18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
23,599 Blog Posts

Semis Corrected: What Are You Waiting For?

So many of you clamored to own $NVDA and $ASML and all of the other great semiconductor stocks during the run into record highs. Over the past week the SOXX fell by a staggering 10% and now many are reticent to step in and buy the dip. This is the nature of most traders, trend followers to their core, unable to based their investments on any fundamentals due to the recent popularity of technical trading.

A look at the carnage in the semis the past week:

$ASML -17.9%
$MU -14.5%
$RMBS -12.2%
$SGH -17.3%
$ENTG -11.8%
$AMAT -14%
$LRCX -14.5%
$MKSI -12.7%
$NVDA -9%
$TSM -11.5%
$AMD -16.5%

So is everything cheap now?

That’s the median price to sales ratio for the second largest semi subsector, presently trading at a 60% premium to last year. Moreover, if the semis were to once again attain a p/s of 3.79 we’d need another 37% drop in the sector and if to attain the 2.9 average dating back to 2008, we’d need a 53% courrection from Friday’s close.

But what about AI and what about Bitcoin?

Contrary to popular belief, the growth in the semis is really isolated in $NVDA and Nvidia alone. No other major semi has enjoyed the growth that is being seen in $NVDA and they’re all just riding off its coattails at this point.

Happy Hunting!

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Semis Cap Off the Week with a Crash

All of you catamites who dove in at the highs last week are now swinging from your ascots. The rally that should have been was not and all of the tech bros were dispatched into the frenzy of a second Trump administration. Banks and homebuilders rallies and tech crashed through the fucking floorboards.

For the week the gay heavy NASDAQ shed 4% with 10% losses in the $SMH. The semis, which were up 10% for July, is now down by 4.5%. This is what pain looks like and if you’re heavily margined into the fires, you will be baptized.

I closed the week +175bps, even edged out gains of +22bps today, as I am a consummate professional especially during times of tumult. I will have you know that I posses no hedges into the weekend and feel that a mean reversion lift might occur on Monday.

The impetus for this is simple: although stocks are pricy there isn’t any news of the material nature to warrant further deterioration.

Have a good weekend fucked faces. If you find yourself too retarded to trade well, join Stocklabs and BEHOLD greatness.

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Crowdstrike “Update” Nukes the Planet

Late last night or early this morning, communications on a global scale went offline. The culprit was Crowdstrike, the super sketchy CIA rooted cybersecurity outfit that helped the DNC investigate “Russiagate” against Trump.

Hours after the issues started to emerge, CrowdStrike CEO George Kurtz issued a statement about the outages, saying the company has found a “defect” in an update for Windows that it issued. “This is not a security incident or cyberattack,” Kurtz said. “The issue has been identified, isolated, and a fix has been deployed.” In the statement, Kurtz confirmed that Mac and Linux hosts are not impacted by the update and said that its customers should refer to its support portal.

A Microsoft spokesperson also issued a statement saying it is aware of the problems linked to Windows devices and the company believes a “resolution is forthcoming.” At the same time as the CrowdStrike issues emerged, Microsoft was also dealing with its own, apparently unrelated, outage of its Azure cloud services.

The outages could result in “millions” being lost by organizations impacted who have had to halt their operations or stop business, says Lukasz Olejnik, an independent cybersecurity consultant, who says the CrowdStrike update appears to be linked to its Falcon Sensor product. The Falcon system is part of CrowdStrike’s security tools and can block attacks on systems, according to the company.

Because Crowdstrike is dominant everywhere but China, all railroads, airports, and even healthcare facilities saw their computers go full blue screen, aka blue screen of death (BSOD) until order could be restored. It just goes to show you how things are so delicate, that in one instance we’re back to analog trying to count money manually without machines. This doesn’t seem very efficient; but here we are.

Markets did not like this crash one bit and futures tanked last night, sort of recovered by the open, but here we are again spiraling lower. It has been a bad week for stocks with volatility back in the drivers seat. I am trying to hang on to some gains, now up just 10bps. I had been up around 50bps; but the hourly slides have been relentless. Here are the hourly returns for the $QQQ over the past two weeks, courtesy of Stocklabs. Notice how badly is sucks.


