Saturday, February 6, 2016
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Joined Nov 10, 2007
11,771 Blog Posts

Saturday Cinema with Le Fly: This is the End


This is a playful tale about real Hollywood actors, enduring the apocalypse. After last week’s trade, I felt my audience deserved to be entreated to this movie about the devil, flying dragons and Danny Mcbride as a cannibal warlord, who roams the earth in search of soylent green.

This is a really bad movie, but also hilarious. I envision the real end of the world will be exactly like this.


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This was a momentum memorial, laying to rest all of the cool kid stocks–causing the longs of those stocks to simply give up and capitulate.

Look at the losses amidst many of the favorites, like PANW, CRM and LNKD.




This comeuppance was inevitable. The playing field is in the process of being reset. In all market squalls, opportunities arise. The same narrative is being written now. At some point, there will be a series of sublime entry points; but we’re not there yet. If you recall what I said about 2008-2009, following a hard January, in both years February fell hard too.

If you’re looking to buy bargains, wait for February to mature and then take a stab when people are throwing themselves down open manholes.

To summarize my position: I have been 75% cash/25% TLT for a week. I am trading the oversold signals inside Exodus, exclusively now, with SPY being my weapon of choice. We’re not oversold yet–thanks to the intuitive nature of the algorithms. Having learned from the recent declines, the system’s oversold threshold is now deeper, which means stocks need to get really scary for it to spit out an oversold signal for the overall market.

It’s ridiculous to believe the Fed is still in play. The speculation game is cruel and unforgiving. But this Federal Reserve hawkish position is a gift, if you think about it for what it is. They’re telling you to sell stocks. Stop fighting the Fed and understand that having a robotic long only allocation is 2013 thinking. Get flexible or risk being eliminated from the playing field.

Cheer up. It’s only money.

Reminder: Get aboard the ark.

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Norovirus Confirmed: $BWLD Shares Are Cursed Ahead of the Super Bowl


You cannot have a worse case scenario, if you’re BWLD. It’s just one little bullshit store in the middle of nowhere in Kansas. But, one of your ADD addled teenage employees fucked up and now you have this as your headline ahead of the super bowl.


Here is the Johnson County letter.

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I realize TLT is down, off by 0.5% for the day. But it’s a whole of a lot better than owning LNKD in a margin account, isn’t it? There is still room on my ark, next to the buzzards and the beetles.

The Fed rate hike is BACK on the table, apparently. Thanks to this morning’s jobs numbers and comments out of Fed’s Mester yesterday, traders are selling their stocks and getting the hell out of dodge for one specific reason.


On one hand, you look at the shares of LNKD, DATA, LGF,  CRM, GILD, AMZN and many others, and ponder if satan himself is controlling the price action on the NYSE. Then you spin around and see this idiotic 4.9% unemployment rate and people like Jim Paulsen get on the teevee and do the Fed’s bidding and conclude there isn’t a reason to be long stocks.

If the Fed is working against you in the market, get out of the market.

There’s an old saying: ‘Don’t fight the Fed.’ It applies to both a bull and a bear case. Right now, there is an overwhelming amount of evidence, suggestive that this Fed intends to reduce the value of equities, for reasons that escape this unlearned man about the internets.

All I can tell you now is that this sell-off isn’t done. The Fed has lost the confidence of the market. It is being led by a person who is tone deaf. And you should fear what you don’t understand.


The NASDAQ is off by 120.

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This Man is an Idiot; Thinks March Rate Hike is Warranted


What sort of man goes on CNBC to declare the Fed should hike rates, after a catastrophic first month of trading and FX induced upheaval, without shaving the stubbles off his face?

His name is Jim Paulsen and he hails from Wells Fargo asset management.

While watching this clip, I became physically agitated and I threw things at my teevee. How in the world can this man get up there and say a March Fed rate hike is warranted and that everything looked good? Is he a fucking moron?

Shave your damned beard, for Christ’s sake.

The NASDAQ is down 113. Zerohedge is celebrating over the broken bones of investors.

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This Day Shall Live in Infamy: $LNKD, $DATA, $SPLK and Others Die


This is not a market for old men. LinkedIn is undergoing its largest single day drawdown ever–shedding more than $10 billion in market cap. On the software side, Tableau Software is off by 48%–taking with it the entire software space.


The carnage in tech today is surreal.

Here are some tech ETFs that own some of the above stocks: SOCL, HACK, FDN, IJV, PSJ

The Dow is now down nearly 150 and the NASDAQ 90.

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FANG Stocks Are Now Down 13% for the Year


Facebook +5%
Amazon -21%
Netflix -21%

The median return is -13.3% for the year.

Inside of Exodus, my bubble basket is at a new low, down 29% for the year.

There isn’t an iota of risk appetite left in the market, especially with this morning’s unemployment numbers. All of the assholes are calling for MOAR rate hikes–ignoring the fact that NOTHING in the market is working.

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It’s Getting Grizzly Out There; Software Stocks Have Been Destroyed.

qweekend Bunch of Five "Revenant" Leonardo DiCaprio Fights off the Bear

Stocks are falling this morning, after a solid jobs number and proclaimed 4.9% unemployment rate.

LinkedIn is suffering its worst decline ever, off by a retarded 37%. Big data enterprise company, Tableau Software, is off by a staggering 49% in early trade–taking with it the entire sector.

Check these losses out.

DATA -49%

CRM -9.5%

QLIK -14%

SPLK -16%

WDAY -10%

VEEV -5.2%

DWRE -8%

HUBS -7%

PANW -10%

FEYE -7%

CYBR -5%

The list is endless, really. I cannot recall a worse day for the software sector ever. Is it warranted? Yes. We’re in a bear market and apparently enterprise software is slowing, in an appreciable way. Thank heavens Fed’s Mester is out there, hiking rates, for the benefit of the American people.

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ArcelorMittal Shares Plunge on $3 Billion, in the Hole, Offering


The world’s largest steel producer is doing a capital raise, reminiscent of the banks in 2008, in the hole–dilutive, in order to reduce debt.

Shares are down 7% in Europe on the news.

Although demand in our core markets remained strong, prices deteriorated significantly during the year as a result of excess capacity in China,” Lakshmi Mittal said.

China, which makes half the world’s steel, exported a record 112 million tonnes last year, equivalent to total North American output, upsetting trade partners who argue it is dumping on world markets.

Steel prices have slid to 12-year lows and global steelmakers appear set for another year of pain even as steel prices start to stabilise due to production cuts.

EU ministers met last year to discuss Chinese overcapacity and the threat to EU industry, at the request of Britain where most of recent sector job cuts have taken place.

Along with the capital increase, the company said it was selling for 875 million euros ($979 million) its 35 percent stake in Spanish automotive steel specialist Gestamp Automacion to the majority shareholders, the Riberas family, ending a joint venture formed in 1998.

“This capital raise, combined with the sale of our minority shareholding in Gestamp, will accelerate the company’s debt reduction plans and enable us to reduce net debt to less than $12 billion,” Lakshmi Mittal said.

With the sale of Gestamp and the offering, debt will be reduced from $16 billion to just under $12.

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