Dealing with a Common Denominator

Let’s keep it simple and call a spade a spade. There are numerous variables that create volatility in this market. We can talk about Portugal, Greece, Japan or our munis. But, at the end of the day, there is one common denominator that brings us back to the straight line: LINES OF COCAINE OFF RED HOT TOMAHAWK MISSILES.

Ben Bernanke smokes philly blunts at night, decrying how he will “get those bitches tomorrow,” meaning bearshitters wrapped in burlap. Everyone “feels” the market is going to crap out based upon some historical comparison, yet here we are defying gravity. I am not unique in the belief that there are people inside of the Federal Reserve who actually do lines of blow off freshly minted currency. Additionally, I am not the only person who thinks this is all a joke that will one day be revealed as some sort of science experiment on humans, created by our alien overlords.

Nevertheless, I am having a difficult time grasping with the concept of perpetual meltups as well, considering the multitude of reasons to sell. Having said that, I find that keeping a cash position over 20% calms my nerves and allows me to nap during the day and/or play ping pong with rented Chinese friends.

In short, no one really knows why the common denominator is stock market on dynamite sticks, but it is. So, until proven egregiously wrong, you might as well buy any and all dips as if your ugly faces were on fire.

It didn’t matter what WNR’s intra-day price was today because it’s going higher. Even though she gave back some gains, I remain stoic in my belief that it will erect again, north of $20. In addition to that, I have FORM sprinting higher. People, this is classic buy the blood trading. There are few reasons to buy, multiple to sell. I am saving myself from making errors just by avoiding short selling. No matter how bad this tape looks, I will not short it. Period.

I got VLO and TER about to rip the tits off you short selling dicksuckers. Sadly, I am out of OPEN, as it creeps its way past $100.

I am long some airlines for a hedge. Basically they are doing exactly what they should be doing today: down. “The Fly” is readying his space rocket to laser beam your house into dust.

Holy ape shit, I can’t keep up with all of the news flow. It’s egregious.

Let me try to recap:

Libya -fucked
Egypt- fucked
Bahrain- fucked
Yemen- fucked
Israel-fucked
Palestine-double fucked
Portugal- fucked
Ireland-fucked
Greece- fucked
Japan-fucked

Did I miss one? I mean, who in their right mind wants to be fully invested with all of these headwinds. Look, it’s nice to be a positive person, without worries or brains. But some of this shit has to stick. Don’t you think all of this shit is a bit much for a global economy trying to recover from a banking disaster?

Who the fuck knows?

All I know is that commodity prices are lifting off. Everything from rice (Thailand is cutting back from 3 harvests to 2) to gold to oil is going up, despite dollar strength. People want to believe in something tangible in a world of lies and deception. You can touch corn, but not the lying face of Obama.

I am fully invested for my standards, until the world cools off. I will keep my 25% cash position reserved for a rainy day.

Before I invented The PPT, I used to spend countless hours scouring for stocks that takes me seconds to find now, literally. I am going to share one of my favorite screens with you leaches now, in the spirit of giving and democracy. The way I figure, if President Obama can spend billions on liberating a population of 6 million, the least I can do is share a simple screen or two.

Criteria:
Technical reading: over 2 (tech score consists of acc/dist, price performance, relative strength, volatility and volume, as well as proprietary “fifth column” and sub rosa metrics aka secret sauce)
Market cap: over 1 billion
ROE: over 15
Short %: over 10%
FPE: under 35
Quarterly Revenue Growth: over 25%
% from SMA 20: between -5% to +5%

Clarification: I am using SMA20 because I like buying stocks that are in uptrends. However, it’s not a deal killer.

Results:

CLR
INT
AMKR
CNS
SWI
PRAA
YGE
SOHU
CAVM

What’s next?

Cross reference seasonality data to see if there are any standouts.

Both PRAA and CNS standout in that regard. However, seasonality data does not make me buy stocks. It’s more of a novelty. The critical part of making the decision to buy a stock is timing. Is the timing right?

Enter recent PPT extreme range chart.

As you can see, The PPT registered a very high reading yesterday. As a matter of fact, it was the 2nd highest reading ever. To me, first and foremost, this is a sign to tread carefully, which is why I opted to nibble on FORM today, instead of bite. I still have a 25% cash position.

Finally, the last of the leg work is good old fashioned detective work, which entails reading through research, listening to conference calls and calling management. I know most of you do not bother to listening to calls or reaching out to management. Let me tell you, that is a HUGE mistake. How do you think I knew so much about FTK? There was no research available or informative press releases. Call the company and build a rapport. You will be shocked by the value you can extract from meeting with management or conducting private client conference calls.

These are just some of the methods used to find new ideas. Often times, ideas come out of left field. But the very best ones are homegrown out of a belief. Nothing beats conviction.