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Thoughts on the RNC Convention

Placing my feelings aside, the purpose of the convention wasn’t to be revolutionary and the Trump admin part 2 isn’t going to be the great change that anyone on the right wanted. This was a carefully crafted campaign to mold an image of Trump as this grandfatherly, harmless, kind old man. Gone is the acerbic Trump with threats to Mexico and whoever fucked with America’s interests. The only controversial thing he said was that President Bukele of El Salvador was emptying his prisons and sending them here.

If you wanted to win an election this is exactly the sort of convention you run and that’s the deal Trump made: power for his compliance. It’s really that simple and if you were looking for substantive change, you’re not going to get that with Trump 2.

If you love Trump the person and the character, you won via this convention. It rocked zero boats and made staid commitments, in what only can be construed as an out of date and out of touch movement by a party that is supposed to represent the right wing.

Here is the truth: the right wing nationalist do not have representation in America. You have no party to vote for and no hope for change. Is it all horrible and heading wayward down into the depths of hell? Well, that all depends on your level of acceptance to change and how unhappy you are with the status quo because that’s exactly what we are going to get.

America isn’t an idea, but an amalgamation of people who engineered a land of dense forests to make mega cities and the strongest economy the world had ever seen. You cannot deny there is a certain genetic heritage to the founding and success of a people and that is changing now, in Europe and here.

Wake me up when something interesting happens.

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Whirlwind of Selling Underway

It had the appearance of a rally at the open, although tepid and I suppose that was the tell. Following yesterday’s rout we inched higher this morning and whenever that happens, it’s only a matter of time when the weak hands acquiesce to raise cash and then it all comes tumbling down.

The semis are down 10% from their highs, officially a correction. However, those highs are still extraordinarily higher than any previous bull run. We now are betwixt several prevailing narratives:

1. The current President of United States has dementia and will not step down.
2. The presumptive President has policies that were good in the previous administration for the economy, bullish for oil, banks, and retail: domestic oriented names.
3. Confidence has been fractured. We are not in panic mode but the beginnings of what might be a market rout is underway.

I had a 22% $SQQQ at the open and ended selling it for minor gains, while it was down. I have since reaquired half the position and gave up any gains that I had early on, now off by 115bps. The urge to sell short is palpable and it’s always very alluring, the idea of a comeuppance stemming from decades of frustration with the ruling class. I sometimes forget my entire fortunes are intermingled with the exchanges and if being honest I’d risk it all just for the satisfaction of wreaking havoc on this system of perfidy. Alas back to reality, this is only a minor blip in a larger never ending ride higher, fueled by cheap and accessible credit, hegemony, and technological innovation unmatched from anywhere else in the world.

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We have the gameplan and you can see it as clear as the water is blue. If you look at what worked in November of 2016 when Trump got elected there is a very specific theme, one that has been picked up by professional money managers now, in attempting to price in a Trump win.

I am sure my colleagues will be angered at me for allowing the Third Estate in on our gambits, but I am a kind and generous person and you deserve money too.


$XLF +14%
$KRE +20%
$XME +22%
$IWM +11%
$UUP +3.3%

Let it be noted, the theme for a Trump victory in 2016 was domestic focus (i.e., small caps $IWM) and a strong dollar and soaring bank stocks and materials. Stocks like $CLF jimmied higher by 60%. There was a palpable disdain for tech and globalist companies, which is why the $QQQ traded FLAT for the month. In other words, there was an 1100bps spread between the two indexes and you can see that manifesting itself now.

Today was a terrible day and I’m afraid there might be a little more selling before we bounce. But we are also pricing in a totally different political reality, one that does not favor BIG TECH and one that might be more conducive with American industrial projects, defense, and demand for oil and materials.

I closed the day down 147bps, now hedged with a 22% weighted $SQQQ position.

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Markets Are Pricing in Trump’s Wrath

Whether it’ll happen or not, the market is most certainly punishing all of the homosexual tech companies who’ve enjoyed peace and prosperity under the censorship friendly Biden regime. You can see it in the shares of $META, barreling lower by 5.5%. There is something to be said about retribution and the fact private prison stocks like $GEO have gone up since Trump dodged assassination.

