should suspend mark to market on GS common and replace it with a more economic sensitive, more observation, input laden measure, hey, like a level 3 asset !!, rather than its overly oppressive, illogical, illiquid, and wrong headed daily closing price at 4pm New York time.

Don't think for a minute that the #2 man at Treasury, Geithner's chief of staff Mark Patterson, a former Goldman Sachs lobbyist, is not front and center on this issue for this very reason. No outrage on capitol hill at this debacle now is there? There cannot be as this would require pulling the covers back and admitting the patently obvious, so lets just focus on the $165 million bonus' at AIG. David Copperfied would blush at their slight of hand proficiency.

I believe that the deceit, thievery, and cess pool that our financial markets have become needs to be drained and the perpetrators punished. (apologies to Art Cashin as I have not changed my mind)

Before you say it, this is not schadenfreude on my part. What it is though is a very fine example of the concept of just desserts. The shame in all of this is that King Henry Paulson's appointment to Treasury forced him to divest his Goldman stake before taking office, or at least that is what I am under the impression he was required to do. Lets hope he circumvented rules, laws and basic fair and good business practice by circumvented laws that should in no way shape or form apply to a Goldman partner !! Yes dear readers just desserts.

Caught some of the CNBC interview today with former Fed Governor Randall Krozner. I am not going to pick on the venerable and articulate former governor who now inhabits the hallways of the Univ. of Chicago's Booth School of Business. His continued blind support of policies and operations that are bereft of any deep thought or consideration of unintended consequences absolutely boggles the mind. The choices are few. As Fed governor you ruin the finances of the country or as major business school official, you ruin the minds of the next generation of business leaders or should I call them zombots. Zombies and robots combined together to parrot the mantra of Keynesian, borrow short to fund long, leverage 40 times equity, circumvent laws and rules of standard mortgage contracts, to make quarterly numbers to fund those bonus's.


The furor by the intellectual lightweights that scurry through congress, the Fed, and Treasury is almost comical if not so tragic. It reminds me of how when channel surfing you would catch the local municipal or city hall session where a $25 million sewer infrastructure expansion would yield no questions from councillors or aldermen/women yet a 4-way stop sign proposal would get debated for 60 minutes. Too funny !

The point here is that water finds its own level, you know, lowest common denominator type stuff where you discuss and debate what you are capable of. $165 million in bonus money is mere slippage compared to the billions and trillions being tosses around like candy.

I realize my rant to day is foul and harsh but what does one do or say when the republic is crumbling beneath them. Stay quiet? Or worse mimic that purportedly Great America Larry Kudlow who daily and nightly propagandizes every lie out there telling people all is well, nothing to worry about when the storm of a generation is upon us? I would counter that one might call a great American one that has the courage to stand up and tell people the things they do not want to hear. Unfortunately there are very few of these types left and most certainly none inhabit the halls of congress (Ron Paul exempted), the Senate or the Fortune 500 board rooms.

I meant what I said a couple of days ago when I titled my post God Help us All.

Housekeeping notes;

I was stopped out of my APOL position this morning at $72.60 for a gain of just over 10pts on 1 unit long.

I am raising my stop on my long SDS position to basically break even at $80.36. Defensive yes must we must remember to never underestimate the hope and denial of a savaged long only investing public and pension community.

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

Open Positions:
Long 1 unit Ultrashort S&P500 ticker SDS @ $79.90 stop @ $80.36
Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $42.17
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

Thursday, March 19, 2009

Charts of SPY, TLT, and TBT




Just a reminder to all the March Madness basketball junkies out there, please make sure your brackets are filled as the action commences just after noon EST today.

I will be a fixture in front of the television and you should too, must see television for sure.

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

Open Positions:
Long 1 unit Ultrashort S&P500 ticker SDS @ $79.90 stop @ $75.58
Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $42.17
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $72.54
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

Punting the S&P 500 and the Long Bond

I am getting long 1 unit of the Ultrashort S&P500 ticker SDS here at $79.80 with a stop at $75.58 based on what looks to be a double top on the SPY 60 minute chart.

