Thursday, January 21, 2010

Something is Rotten in Denmark

I realize being bearish posture of late makes me the classroom dunce. I also realize this proves for all to see that my IQ resides just slightly above room temperature. Given my circumstance I need an enormous favor.

In this vein, I would greatly, no.. .check that, I would strenuously appreciate someone explaining to me how we can get a market down 100 one day, up over 100 the next, then down 200 only to rally 100 towards the back half of the day, only to then be followed up by being down 150 the next day.

Yes, call me crazy for assuming a bearish stance in the face of rising job losses, rising emergency unemployment claims, rising home foreclosures and credit delinquencies.

The up and down part I get, what I need the help with is how we get a VIX below 20 in the face of this. Given my previously reported IQ, I have come to the simpleton conclusion or a least one that Shakespeare might have, that something is rotten in Denmark. Someone, other than Chuck Prince of the music's playing so we're dancing fame, please straighten me out.

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 Daimler ticker DAI @ $52.23 stop @ $54.81


Sean said...

Harley, we've been fighting the "dark side" for 8 months. The Fed and their agents have inflated the markets with manipulation of overnight futures because they're scared shi#@tless about pension funds and savings; also, by permitting companies to reflate, they can squirrel away for the next horrible downturn.

That's my story and I'm sticking to it.

Harleydog said...


hard to disagree, I continue to watch bonds as this mkt absolutely dwarfs the equity mkt in size.

Watch credit both int'al and more importantly domestic. Muni's are a disaster and this is where the bulk of pension savings are.


Sean said...

Harley, what do you watch for your canary in the coal mine bond and credit indicators?

Harleydog said...

Wow. no one holy grail but over the years have picked up many tidbits to follow... I am assuming you are looking for clues from this to the equity mkt.

I watch yield spreads mainly but also yields all along the curve with a host of other items ie. credit quality, etc. bond investors are very astute and very risk averse.

the bonds are like the wild life that head to high ground when a natural disasster is imminent while equities are like us humans walking out on the sand as the tide recedes !!!