When I was starting out in the brokerage business, I bounced around from firm to firm in search of riches. This one place I was at was especially seedy. One day, a new broker was seated next to me. I was just a punk kid, with zero prospects, but lots of fire in my heart. Anyway, he was an older Russian dude with a thick accent, sort of weird looking. He sat down and introduced himself and made all sorts of proclamations about his business. He said he had 500 clients and did 150k gross per month. Hell, I didn’t know what the fuck he was talking about, so I just ignored him and continued “dialing for dollars.”

He plopped a comically large stack of leads on his desk, declaring “these are my clients.” Shit, from my vantage point, they just looked like leads. Right away I though “this fucker is a lunatic.”

He stepped away for a second, apparently off to take a leak at the firms bullshit bathroom. Fifteen minutes later the office manager came over to his desk, rummaging through and gathering personal belongings. Lo and behold, on the very same day this fucker was hired, he passed out on firms bullshit bathroom floor, heroin needle stuck in arm, straight up dope fiend style. Ha!

It gets better.

The brokers (sharks) who worked there saw this as an opportunity and took EVERYTHING from this guy’s desk, down to the last lead. It sort of looked like a pack of hyenas scrounging for wilder-beast leftovers. When the old Russian dude came back the next day for his stuff, all that was left were nice send off notes from the gentlemen in the boardroom.

For the day, I lost money. But now I’m off to celebrate anyway. I’ll make that shit back tomorrow.

Back in the old days, the old fuckers at my firm would be nodding out in the boardroom right about now. They didn’t give a fuck about decorum or work ethic because they had $20 million in their trading accounts. So, on slow days like this, they’d snore at their desks.

You need days like this, in order to lure in buyers. I’m not having a particularly good day, as most of my positions are down. However, as long as WNR stays erect, all is good.

Right about now, “The Fly” needs to be in his automobile going 195mpg down the wrong way of a busy avenue.

See you fuckers in about an hour.

I bought 25,000 FORM under $10.

I like a few things here. One, as all of you know, are the refineries. My favorites are WNR and VLO. To hedge that, I am long airlines. Anyone that travels knows planes are packed to capacity and they are charging outrageous prices again. This is a classic Econ 101 play, where demand outstrips supply leading to higher margins. Should oil ever fall back, airlines will rip tits. My favorites are LCC and DAL.

I’ve been looking into food safety plays, due to Japan, and found NEOG. Any of you fuckers know the name?

In the tech space, FORM and TER are my favorite plays. Go take a look at FORM’s balance sheet and their new order from Elpida. Without a doubt in my mind, FORM is a $16 name.

Like I said last night, 2011 has been a hard trading year, but I have a plan. I know the sectors and stocks that should outperform. It’s simply a matter of executing my plan without getting distracted from novelty ideas. It’s worth noting that both MOTR and BORN were novelty ideas and ended up costing me lots of fucking dough.

Until I am satisfied with my returns and have room to breathe, I will be sticking to core thesis plays and avoiding short term trading opportunities, no matter how much they tempt me.

By the way, this is my worst trading year since 2004. Typically, I get off to a quick January, usually up more than 15% by now. Yet, here I am, midway through March, and I am barely up 8%.

What the fuck happened? How could I be so retarded?

The answer is very simple, yet convoluted. As many of you know, I had my faced MOTR boated about a month ago. And more recently, BORN fucked me up something awful. However, in my defense, BORN wasn’t my fault. I was right about their numbers and the stock went up big on earnings day. However, all of this bullshit, cocksucking, Chinese fraud is fucking with BORN. I ate the loss because I lost the initiative.

As for my personal account, it is now up about 4%. In all, 2011 has been a very uninspiring year for me. So many times I get excited about a thesis, then find myself on the receiving end of a homo hammer, having to trade my way out of murder holes. My latest and greatest endeavor is to be long refiners. Let’s see how this shit works out.

Disclaimer: Assholes, I do not require your feedback or tips. You are beneath a person, such as myself, and should feel lucky for even reading this shit.

You are not permitted to address me directly today.”The Fly” is roaming his office, dressed for success—white robe, sandals, crown. For all of you goat fuckers who bellowed about PESI, go eat a dick. I’ve been a little non-descript lately because I am in the process of making a very large bet. This year, for me, has been marked with crazy volatility, with big winners and big losses. I’ve been MOTR boated, BORN with a fucking headache that I can’t shake. I do not like to live in mediocrity, so I am making a large directional bet.

For me, there is no better investment thesis that the refiners right now. Period. Nothing else competes and I am going to invest millions behind this belief. Personally, I own more than a million dollars in WNR stock. Additionally, I have been buying VLO whenever I see my shadow, like it’s some sort of fucked up version of groundhog day.

Today’s wins were marked with “awesome and amazing” price action in TER, WNR, VLO, FORM, MAS, FLWS and PESI.