Basically I am prepared to fade this smoke and mirrors rally.


I am also prepared to punt the long bond on the short side via the Ultrashort 20yr Treasury, ticker TBT here at $44.15 with a stop at $42.17

Charts on these will be posted ASAP.

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

Open Positions:
Long 1 unit Ultrashort S&P500 ticker SDS @ $79.90 stop @ $75.58
Long 1 unit Ultashort 20yr Treasury ticker TBT @ $44.25 stop @ $42.17
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $72.54
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

Wednesday, March 18, 2009

God Help Us All !

So the Fed stands at the ready to buy the bond market. The Fed has now become the buyer of last resort in a 'guaranteed to fail' stab at lowering rates to help the housing and credit markets. Whom might I ask do you think is going to hit this taxpayer led bid by the Fed in the bond market? God forbid they let them correct (housing/credit) of their own accord, instead they will gamble our nations survival ala AIG. These actions are no different than what AIG did writing policies they could not make good on. The implications of this disaster in waiting are almost too scary to consider. You would never know it by the bail me out of my positions crowd on Wall St.

Rumors have been making the rounds and Bloomberg is reporting that major brokers are calling in loaned shares for Citigoup (ticker C) used for short sales at the behest of the Fed, Treasury and the large brokerages. Anyone want to bet the over or the under on whether
the financials rally is just pulling a Volkswagen on us? Remember that short squeeze for the ages? If not I suggest you familiarize yourself quickly.

Just bear in mind that you can massage and manipulate, intervene and cajole but you cannot change the inevitable outcome, no matter how many shenanigans are deployed. Facts are facts and medicine that must be taken cannot be avoided.

I am not complaining in any way given I was short and the move has been against me but just don't be surprised as liquidity continues to dry up as players continue to pack their bags and leave a market whose principals have been long ago discarded. The same shenanigans by the same scoundrels that produced the mess we find ourselves in are being played again by the same vipers yet again.

Notice how all the interviews today are with the stock jockeys and very little input from bond and currency players. I would humbly suggest you watch the dollar and the bond market because a dislocation there will make what has happened in the stock market look like a day at the park.

P.S. You might want to pay some attention to Eastern Europe and all it's credit problems for they have not gone away no matter how much spin the financial media puts on this rally and no matter how many accolades the patronizing zombies on CNBC throw at Bernanke. Deja vu Greenspan anyone?

This bold move that the Fed is embarking on is being done at the a time when the Fed is in its most financially vulnerable position ever. It is like Fannie Mae right here and right now expanding its leverage 10 fold. The lunacy of this position will be revealed in the passage of time. The problem is that you and I are going to pay for it in ways many out there refuse to even consider.

Today is an enormous day, a huge day, a watershed day but not in the way most out there anticipate. I truly pray that I am wrong but I fear a massive U.S. government bond market dislocation lay directly ahead. Today you have irrefutable evidence that the Fed, the Treasury and the Administration are completely clueless.

Housekeeping notes;

Yesterday,

I was stopped out of my long SDS position at $85.35 for a loss of just over 4pts on 1 unit.

I was stopped out of my long SKF position at $132.80 for a loss of almost 4pts on 1 unit.

This morning,

I was stopped out of my long SRS position at $58.60 for a loss of just over 4pts on 1 unit long

I was stopped out of my long AAPL position at $100.15 for a gain of almost 2pts on 1 unit short.

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

Open Positions:

Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $72.54
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

Tuesday, March 17, 2009

Getting Short Financials

We look to be forming an inverted head and shoulders on the Utlrashort Financials ticker SKF. With a nice low volume pullback (right shoulder forming) from yesterdays high volume rally off the low (the head).

You could also view this on the XLF as a head and shoulders with today's rally being the low volume rise to form the right shoulder. The neckline looks to be about $7.90 on the XLF.

