Less Than Stupid Ways to Hedge
If you’ve been following me, over the past 6 months, you made an incredible amount of coin. Unlike most 3rd tier bloggers out there, “The Fly” is not beholden to any mantra or ideologies that may interfere in his coin making process. See folks, the stock market is a place where stupid people get together and make a bunch of errors and/or try to predict the future. Most of the time, the market is correct, only because civilization is constantly advancing. The market embodies all that we are, from faulty airplane rudders to bullshit cures for obesity.
When participating in the stock market, always remember, the friendly folks at the Federal Reserve have a vested interest in jolting it (the market) higher. So, you and your loser friends, declaring [[FAZ]] a buy on the first sign of weakness, are just wasting time and money.
During the credit crisis, the Fed lost control of the situation, as panic struck America, like the dumb stick hit Brooklyn 100 years ago. The crisis was exacerbated by the media drumming up news stories, which in turn coerced Americans to pull their money out of banks and stock up on rice and beans— Glenn Beck style. Don’t get me wrong, the losses were real and the banks were deserving of “death by homo hammer.”
But it didn’t happen and here we are, in the midst of the biggest melt up in stock market history. Ho-hum.
With gains north of 75%, I am not motivated to time any potential tops or catch some downside trades. For me, I find peace in having a big cash position and waiting for better entry prices on the long side.
If the market is going to correct, instead of hedging via [[FAZ]] , [[SRS]] , [[DUG]] or [[REW]] , why not buy dollars, via [[UUP]] or treasuries, via [[TLT]] ?
Look at the charts, bozo. It doesn’t take a rocket scientist to understand, when the market goes lower, dollars rise in value— as do treasuries. Granted, you may not make a gazillion dollars with this strategy. However, in the event you are woefully wrong and the market springboards into 2010, you won’t file for bankruptcy protection either, due to an erroneous, coke induced, trading strategy.
There are other softer ways to play the downside, which I will discuss later on next week.
50 Responses to Less Than Stupid Ways to Hedge
Thanks Fly
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from faulty airplane rudders
Is this a side swipe at one of my biggest holdings: Boeing? If it is it’s most certainly unappreciated. The Dreamliner will fly, Fly 
On a serious note, I still don’t understand why the US asset market rises and falls inversely to the buck. Don’t get me wrong, I’m not fighting that garbled relationship, but it doesn’t make any fucking sense especially not now after the crisis has abated and when dollars aren’t in a shortage as they were then.
A stronger buck normally should be singling demand for the buck from overseas while the opposite is true.
Don’t get. Will trade it that way, but really don’t get it.
The other thing to watch is that the Yen is strengthening which is pretty ominous for those flukers over there.
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That’s because Liver Lips Denninger is right, and the buck has become the carry trade short of choice.
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“Look at the charts, bozo.”
Where’s Fly?
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During the credit crisis, the Fed lost control of the situation, as panic struck America, like the dumb stick hit Brooklyn 100 years ago. The crisis was exacerbated (sic) by the media
“Ironic confluence.”
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Haynesworth hurt. Redskins “done,” and my vorpel blade goes snicker-snack.
That’s gotta help on the schadenfreude front, at least.
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It is spelled correctly you snarky little fucker.
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True, “exasperated” was spelled correctly. Spelling had nothing to do with the irony.
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spell check hell
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> It is spelled correctly you snarky little f*
Well, a good program that look at is Spell Check Anywhere (SpellCheckAnywhere.Com). It adds spell checking to all programs.
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Titties with the pickoff! They have a chance, if Coffin Stuffer Collins can avoid getting sacked to his death.
My name is JAKEGINT and I am running for “Gay Mayor.”
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Tsk Tsk Tsk.
Really. You all already have a gay mayor.
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“You all already have a gay mayor.”
You can do better than that.
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I figured I’d lay off a bit due to the egregious Old v. New Titans game today.
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Long Dollar — short commodities?
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not shorting.
