Setting Up For a Beatdown

The summer winds of reflation have sparked an epic short squeeze of Koranic proportions. Every manager with a series 7 license is buying Apple Inc. [[AAPL]] on margin, in order to celebrate Steve Jobs’ new liver. While I agree with many of the optimists, particularly on the topic of renewed economic growth, businesses are still struggling mightily alongside the average hamburger eating American getting poleaxed out of their pathetic jobs, with great vigor.

My target on the Dow, from the very beginning of this rally, has been 9,500 Dow, 1,000 S&P. Believe me, it is tempting to up those targets, rationalizing my long positions—while hoping for more. The reality is: at current levels, the risk/reward ratios are becoming unfavorable for a balls on the guillotine position. If you have big dicked gains, sell some stocks and go litter your local beach with empty beer vessels. If you are heavily short, down a fucking mile deep in losses, hang in there a little bit longer and average up on your positions.

Aside from the fact that the housing market is set to endure another round of ARM resets, the market always rapes market participants of their coin, during the months of September-November. Be smart; don’t be a jerkoff.

While on vacation, “The Fly” will not be executing any trades, no matter what. If people do not like it, they can go fuck themselves and find a new magician. However, when I return, I intend to bolster my cash position further (currently 32%) and look to initiate some short positions, especially in the banks.

See you dumb fuckers in about a week.