Based on this I am getting long 1 unit of SKF here at $136.55 with a stop at $132.91. I could be early but I am prepared to test the waters here.

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

Open Positions:
Long 1 unit Ultrashort Real Estate ticker SRS @ $62.75 stop @ $58.68
Long 1 unit Ultrashort S&P500 ticker SDS @ $89.45 stop @$85.38
Long 1 unit Ultrashort Financials ticker SKF @ $136.65 stop @ $132.91
Short 1 unit Apple ticker AAPL @ $102.05 stop at $100.11
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $72.54
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

Getting Short the S&P500

I am taking this opportunity to get short the S&P 500 via my preferred vehicle the Ultrashort S&P500 proshares ticker SDS here at $89.35 with a stop at $85.38


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

Open Positions:
Long 1 unit Ultrashort Real Estate ticker SRS @ $62.75 stop @ $58.68
Long 1 unit Ultrashort S&P500 ticker SDS @ $89.45 stop @$85.38
Short 1 unit Apple ticker AAPL @ $102.05 stop at $100.11
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $72.54
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

Monday, March 16, 2009

The Rally Continues



What does one say about the rally other than this is how markets function. They never go down in a straight line nor do they rise. Amidst all the hoopla and excitement of this rally I would remind readers that we are only working off a severely oversold condition and no matter how excited the financial media gets about this rally it is a bear market rally.

Please pay attention to the volume on many stocks, like for example GE (chart above). Notice how the volume in this rally is waning. This is not what you should see if the bottom is for real. I realize many equity players have extremely short memories but it would be wise to remember that we have just exited the mother of all credit bubbles which many seem to think all can be made well in the world by the magic wand of the Fed, the Treasury and the Obama Administration.

If you truly believe that the sins of so long manifested via this monster credit bubble can be worked off and over in 12-16 months, well then, and I hate to say this, but you deserve the fate that befalls you.

It has been said that you cannot save people from themselves and as much as I hate to agree with this it seems to be true.

One thing I have noticed is the number of seasoned market watchers who seem to be excited about calling a bottom here. I am astonished at the number and am baffled as to what they are watching to make such a prognostication.

I truly wish it were a bottom and I hope I am wrong but everything I am looking at point to no such thing. It would be wise to remember that it was the seasoned market professionals of the late 20's, who managed to escape the carnage of the first leg down in the debacle that was 1929, who got caught in the bear market rally and still suffered the same fate as their ill prepared retail prey.

You must also remember that all those hedge fund valet boyz, endowment and mutual fund robots are petrified of missing a market bottom, more petrified than losing money. Which should go a long way to telling you how your money is truly being managed.

As for the banks and their purported profits this quarter, (apologies to Vikram Pandit) we have not even begun to witness the commercial real estate write downs and credit card losses as yet. These write downs notwithstanding, the banks are in wonderful shape, right Larry Kudlow? even if they are insolvent by all sane measurements.



Housekeeping notes;

Late Friday I was stopped out of my long UCO position at $7.75 for a loss of just over a 1/4 pt on 2 units.

This morning I was stopped out of my short GOOG position at $328.60 for a loss of just shy of 3.5pts on 1 unit short.

I was also stopped out of my long SKF position at $132.25 for a loss of just over 5pts on 1 unit long.

I was also stopped out of my long EFU position at $122.45 for a gain of 32.5 pts on 1 unit long.

I am lowering my stop on APOL to $72.54

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

Open Positions:
Long 1 unit Ultrashort Real Estate ticker SRS @ $62.75 stop @ $58.68
Short 1 unit Apple ticker AAPL @ $102.05 stop at $100.11
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $72.54
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20


Friday, March 13, 2009

Short Google Yet Again.

I know this may sound crazy but I am jumping back into my GOOG short here at $325.4 with a stop just above the days high at $328.52.