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Fly,
Any thoughts on C this week ? Barclays has some big offering tied to C stock, notes bought at $4.65 and they mature in 6 months, capped at $6.05 (pay 17% or something) .. I was wondering if you know,- do offerings such as this have a large effect on the price of the stock this week? Or for the market in general as a sign that the overall demand is coming back?
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I own C long term. No opinion on short term direction.
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gotcha, I also should have put that the offering is happening this week, and considered quite large…
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Own C as well through short puts(naturally)
Will keep rolling out, couldn’t give a fuck short term
werd. gracias.
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ps, did you mean exasperated (exacerbated) above?
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no moron. I meant what I meant.
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i swear someone changed it.
but hell i’ll take a lashing. used to getting beatings anyways.
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Jedi Mind Trick.
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Through the Looking Glass, Humpty Dumpty style.
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question:
What is a decent non-premium source to evaluate leading sectors? Is the main way to do this by typing in sector symbols and just comparing their charts?
PPT and IBD both offer pretty good & easy sector analysis, but are both premium. right now I’m 100% piker.
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I just looked up the charts myself. Going along with Fly’s analogy that this site is like a Mcdonalds, I just shot a cow.
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i guess my balls just dropped
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Fantastic question. Next time I visit mcdonalds, ill be sure to ask manager where I might buy “free burgers.”
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if someone in the mcdonalds knew where free burgers were offered, i’d ask them. couldn’t hurt.
on another note, you just compared IBC to a mcdonalds and yourself as a mcdonalds manager
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Yes I did. What of it?
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nothing. i bet you’d be a great mcdonalds manager. it’d be a great source of hot grease to throw in the face of drive through customers who ask for free samples
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He would change the name from “Big Mac” to “Fonzi Burger”. LMAO!!
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You clearly missed the point
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Tim Knight’s only large positions are long ones now.
This market is going to tank like a big old bitch now. Tim Knight has been bass-ackwards all year.
Get ready for a minor meltdown. What other signal do you need.?
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He’s bullshitting. You can’t rely on anything that fucker says. He said last week that he had made most of his losses back in a market that had gone down 2.2% that week (he was short) after a rally of around 60% since March.
He’s lying snake-oiler.
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He’s a donut hole maker.
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Any opinion on SVA?
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none
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not that im bearish but i hope we get the market correction the next 3 days.. looking for the buying opp..but a little bearish hedging might be in order
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A little end of quarter rally and first of month rally followed by 10% down would fuck up a lot of people so it could happen that way. No, I don’t have any opinion on SVA.
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Sinovac bitchez, fuck yeah!
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Gravatar bitchez, hell yeah!
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what are you mumbling about?
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at the moment the dollar is up against most currencies the futures arent looking bright i guess some thought about the morning open will be needed
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fly, i think you might have been onto something w/ the whole mcdonalds thing. big move probably coming soon in MCD:
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Nice symmetrical triangle but MCD as a good pick is about 2 years too old. Boring as hell, global growth/inflation trade is where it’s at.
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I bought I little Doll yen down here. The Yen belongs at 150 as the place is going to implode in a few years time.
The new government made the astonishing announcement (rather a senior figure did) that Japan would like to see a strong yen as it helps temper down the price of imports and helps the consumer. That of course assumes they are able to export anything or that their export industries can remain viable with the Yen down here leaving aside whether anyone would have a job over there.
In short they’re fucked and this new government is fucking clueless at this stage. I’m thinking that the BoJ is playing a game of Russian roulette with these new fuckers and wants to see just how far they will take things before they crack.
Bought Doll yen here Stop at 87.30.
Barrons has an interesting piece this weekend on how Japan could actually default on its debt in a few years time. None too soon is my reckoning. Someone in the piece suggests that Japanese government bonds are actually the biggest bubble we’ve seen. I agree.
Ignore the weakness in the Japanese stock market as its all related to the strong Yen story.
The Fin min fucker has reiterated his stand this morning proving once again that no one there has a fucking clue.
http://online.wsj.com/article/BT-CO-20090927-703690.html
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never mind
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Beware underestimating the aggregate power of stupid people in large numbers.
That goes for politics AND the market.
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