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
23,445 Blog Posts

Greek Bullshit

Greek 2 year notes are now yielding 11%. Can you say default? I thought the EU was bailing those fuckers out? Apparently, according to the laws of reason and democracy, it is impossible to bail out the Greeks. The Gods shall not allow it. Think of the austerity plan as some sort of fucked up Trojan horse. The Greek’s are onto us western types and will not allow said Trojan horse into their city circle, for they invented the Trojan horse and know better.

Even still, the market is hardly down. [[VXX]] is running higher and [[TLT]] is up again; too bad I sold it. But, I could not hold onto those fucking bonds for another day. I was losing my mind being stuck in that boring cocksucker. However, I still believe we are due for some sort of correction; hence the reason for my over-sized cash position. As always, I intend to buy your margin liquidation.

Chinese related stocks are getting hit, as well as metals. This is a very big development. Like I said, the market cannot advance without the metals. Stocks like Reliance Steel & Aluminum [[RS]] , Nucor Corporation [[NUE]] and United States Steel Corporation [[X]] are being taken to the fucking woodshed.

Finally, with my money, I like Fuel Systems Solutions, Inc. [[FSYS]] , TriQuint Semiconductor [[TQNT]] , Johnson Controls, Inc. [[JCI]] , The AES Corporation [[AES]] and [[MTA]]

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29 comments

  1. j

    Fly :

    That pic you have beside the thread discussion appears early Egyptian and not early Greek 🙂

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  2. YaBollox

    Beware of Greeks bearing gifts…..

    some kind of age old advice.

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  3. Antonio

    Hotels and Rental Cars are en fuego for the 2nd day. HOT MAR DTG CAR HTZ

    If you have pricing power to raise prices every day, then you will profit big-time during inflation. recovery or no recovery.

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  4. j

    Something that frightened the shit out of me was a research report I read today discussing the Fed’s balance sheet, which is an incredible mess.

    The Fed owns something like $1.5 trillion in lesser grade paper… junk basically.

    At the present time the Fed gains or loses US$2.5 Billion every time there is 1 basis point move in interest rates. That’s 100th of 1% (which is 100 basis points).

    So if interest rates moved 100 basis points the Fed would lose $250 billion in balance sheet value, which would be a loss that would have to be taken by the US government in its annual budget.

    There would have to be a congressional vote to allow the replenishment of the Fed’s equity if large losses were sustained and the trigger for that is apparently $200 billion.

    We’ve been told that the Fed can sell this paper on the street. But how could it and who would buy this junk knowing there was more to come without a sizable discount thereby causing the Fed even more losses.

    The point is that the research paper can’t see how the Fed can raise rates without ruining its own balance sheet, causing it to go to the Congress to ask for an equity top up that will further aggravate the deficit.

    Obama shouldn’t be sleeping well at night.

    The final upshot is that that there will be a huge, sustained bout of inflation as the Fed tries to depreciate the value of the junk held on its books.

    The Fed isn’t the only Central bank holding junk. Numerous central banks are too. My rough guess is that a 100 point move in interest rates would cause CB balance sheet losses of anywhere between $500 billion to $1 trillion in losses.

    The Keynesian heads think there is such a thing as a free lunch. However it appears there isn’t.

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    • muktukchuck

      And the $us goes into La Toilette. Non?

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      • j

        Or the US dollar along with every other major currency goes down the toilet against gold and shit. I’m not that certain that the dollar would fall against the Euro and the Yen as those two are even more fucked up than the US Dollar.

        Gotta be careful what you think the dollar will fall against as it’s likely not to be the major currencies.

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        • muktukchuck

          Sound logic.
          The Co. I own sells around the world in $us and converts to $cdn. The strength of the damn Loonie is a hurdle right now, and I suspect will stay that way on commodities performance. You can only hedge so long. Might have to start offering in Yen and Pesos.

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      • Sebaco

        ….is anyone even considering that home prices rally? If they do, said “junk” begins to retain more value and the doomsday endgame (rampant inflation) is off the table. Worth considering.

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        • j

          What you say is true, Sab. This means however that they really have to reflate and keep rates lower than the natural rate by a country mile.

          In other words we have inflation and the Fed can’t move much at all.

          Fly’s 100 tomato and 25,000 Dow looks more and more possible.

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          • Muir

            “….is anyone even considering that home prices rally? If they do, said “junk” begins to retain more value and the doomsday endgame (rampant inflation) is off the table….”

            Logic being that once the banks have been saved, there is no need to inflate prices anymore, and therefore, that at this point in time in the future, the FED then raises interest rates without fear of driving the balance sheets of everyone holding paper deep into the red?!

            Hmm… this reminds me of missile defense, works great on paper, and on tests well only if you know the trajectory of the incoming ahead of time.

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    • YaBollox

      Mark to Market applies to the Fed and the US budget? Congress can change that shit.

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      • j

        not mark to market for the Fed. IT can change it, but you can’t get away with it.

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        • YaBollox

          They (Fed) can probably get away with it for a long time. Does the Fed have more paper than Pimco? Can Pimco get away with it? If the paper does not default, they have not really lost anything except possibly less than market interest rate.

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    • Mr. Cain Thaler

      And just now the PPI level of measured inflation was twice what was expected. Moreover, that inflation didn’t occur in durable goods or even higher end consumable goods. It hit right smack dab in the food supply, which is already a highly “selective” (read constricted) exposure to food stuffs.

      I’m very happy to be holding the amount of silver I am. It’s going to be fun, watching some of these assholes riot, provided I stay at a safe distance.

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  5. Yossarian

    Dear Mr. Fly, I would appreciate your views on a recent purchase of TLT I made when you sold. Dam thing’s got a beat like JZ. ‘Sup?
    Out

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    • The Fly

      Well, I held onto TLT for 6 weeks and it has never traded better. You should be alright.

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    • j

      dude,

      There’s new information about the Greek tragedy this morn. Fly does have a time machine but it never travels to Europe.. especially Greece. Ease up smarty pants.

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  6. AI

    Congratulation you bought at the top nailed if I may…..

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    • Mr. Cain Thaler

      Alright, seriously now, let me point out:

      No one knew where the market was going, even if a lot of us expected a correction. Buying a little at what turns out to be the top isn’t a fucking problem. It’s just a matter now of dollar cost averaging at prudent intervals on the way down. Had the market gone up, then the exposure would have negligibly appreciated.

      Jesus, it’s not like he went all in.

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    • The Fly

      Al

      Your mother is a horse slut.

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    • YaBollox

      Fly doesn’t buy the market, he buys companies ready to rock and roll! That boring shit is for boring people.

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    • newmoney

      He bought stocks you fool.

      Big difference from buying the SPY.

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  7. buylo

    Hey Fly, you gots any Grecian Formula left? BTW, yesterday was a great day to go long, if you would only watch some charts.

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  8. scum bucket bitchez
    scum bucket bitchez

    Bonds are not for those who crave action.

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  9. tradingnymph

    Portugal too…it’s hitting highs too….btw spot iron ore out of india and china hit ALL TIME HIGH, even higher then 2008….VALE, BHP, RTP is holding supply and trying to force China into contracts still…something has to give soon.

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