I am having some trouble downloading the chart to blogger but suffice to say there is a bearish engulfing candle on the 60 minute chart this morning. I am placing my stop just above the high of that bearish engulfing bar.

Note the bearish engulfing bar occurred right at a descending trend line touching the prior 2 highs of $380 and $352.50 back in February.

Housekeeping notes;

I am raising my stop on UCO to $7.78 just as a defensive measure.

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

Open Positions:
Long 1 unit Ultrashort MSCI EAFE ticker EFU @ $89.80 stop @ $123.28
Long 1 unit Ultrashort Financials ticker SKF @ $137.35 stop @ $132.33
Long 1 unit Ultrashort Real Estate ticker SRS @ $62.75 stop @ $58.68
Short 1 unit Apple ticker AAPL @ $102.05 stop at $100.11
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $82.95
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Short 1 unit Google ticker GOOG @ $325.30 stop @ $ 328.52
Long 2 units Ultra DJ Crude ticker UCO @ $8.05 stop @ $7.78

Getting Long SKF and SRS Again

I am using the inordinate strength in financials and shares in general to get short the financials once again via the Proshares Ultrashort Financials ticker SKF. I am getting long 1 unit of SKF here at $137.25 with a stop at $132.33

I am also venturing back into the Ultrashort Real Estate ticker SRS here at $62.65 with a stop at $58.68


Housekeeping notes;

Yesterday, I was stopped out of my short GOOG position at $324.70 for a loss of just shy of 8pts on 1 unit.

I was also stopped out of my long SDS position at $93.40 for a gain of about $23.5 pts on 1 unit.


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

Open Positions:
Long 1 unit Ultrashort MSCI EAFE ticker EFU @ $89.80 stop @ $123.28
Long 1 unit Ultrashort Financials ticker SKF @ $137.35 stop @ $132.33
Long 1 unit Ultrashort Real Estate ticker SRS @ $62.75 stop @ $58.68
Short 1 unit Apple ticker AAPL @ $102.05 stop at $100.11
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $82.95
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Long 2 units Ultra DJ Crude ticker UCO @ $8.05 stop @ $6.78

Thursday, March 12, 2009

S&P 500 Chart


I wanted to bring your attention to the S&P 500 (chart above). The pennant or triangle formation that brok down a few weeks ago is still in play. Please note that we broke down from the 825 level. Now if we take he triangle at its widest part, it looks to be worth approximately 275 pts, which if subtracted from the break down level of 825, offers us with a target of 550 on the S&P500 index.

I know this sounds very far fetched to the "stocks are cheap" crowd but if we have learned anything we have learned to never say never.

I bring this chart up as something to keep in mind the next time an armchair pundit or guru tells you the bottom is in.... yet again !



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

Open Positions:
Long 1 unit Ultrashort MSCI EAFE ticker EFU @ $89.80 stop at $123.28
Long 1 unit Ultrashort S&P500 ticker SDS @ $69.80 stop @ $93.42
Short 1 unit Apple ticker AAPL @ $102.05 stop at $100.11
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $82.95
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Short 1 unit Google ticker GOOG @ $316.95 stop @ $324.61
Long 2 units Ultra DJ Crude ticker UCO @ $8.05 stop @ $6.78

Mark to Market Once Again

The rhetoric on mark to market is getting louder and louder. I happened to catch Art Cashin this morning on CNBC defending the argument to suspend or remove mark to market under the guise that just because the guy down the street has to sell his house at a depressed level doesn't mean you need to come up with more money to reflect that lower value.

Does Mr. Cashin really believe his analogy to be an appropriate one? Does he believe this is really the issue? I have a sneaky suspicion Art has fallen victim to the virus of "stocks are cheap" and is now long stocks and finds himself under water.


Art, I need to ask you is GE trading down here where it is because of mark to market accounting or because GE refuses to mark their book to market? The market has woken up to the games they play and now sees that GE's books (financials in general cannot be trusted) do not refect ANYWHERE NEAR current market value! Let me rephrase that, GE's carrying values for assets are not even in the same ballpark as to current market value.