We are also seeing in the shares of $TSM and I suspect you’ll start to see Trump plays emerge in the tape the closer we get to the elections. Right off the bat, we are seeing banks soar, deal houses, tobacco, oil and residential construction. For example, the entire regional banking sector is +15% the past week and the homebuilders are +14%. We are also seeing gains in industrials, rubber, auto dealerships, machines and tools, farm equipment, and transports.

On the downside is tech, copper (china), and Chinese stocks.

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Good day,

I speak to you once again from the future. About a week ago I issued warnings about the semiconductor index and foretold what is transpiring today.

“Well it didn’t and as much as I like $NVDA and all of the other supporting actors in this bubble; it’s going to fucking crash through the floorboards one day and suck the entire god damned market with it.”

At the time of that post the $SMH was +7% for July and now it’s down. Any questions?

Today’s melee is partly due to Trump saying Taiwan ought to be paying America a fee for keeping them alive and partly due to an $ASML miss. But that’s a European company and no one actually pays attention to what Europe says or does. If you’ve ever been to Europe you realize almost immediately that it’s a giant museum with indigenous white people so cucked they’re importing Africans and Middle Easterners to replace them, probably out of boredom to be honest. All of the really smart whites were either killed in wars or moved to America to create the ultimate white super state called The United States of America, which is also being cucked due to various reasons we don’t discuss on this blog.

My point is, Europe isn’t a real concern when it comes to semiconductors or innovation. They don’t invent things anymore. They have decent cars and ok airplanes; but have you ever seen their laundry situation? Most Europeans still fucking airdry their clothes and their washer machines fit like 5 articles of clothing. Sometimes they’ll have the washer/dryer combo thing going on but it’s really bad and not designed for large families, which I guess makes sense because Europeans do not have children anymore. I suppose they’re superior to America with their bidets; but everything else is really just subpar and very menial. I don’t mean to be harsh or mean spirited with my European readers; but you really need to get your act together and start being great again.

I’m down 137bps into this complete collapse in the NASDAQ, which is down by 400. I have a 12% $SQQQ hedge in place and might consider adding to it late on today, depending on how the market develops.

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A Trump admin means more deals, means you ought to be long banks and deal houses like $BX, $LAZ, $GS, $MS and $JEF. I realize how suggesting to invest in the system whilst at the same time hating it and wanting it changed might seem contradictory; but alas this is my job and what I do.

It’s sort of like you, an auto mechanic or a T50 street sweeper, always angry and hiding things behind your blackened eyes. If curious as to what jobs best suit you, reference the chart below.

Grandpa Fly was blessed with A10 eyes and was always determined, no matter what he did. I, myself (pardon the redundancy), possess either A40 or A50 eyes, hard to tell since I am color blind. I offer true feelings and true meaning, both clean, white, and bright, all the way. While it’s true, I’ve known some T50s who were nice, I always felt they hid something behind their black eyes. What the fuck are you hiding over there, sneaking around with those T30s?

When peering into an A40 and up, you tend to be looking into the soul of a true and honest person: investors and philosophers.

At any rate, do not show this blog to Mrs Fly, as it might cause something of an upheaval at House Fly. It’s a good thing she never reads the olde blog.

Into tomorrow, 100% long and interested in more, as I am well deserving to receive maximum levels of success and aggrandizement.

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$IWM In Record Gain Range for July

It looks like the Russell will eclipse July of 2022 as its best July on record.

You can view it in two ways.

1. Markets have broken out and the risk is expanding into non tera caps.
2. We are extended near the maximum edge of the range.

If the latter, we are ebbing into men reversion territory. In other words, this “might” be a good spot to hedge of reduce risk. Admittedly, I don’t feeeeel like doing that because the gains feel good, as I am fully long +186bps for the session. However, you should be alerted to the idea that the gains enjoyed might dissipate soon, not due to any bearish news or change in sentiment; but merely based upon the laws of mean reversion.

On a longer time horizon, a Trump win is inherently bullish for markets because it boosts investor confidence. Big winners will be banks and oils, but main banks. Expect deals and lower rates, and a runaway ship into inauguration.

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