iBankCoin
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
18,471 Blog Posts

Chinese Momentum Stocks Lift Off Again and Explode

No one else is covering this, so I might as well.

There is nothing moving faster than these micro cap Chinese stocks now. The reasons for the explosion is nondescript, seemingly out of nowhere, and without cause. If I was forced to guess, I’d say this is some sort of scheme chalked up in Beijing in an effort to inflate prices of beaten down ADRs.

Here are some Chinese lotto winners.

PLAG +275%
NCTY +150%
CBAK +26%
SGOC +23%
FTFT +19%
CNET +17%
TKAT +17%
CPHI +16%
ATV +14%
AMCN +14%

And about a dozen more up more than 5%.

If you’re playing these, remember these stocks are illiquid and likely scams. What you’re seeing now isn’t material, only fashionable.

Comments »

Follow the Trail of Smoke for Extreme Profit

I bought back CGC and TLRY this morning. Both stocks are elevated, but look like they want to head higher. I’ve successfully traded these stocks numerous times and have never lost money in them. It’s pretty hard to lose money in a new sector that offers so much promise and extreme degrees of degeneracy.

By my vantage point, both TLRY and CGC are the best publicly traded pot plays, with NBEV being a speculative third.

Markets are of course strong and I’m stuck with SQQQ. I’ll hang onto it a little while longer, waiting for the afternoon session to determine whether I’ll cut it loose now or next week.

Comments »

Reminder: Markets Don’t Bottom on Friday’s

Good morning lads

I see markets are swimming higher, against the current, fishing out unsuspecting rubes to buy it here. Need I remind you the weekend is just around the bend and Monday might be an awfully terrible day. All sorts of insane things might happen. There’s no telling what Trump might say over the weekend.

Needless to say, markets don’t bottom on Friday, even if PG is higher by 6%.

Right now, like a true degenerate, I’m sitting here, sipping a scalding cup of black coffee, rooting for CPHI to jimmy higher. It’s making me nervous, because of its 30% swings. Alas life as a Chinese burrito.

Let me get settled in and have a better look at the market. I have a ton of cash, so if something looks ready to pop off — I’ll have no issues buying immediately, regardless of whether markets bottom on Friday’s or not.

Comments »

Goldman’s DJ Sol Says Program Trading to Blame For Market Sell Off

Quants, robo-advisors, HFT, and algorithmic based trading desks dominate Wall Street now. It’s has gotten so egregious, I literally base my investment decisions on how a quant would respond to sell off, the criteria it’d be interested in, and how negligent the programmers of said quant might be. Gone are the days when retail meant something to Wall Street. Trades are now done, based off AI, machine learning, and quantitative analysis. Certain triggered get hit, and a cascade of orders follow.

Goldman’s DJ Sol is out with a ‘duh’ moment, suggesting robots are to blame for the recent slide.

Source: CNBC

“There’s no question when you look at last week, some of the selling is the result of programmatic selling because as volatility goes up, some of these algorithms force people to sell,” Solomon told CNBC’s Wilfred Frost. “Market structure can, at times, contribute to volatility and one of the things that we’re spending a bunch of time thinking about at the firm is how changes in market structure over the course of the last 10 years will affect market activity.”

He continued.

“All those things are untested over any duration of time with severe stress,” Solomon said. “Now, when we see a little bit of stress, you can see reactions that might lead you to believe that there’s a risk that with more significant stress that could play a bigger role. I wouldn’t predict that, but it’s certainly something we watch.”

According to JP Morgan, as of last year, discretionary traders accounted for just 10% of trades.

Looking even deeper into quant trading, the high frequency varietal accounts for ~52% of all trades. That is literally the dumbest form of trader — the algorithm that rips trades to and fro in fractions of a second — with the goal of milking each trade for a small profit. Reminiscent of the scheme purported in the cult classic flick Office Space, those pennies quickly add up, and produce billions in profits to Wall Street’s top trading desk.

How profitable are these strategies?

Back during the hey day of HFT, 4 investment banks posted a record 61 straight days without a loss.

Even more perverse, and just to show you how the deck is stacked against the plebeian retail investor, JP Morgan lost money two days over 4 years.