I have the utmost respect for Art Cashin, he is wisened beyond words but he is not immune to emotion. Like many traders out there, one can get emotional or attached to his stance especially a losing one. Mr. Cashi may really believe stocks are a buy, he may be correct that stocks are undervalued, but does he really believe suspending or eliminating mark to market going to fix what is wrong or only pry one out of a bad trade.

I have no doubt that the mark to market abolitionists like Steve Forbes, Bill Issac, and Larry Kudlow will have their way for it tis the way things work. We will eventually realise it has done nothing to address the underlying problems, which these cats continue to obfuscate and be in denial about, and move on to the next comestic repair job.


Students of stock market history are well aware that after the first leg down in the debacle of 1929 we had a massive bear market rally that sucked in the professionals. The 'smart money' of the day got long stocks and the next leg down that took the Dow ultimately down 90% and were wiped out. I am keeping a watchful eye for this type of scenario to repeat once again, mainly as self-preservation so I do not get caught in it !!

The equity market has finally woken up to the fact that the financials are not what they say they are. The books they keep are fantasy and this is under mark to market accounting. rules. These rules HAVE ALREADY BEEN CIRCUMVENTED as they have off balance sheet vehicles holding worthless junk along with level 2 and level 3 assets of which we have to take their word on their value.

The fact that the politicians are clamoring all over this mark to market issue should tell you all you need to know about it. Do you really think they have a clue as to what will fix this. The fact that the all the aiders and abettors of the market shenanigans are all for it should be argument enough against. I am shocked at the number of purportedly free market capitalists and libertarians out there who are for it.

It truly is funny how a losing position or an under water account or portfolio performance can color you thinking and your policy stance. Pathetic.

You can stop right there with your flag draped, patriot driven claims that this is extraordinary times requiring extraordinary measures. The country, it's rules, its constitution, and its people are above window dressing maneuvers and deserve better than that.


The capital markets deserve better, the country deserves better, the public deserves better.


Housekeeping notes;

I was stopped out of AMZN late yesterday at $68.50 for a loss of just over a pt on 1 unit short.

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

Open Positions:
Long 1 unit Ultrashort MSCI EAFE ticker EFU @ $89.80 stop at $123.28
Long 1 unit Ultrashort S&P500 ticker SDS @ $69.80 stop @ $93.42
Short 1 unit Apple ticker AAPL @ $102.05 stop at $100.11
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $82.95
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Short 1 unit Google ticker GOOG @ $316.95 stop @ $324.61
Long 2 units Ultra DJ Crude ticker UCO @ $8.05 stop @ $6.78

Wednesday, March 11, 2009

Getting Short Google Inc.- GOOG


An exchange with a reader (thx D.M.) brought my attention back to Google. The picture on Google, ticker GOOG (chart above) shows a multi-month bear flag that has broken down and is now rallying into the underside which should serve as significant resistance.

I am using the current rally to get short 1 unit of Google here at $317.05 with a stop at $324.61.



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

Open Positions:
Long 1 unit Ultrashort MSCI EAFE ticker EFU @ $89.80 stop at $123.28
Long 1 unit Ultrashort S&P500 ticker SDS @ $69.80 stop @ $93.42
Short 1 unit Apple ticker AAPL @ $102.05 stop at $100.11
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $82.95
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Short 1 unit Amazon ticker AMZN @ $67.45 stop @ $68.47
Short 1 unit Google ticker GOOG @ $316.95 stop @ $324.61
Long 2 units Ultra DJ Crude ticker UCO @ $8.05 stop @ $6.78

Getting Short Amazon.com


A potential double top seems to be forming inside this powerful, well defined channel off the November lows on Amazon, ticker AMZN. I am using this strength to get short 1 unit of Amazon (chart above) here at $67.35 with a stop at $68.47.

