One day before Bernanke shaves his beard on the market, stocks are ripping higher, with the notable exception of [[VMW]].
As you know, banks, homies and retailers have been leading the market, as crazy people deplete their checking accounts and “toss” them into egregiously bad sectors—for fun.
I must say, today’s durable goods numbers put a damper on the whole “we’re gonna die because we’re in a recession” thesis. Should we get strong employment numbers, later on this week, “The Fly” may have to “flip-flop” on you cowards and start buying stocks again.
Aside from the madness, I do like the refiners here, as they melt the fuck up. Right now, [[VLO]], [[TSO]], [[HOC]], [[WNR]] and [[ALJ]] have extreme momentum—thanks to VLO‘s kickass earnings report.
For a trade, take a look at [[DK]] for a sympathy bounce.
Within financials, finally, I found a stock worth buying: [[AIZ]], aside from [[CMO]].
In short, AIZ sells property insurance to banks who take possession of property, via foreclosure. So, as foreclosures rises, banks will be forced to buy property insurance, likely from AIZ.
A win-win for AIZ.
Finally, despite being tempted to average down on [[SKF]], I will wait until after tomorrow’s Fed meeting. There will be plenty of time to make money.”The Fly” finds no need to buy anything here, ahead of iBankCoin’s glorious “platinum party.”
UPDATE: I lied. I bought more SKF.
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mvis… mvis… 😉
mkt sells the fed tomorrow; mvis goes to 2.85. Assuming Bernanke even “meets” expectations, the guidance will suck for either the rate outlook or the earnings outlook.
Looking at 100 day charts of homies and banks, I can’t see them popping tomorrow unless there is a 75bps cut.
why does nobody think the bernanke could disappoint with only 25 bps. strong jobless claims, strong durables…..is this more than outweighed by the shitty housing stats? if the data are so good and the econ is not headed for recession then why is the fed cutting hundreds of bps and why is bush proposing $150 bn tax relief? The fed has access to all info they need and they obviously think the shit stinks.
yesterday the mkt supposedly rallied on bad econ data which increased confidence for 50 bps. today there is great econ data so doesnt that imply just the opposite…yet we are up.
i wouldnt be surprised to see a sell off this afternoon.
what do you make of CMO’s new offering?
… and all that ag nonsense is winding up. look at MOS volume dropoff. speculators should talk to more farmers before they start projecting moonshot prices on basic commodity chemicals.
If Bernanke does more than 25 the market will tank. We bottomed, exports and other sectors will more than make up for recession in housing. We bottomed and we’re going higher from here. Get long or be left in the dust, suckers.
I did a little research. The market for jumbo loans ( $417k +) has dried up. If you are looking to buy a million dollar plus home, you need to put 20% or need to have impeccable credit ( FICO 720+). Problem is most people don’t have 20% to put down on million dollar homes even if they can afford the homes. California has over 50,000 million dollar homes for sale on the market. No one is buying.
CONCLUSION: Short TOL. These guys build (semi)luxury homes in the million dollar price range. Nobody is buying. They won’t make a penny in 2008 and will eventually file BK.
Housing is an affordability issue, who’s going to buy a house that is historically way overpriced when you get statements like this from Fannie Mae
Fannie Mae CEO says US home prices should post a larger percentage decline in 2008 than 2007 – Reuters
I think they’re all just getting to the point of letting housing crash, let the politicians posture with plans that don’t help anyone and get 2008 overwith.
Steve, you are wrong. But keep shouting out those bottom calls.
I think a 50bp ease is baked into this here cake. Watch the feds language. If they hint, that the copters will be turned off, look out below. If as Fly says, that funky data being released over the next few days is market friendly, look out above … short term.
Why is CMO getting punched in the balls as the market rallies into a fed rate cut? Doesn’t add up. Think I am going to cut my losses as I was late to the party with this one.
Thou are mistaken oh little fly for I do not loveth banking stocks. What I loveth is to see thou pitiful sinning humans get excited about a Fed rate cut from Ben “Satan” Bernanke and drive up bad stocks because of greed only for me to smite them again with thy holy homo hammer of death.
God
Hey, asshat, show a little respect for the real God.
Juju Bear, so I see you are an infadel. You were never one of my favorites. I have a nice warm place for you one day.
Skiffles, how I love ya.
Skiffles, you’re my shelter in the storm.
Old man Stevie, how I shove ya…
Down the stairs, it keeps me warm…
Who knew “God” has such trouble with basic spelling?
And I always prefer the “Holy Hand Grenade of Antioch” when blowing up the mercenaries of Bernake… “in Thy mercy.”
When you’re feeling low and blue…
And psycho bulls are calling “Bottom!” —
Skiffles help to pull me through…
I’m so happy that I bought ’em!
After the announcement people will sell the news no unless the cut is a ridiculous .75bps or higher.
.25 and it will be a rapid selloff.
Sorry Jake for I get mixed up sometimes with all these silly human languages and grammar rules. As thou knowest I have more important things to do than spell checketh my blog postings.
“How does it work?”
“Consult the book of armaments.”
“Armaments, Chapter 2, verses 9 -21….”And St. Attila raised the hand grenade up on high saying, ‘Oh Lord, bless this thy hand grenade with which thou may blowest thine enemies to tiny bits….”
The Fly:
AIZ also insures autos and small businesses, which can negate the property insurance stream of revenue.
SKF, you think it will be $90-$95, the classic disappointment scenario on tomorrow’s Fed?
CAP:
Co-sign, however in the HB industry TOL has a decent balance sheet with CASH. Most of the others are balance sheet insolvent and are in real trouble. Take a look at LEN. These guys are just asking to get smacked around with the recent melt up.
yo, it’s gotta go up before it can crash… inflation leads to inflated prices, and that what you get when there’s people spending like crazy. Gonna take about 6 months for this rate cut to actually effect anything, and depending on that and what they do tommorrow, prices are going to rocket up… just don’t overstay your welcome when it happens!