Comments »

STRANGER DANGER: Gold is Defensive Again

I bought ABX today because gold is receiving institutional interest again. Now with China and cryptos destroyed, defensive nut cases have no choice but to barrel in sideways into gold. Over the past month, gold stocks have outperformed SPY by +15%.

I also bought some SQQQ, just in case we retest the lows — which is 200 Nasdaqs lower. There’s a lot of ‘just in cases’ in my moves, much to do with being restless, impatient, and impetuous. I am being petty — because my trading account is designated for trading. If it were a long term account, I’d snooze and watch teevee. But because I’m supposed to trade it — that’s exactly what I’m doing.

At the close, I was 60% cash, 5% SQQQ, and a fist filled with pleasantness.

Comments »

Cashing Out — Prepping For a Retesting of the Lows

This is the tedious part of dealing with Wall Street, them and their ridiculous traditions and habits and superstitions. Fine, we have to retest the lows. I accept that fact and will now prepare for that eventuality.

I cleared out of most of my SAAS plays and have raised cash to 70%. I did this because I want control over my positions and I do not want to be subjected to market swings, based on Saudi shenanigans or anything else for that matter. I am tempted to hide in cannabis or even gold and might take some positions today, if they continue to trend.

Comments »

I’M A CHINESE DRUG DEALER OVERLORD NOW

I was busy all morning doing a little of this and a little of that — then I gazed upon the Chinese sector and found it to be white hot. The overall tone of the market is fat and disgusting; but the Chinese part is very skinny and beautiful — like a nation of bicycle riders subsisting solely on a diet of vegetables.

It the came upon me like a bolt of lightening hidden in a champagne cork, I wanted to become one of them. So then I took to Exodus and sifted thru my “Chinese Burrito” industry and came upon a small piece of shit stock that had already doubled. I pressed upon it with great energy and inserted my will and force into it — and bought it.

I am now what that company does, a Chinese drug dealer, and it’s perfectly legal and fine. You cannot stop me.

I bought CPHI — because the MUH chart looks good.

And here is the overall Chinese Burrito sector, totally oblivious to the world around it.

zài jiàn.

Comments »

Here’s Why the Market Must Continue to Rip Higher — Everything Depends On It

Rarely discussed, corporate and government pensions, are barreling towards disaster. For some reason, there is an assumption that what ails the government, with their $20+ trillion in debt, isn’t something that ordinary folk need to worry about. After all, times are good and corporate stock prices are near record highs, people are working, and even wages have been increasing.

But beneath the shiny veneer is a sickness that is festering, a red nightmare of underfunded pensions, both on a government and corporate level. They menace over markets like an explicit threat, a promise of crisis that is both maturing and spoiling with equal violence.

Former Dow component, and once upon a time great American company, has an underfunded pension of $31 billion and a business that is in the midst of restructuring. The stock has been cut in half over the past year.

But at a time when General Electric Co. is facing what amounts to an existential crisis, a $31 billion deficit in its pension plan may complicate any turnaround that involves a breakup of the 126-year-old icon of American capitalism.

Divvying up the obligations won’t be easy. After all, GE owes benefits to at least 619,000 people. And retirees aren’t the only ones at risk. Ideally, breaking up a conglomerate as sprawling as GE would unlock value for shareholders, who have seen their stock fall 40 percent since the CEO took the reins from Jeffrey Immelt in August. Stronger divisions wouldn’t be dragged down by weaker ones, and each business would stand on its own financially.

 

Here’s a nice genteel list of the top corporate pension deficits in America.

The municipal deficit is far more insidious, $6 trillion in the hole.

And this from Wharton.

“It seems like there’s enough blame to point to everyone,” Mitchell said. “All of those different approaches proved wrong, especially after the financial crisis where state and local pensions lost 35% to 40% of their money. It’s true that things have been doing a little bit better in terms of their investments, but still the fundamental flaw is that over the years employees were offered a future benefit that was not properly collateralized.”

Mitchell said the problem is worsening because state and local governments have neglected to take corrective action.

“Every year that goes by leads to more red ink and more concern because the state and local plans across the country have clearly not done what they should have done to contribute the right amounts, to invest their assets in their pension plans carefully and thoughtfully,” she said. “Older folks are living longer and needing more medical care, needing longer retirement benefits. It’s a series of challenges that, frankly, nobody is paying much attention to.”