Housekeeping notes;

Yesterday I was stopped out of my SRS position on the gap down. 1 unit at $91.00 for a gain of $37 pts and the 2nd unit at $75.40 for a gain of just over $21pts.

Today I was stopped out of 1 unit of my SDS position at $98.55 as it gapped down for a gain of about $28 1/2 pts on 1 unit.

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

Open Positions:
Long 1 unit Ultrashort MSCI EAFE ticker EFU @ $89.80 stop at $123.28
Long 1 unit Ultrashort S&P500 ticker SDS @ $69.80 stop @ $93.42
Short 1 unit Apple ticker AAPL @ $102.05 stop at $100.11
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $82.95
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Short 1 unit Amazon ticker AMZN @ $67.45 stop @ $68.47
Long 2 units Ultra DJ Crude ticker UCO @ $8.05 stop @ $6.78

Monday, March 9, 2009

Punting Long 2nd unit of Crude.

As per my notes on Friday it was my intention to get long a second unit of UCO on a move up thru $8.25. This morning UCO has done this and I was filled on a 2nd unit long of UCO at $8.30 which now gives me 2 units at a cost of $8.05. Now lets see this close above here and I will be a much happier camper.

I will leave my stop alone for now.


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

Open Positions:
Long 1 unit Ultrashort MSCI EAFE ticker EFU @ $89.80 stop at $123.28
Long 2 units Ultrashort S&P500 ticker SDS @ $69.80 stop @ $93.42/100.22
Long 2 units Ultrashort Real Estate ticker SRS @ $53.80 stop @ $75.42/92.87
Short 1 unit Apple ticker AAPL @ $102.05 stop at $100.11
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $82.95
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Long 2 units Ultra DJ Crude ticker UCO @ $8.05 stop @ $6.78

Friday, March 6, 2009

Punting Crude Long

The chart of the U.S. oil fund, ticker USO (chart above) shows a possible bottom. As my notes indicate we have made a higher low and then gapped up (on volume) with the gap now open 3days. I am using this strength, the lull is volume the past 2 days, and the fact the gap is now open 3 days to get long 1 unit of crude. I will do this via my preferred vehicle, the Proshares Ultra DJ crude, ticker UCO, here at $7.70

It is my intention to add a 2nd unit on a move above $8.25 and preferably a close there.

Housekeeping notes;

I am moving my stops up on SRS to $92.87 and $75.42 respectively.

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

Open Positions:
Long 1 unit Ultrashort MSCI EAFE ticker EFU @ $89.80 stop at $123.28
Long 2 units Ultrashort S&P500 ticker SDS @ $69.80 stop @ $93.42/100.22
Long 2 units Ultrashort Real Estate ticker SRS @ $53.80 stop @ $75.42/92.87
Short 1 unit Apple ticker AAPL @ $102.05 stop at $100.11
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $82.95
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Long 1 unit Ultra DJ Crude ticker UCO @ $7.75 stop @ $6.78

Thursday, March 5, 2009

Quick Note


I received an email from a reader, (thx R.T) asking the following,

"I noticed Bill Fleckenstein has recently closed his short fund, Marc Faber has said we are due for a big bounce and that Robert Prechter thinks the same. Do you think you are pushing the envelope too far staying short? "

Well, first off no one and I mean no one knows where the absolute top or bottom tick will be cept' the Big Fella upstairs. I have the utmost respect for the 3 mentioned pundits you have noted as they do much homework, are 'students' of the market and march to their own drummer, unlike the daily dose of hacks you see on CNBC.

I wholly recognize that all the oscillators and ancillary indicators that these men follow are all severely oversold and are screaming for the market to bounce. The problem is we are not, which tells me that when you cannot bounce from a severely oversold state you can crash. They seem to have goosed the rally yesterday with the rumors of a suspension of mark to market accounting.

Hear this once and for all, no matter what the landscape of laureates like Steve Forbes and Bill Isaac say,

you want to put a stake in the heart of what little semblance of propriety, honesty, and integrity our capital markets may have left, then suspend mark to market accounting !


I believe the short bus riding equity boyz are finally waking up to what is reality. I continue to believe that if you ask 20 of your friends, associates and relatives if they have sold out their positions (re: IRA, 401k accounts) no more than 4-5 have done so and until that number sits at 16-18 we will be nowhere near a bottom.

I have my stops in place to protect myself against the manipulations like that which we saw yesterday. These manipulations and chicanery are done, if not with the direct involvement of the Fed and Treasury and SEC, then with their tacit approval of simply looking the other way while it goes on.


I have also learned through experience that listening to others can sometimes cloud your judgement. I would rather, in this particular instance, hang on too long and give some back, rather than exiting early, based on these 3 wise men's opinions, only to see the market do what MY ANALYSIS thought it would do. Simple translation, I would rather lose on my own hook than win on theirs so to speak. The fact that they are shouting a warning means I continue to check and re-check my charts, my stops everything, I may have been on DEFCON 2 but now with their admonitions I am on DEFCON 1

Sorry for being so long winded but I hope this answers your question R.T.


I would like all the Fed defenders and apologists, of which their are legions, to read this article detailing how the Fed is continuing to refuse to release data surrounding the AIG bailout. I consider it exhibit #213 of evidence that the Fed and Treasury are part of the disease not the cure.


Housekeeping notes;

Yesterday afternoon I was stopped out of 1 unit of my EFU position at $136.25 for a gain of just over $46 pts leaving me with 1 unit.

This morning I was stopped out of my 1 unit long ICO position at $1.47 for a loss of about a nickel on 1 unit.

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

Open Positions:
Long 1 unit Ultrashort MSCI EAFE ticker EFU @ $89.80 stop at $123.28
Long 2 units Ultrashort S&P500 ticker SDS @ $69.80 stop @ $93.42/100.22
Long 2 units Ultrashort Real Estate ticker SRS @ $53.80 stop @ $64.72/75.42
Short 1 unit Apple ticker AAPL @ $102.05 stop at $100.11
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $82.95
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20

Wednesday, March 4, 2009

Fighting the Flu

My apologies for not posting yesterday as I was under the weather fighting the flu.

I happened to catch CNBC's morning show Squawk Box yesterday morning. They had on Ace Greenberg, the founder of AIG, along with Eric Hovde a fund manager whom I don't know but seems knowledgeable. The conversation took an interesting turn when the subject of making whole AIG counter parties was brought up. Mr. Greenberg and Mr. Hovde both brought up the fact that Goldman was at the table for the meeting with AIG, the FED, treasury.

Regular readers know I have brought this issue up before and know how hot under the collar I get about it. I realize men like Art Cashin want us to move on and heal but I can assure you that until issues like this AIG/Goldman one are resolved we are going nowhere. At least now this issue is getting some "air time" so lets see where it goes. Maybe just maybe King Henry (Hank Paulson) will be held accountable for his chicanery.

The Markets.

Monday was a 300 pt down day. Yesterday they tried to rally the market, marking it up almost a hundred points only to finish the day down about 40. I realize all the pundits are calling for a rally as we are severely oversold but one must remember that the market can remain overbought or oversold much longer than you or I can remain solvent. The chatter of the Steve Grasso "rip your face off" rally is getting larger but one must realize that after a 300 pt down day and all we can manage to do is an intraday rally only to finish down 40, well I humbly suggest you govern yourself accordingly.

I would also counsel that readers pay close heed to the volume in the markets, in particular the fact that the volume is normal to light. Good you say? I would disagree as this is not how a bottom will be made. This lack of volume makes me worry that instead of a ripping rally that something that this is the quiet before the storm and that something VERY BAD to the downside is brewing.

Did you catch the Hartford Financial (ticker HIG) news? If not take a minute to do so as they look to be headed down the road to insolvency.

Housekeeping notes;

I am once again bumping some stops up as follows.