Mitchell and Friedberg warned that the pension hole will swallow public- and private-sector employees alike, because all income earners will pay for it. Mitchell ran a simple calculation to illustrate her point: If the shortfall were $5 trillion, divide that amount by the 158 million workers in the American labor force for an obligation of about $32,000 per worker.

The PBGC, which is a federal agency charged with protecting US pensions for firemen, cops, and municipal workers, have seen their deficits soar in recent years.

The Pension Benefit Guaranty Corporation’s Fiscal Year 2017 Annual Report, released today, shows that the deficit in its insurance program for multiemployer plans rose to $65.1 billion at the end of FY 2017, up from $58.8 billion a year earlier. The increase was driven primarily by the ongoing financial decline of several large multiemployer plans that are expected to run out of money in the next decade.

The largest pension fund in America, CalPERS, has ~$350b invested and have recently reduced cash from 4% to 1%, in an effort to perform better. Bear in mind, during the financial crisis the fund shed $100 billion, losing 24% in 2008 alone. The fund went from being 101% covered in 2007 to 89% in 2008.

With markets gleefully soaring since then, one would assume, even presume, the coverage ratio to be significantly higher, yes?

You’d be wrong.

In spite of stellar performance and robust contributions, pension funding is only 71%, up from 68% last year. The fund doubled its  projected return last year, netting 15.7%.

CalPERS investment allocation for 2017.

It’s widely believed that once pension coverage hits 50%, that is, in fact, the point of no return. It’d take a giant miracle of Warren Buffet proportions to make up such a deficit. With investment allocations at 28% fixed income, 50% equities, it’s damned near impossible to do.

According to Pew Charitable Trusts, the cumulative pension gap is ~1.4 trillion,  at just 66% coverage. Presently, there are 5 states in the union below the point of no return (50%).

Now if you juxtapose that against the $375b deficit on the corporate side, the corporates don’t look too shoddy. After all, their coverage for defined benefit plans jumped 4.7% in 2017 to 89.2%.

Bottom line: the situation at the most sacred investment funds in America are truly in dreary condition, far worse than during the financial crisis — thanks to ballooning obligations. Could you imagine if the market dropped by 30% in a year, what the situation might look like across the country?

Side addendum: Here in NYC, a veteran NYPD officer gets paid $110-$175k per annum. Once retired, said cop gets half that amount for life, including benefits. There are 38,000 cops in NYC and these insane salaries are the result of runaway cost of living increases in the city.

 

Comments »

Forge Ahead Young Man — Stocks Are Rich With Value

Today was a brief stop along the runaway locomotive which is bound to crash into a cave filled with bears — killing them all dead. I expect a resumption of the bull rally to parlay into your brokerage account starting tomorrow, lasting for another week or so, until the great retest of the 2018 market crash is upon us.

When it happens, you’ll be so scared, I gather you’ll soil yourselves ridiculous.

I sold two stocks, both for egregious sized losses, only saved by their small position size. I am 15% cash and I couldn’t get myself to buy Chinese lottery stocks today, in spite really wanting to.

I have a strong and powerful mind for this sort of market, a wonderful blend of shocking behavior and wanton gambling, mingled in with a little irrational mood swings. I’ve done very well this year, much better than you and everyone that you know, probably combined. When I used to manage money, on days like this I’d simply waste the day box watching, chatting with clients all day, talking about nonsense. Now I do the same shit, but on Exodus where I teach people what they need to be told and so on and so forth.

Time to head out now.

GOOD DAY.

Comments »

Chinese Boiler Room Stocks Jimmy-Rigging Higher

I don’t know what to make of this — perhaps another mania now that the weed trade has died down.

YECO is higher by 600% and several other Chinese material stocks, as well as financials, are shooting higher. These are stocks that normally trade 5,000 per day, now trading hundreds of thousands and millions. It looks like some boiler room broker won the fucking mega millions.

Other breakouts include: CNET, CIFS, GLG, SSLJ, PETZ, PLAG, CBAK, CHNR, HGSH, CLDC, OSN, TKAT, ABAC, SGOC, EVK, ATAI.

 

People are nuts.

Comments »