I am raising my stop on 1 unit of EFU to $136.34 while keeping the 2nd unit stop at $123.28

I am raising my stop on 1 unit of SDS to $100.22 while keeping the 2nd unit stop at $93.42

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

Open Positions:
Long 2 units Ultrashort MSCI EAFE ticker EFU @ $89.80 stop at $123.28/136.34
Long 2 units Ultrashort S&P500 ticker SDS @ $69.80 stop @ $93.42/100.22
Long 2 units Ultrashort Real Estate ticker SRS @ $53.80 stop @ $64.72/75.42
Short 1 unit Apple ticker AAPL @ $102.05 stop at $100.11
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $82.95
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Long 1 unit Int'al Coal ticker ICO @ $1.51 stop @ $1.47

Monday, March 2, 2009

Some Stop Management

Watching Mario Gabelli and Bob Doll on CNBC this morning inspired me to write this short post. Rather than babble on as these so-called pundits on CNBC do I thought I would mention just a couple of salient points.

In my opinion we are nowhere near a bottom so long as cats like Doll, Gabelli, Farrell and Company continue to call for one. What I am absolutely shocked is that no one on the Panic network, (yes I know I call it the pom pom network, but given the state of GE's stock price, and the overall equity market I can assure you that it is in a state of transformation to panic !), has the guts to ask these gurus what their uncle point is.


You know, the point where you swallow your pride, and humbly admit you are wrong. I realize that this concept is not taught at any of the elite business schools of this country as failure is for losers. Please don't hold your breath waiting for these guys to admit error as they have made fortunes living off the crumbs of others and need public participation in the markets, (which is called the 'greater fool theory' at those Ivy League schools), to keep them in good humor, and on the platinum donor alum list. Besides, the ego stroke at their age is to quote MasterCard, priceless ! You can bet the under on any of this happening as it would take a real financial journalist to ask questions like these and CNBC is in extremely short supply of those.


In these financial, masters-of-the-universe's world, being wrong and wealthy is much more important than correct and poor. I am so sick and tired of the shameless pumping and cheering as the ship is sinking that I want to scream. Rest assured none of the above mentioned men will be left in the lurch financially as they are too shrewd to get caught in the vise that awaits their legions of followers.

To0 harsh?

Too acrimonious?

Possibly, but I more than welcome any rebuttal to my diatribe from above mentioned financial royalty or their yes-men, degree laden clones.

To those still listening to these shills, what can one say except just keep buying stocks. Double down. Better yet, focus on those those juicy dividend paying stocks. Those same ones where the CEO tells you over and over (a la Jeff Immelt) that the dividend is safe just before it gets hacked. Just be sure you factor what the dividend yield is when the payout is chopped by 1/2 or 3/4 or worse is paid out in stock. Kinda like those IOU refund cheques to taxpayers in California.


Oh yeah, before I forget, some stop management.

Housekeeping notes;

I am moving up my stop on 1 unit of SDS to $93.42 while keeping the 2nd unit at $83.28

I am moving up my stop on 1 unit of EFU to $123.28 while keeping the 2nd unit at $114.78

I am moving up my stop on 1 unit of SRS to $75.42 while keeping the 2nd unit at $64.72.


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

Open Positions:
Long 2 units Ultrashort MSCI EAFE ticker EFU @ $89.80 stop at $114.78/123.28
Long 2 units Ultrashort S&P500 ticker SDS @ $69.80 stop @ $83.28/93.42
Long 2 units Ultrashort Real Estate ticker SRS @ $53.80 stop @ $64.72/75.42
Short 1 unit Apple ticker AAPL @ $102.05 stop at $100.11
Short 1 unit Apollo Group ticker APOL @ $82.95 stop @ $82.95
Short 1 unit Microsoft ticker MSFT @ $19.20 stop @ $19.20
Long 1 unit Int'l Coal ticker ICO @ $1.51 stop @ $ 1.47