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
19,840 Blog Posts

In the Event We Don’t Die

The hardest part about being wrong is compounding errors with more errors. For example: I’ve been long and wrong over the past two weeks, wiping out all of my YTD gains. I could very easily hit the reset button by selling it all, in an attempt to salvage my year through precision picks. However, I run the risk of missing out on the biggest and baddest rally the world has ever seen.

Like it or not, the Europeans will eventually print euros. When they announce this plan, the market will soar by at least 400 on day one, then another 600 over the next two weeks. By selling out at the lows, stopping the bleeding, I may sink my ship by missing out on the wondrous one day snap back rally for the ages. This is why we haven’t seen a 2008 flush out yet, despite the horrific news.

When we do rally, I expect everything to trade higher, especially gold and silver. Whatever QE deal is announced, it will be viewed as inflationary, which in turn will bolster the euro and sink the dollar. Gold and Silver are the best barometers of risk and currency diversification in the world. Secondly, I know commodity related stocks will rip tits and the banks will offer insufferable short squeezes for the bears.

It will be a joyous occasion, as Wall Street celebrates the splendour of equities, while drinking copious amounts of spiked eggnog.

Over the weekend, there have been encouraging tidbits of news coming out of Europe, with regards to the creation of a Euro Stability Union and Federal Reserve bailout of Europe. Remember, it is the job of the ECB to promote price stability. If prices are dropping precipitously, as the olde continent drifts into deflation, the ECB must act to bolster prices. It is not a question of if they will do this, but when.

In other news, Black Friday sales came in well ahead of estimates at +6.6%. More impressive were online sales +26%, with amazing results coming out of AMZN. 2010 online sales were +9%. In a normal environment, this sort of news would serve as a jump off point for much, much higher retail stock prices.

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117 comments

  1. RoboGal

    Nothing has been fixed…

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  2. RoboGal

    Everyone is so Bullish

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  3. sentimentArb

    “…which in turn will bolster the euro and sink the dollar.”

    If the ECB prints, won’t the euro fall? Larger money supply = currency depreciation.

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  4. pedro

    Very well said, Fly. We would have been flushed out by now had things been beyond repair. It really, really must suck being a bear. Tried it out myself for a couple of weeks, and have to say, it wasn’t the best outfit I’ve ever tried.

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    • SUBCOMANDANTE CHINCHILLLLLA!!!
      SUBCOMANDANTE CHINCHILLLLLA!!!

      Maybe you wearing it inside out.

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    • Frog Playing a Colorful Accordion
      Frog Playing a Colorful Accordion

      I guess it depends on when you wear that suit. October was not a good month for Bear suits. Last week was very good. I am not quick enough at changing suits, so I end up in cash most of the time lately.

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      • rhino

        Cash= good call

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        • Steve

          The best way to make money in the current environment is not to be a “bull” or a “bear” but take advantage of technical setups both on the long and short side. Be nimble and be quick but do not be stubborn. You can make a lot of money with this attitude.

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          • pedro

            I couldn’t disagree more. It’s those who have been stubborn that have made money since August. The trend, whether up or down, has consistently reversed. If you’ve been changing your mind in the name of “not being stubborn,” you’ve likely lost money buying at tops and selling out at lows. Bulls and bears alike have had multiple chances at profits since August–it’s the pigs that have consistently been slaughtered.

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          • The Fly

            Pedro

            4 weeks ago the market soared 1,300 points. If you were short, you were wiped out

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          • pedro

            And if you were stubborn and held all the way through, you made most of your money back during this stretch of 7 consecutive down days.

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          • sg

            Only if you could have forseen these 7 days after being in dungeon for entire October.

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  5. Pete

    “However, I run the risk of missing out on the biggest and baddest rally the world has ever seen.”

    We had one of those already. From October 4th to the 27th we had that huge rally.

    Disclaimer: I dont invest anymore. I just read Fly’s blog.

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    • JC

      I am 100% serious when I say that I believe Confederate currency (as art) is a far safer store of money than either the US dollar or the Euro in the coming years.

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  6. Eithan

    well if the s&p wont drop under 1000 in the next 6 months that will be a hell of surprise considering how many poor people there are in the world. (closed my TZA position on friday and bot some google for disclosure but that’s because we were too over sold and i dont want to see the weekly chart gap closed if it does that very bad for the bears)

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  7. The Fly

    IMF bailout in the works. See iBC News.

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  8. James

    Hope is not a risk management process and relying on the eurozone leaders to do the right thing is definitely something I want to avoid. As of now, it’s a coinflip in my opinion as to whether or not this will get resolved. If it doesn’t, S&P500 could go to the 950 range. If it does, I see S&P 1350.

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  9. Brendan maye

    Fly they are talking shit about you over at market ticker.

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  10. Trading_Nymph

    You know, Nymph and my sidekick the US Dollar really hate the end of the month. In the last few days of the month, many of the major Oil Companies make payments to the Canadian Govt which helps the Loonie. Also, The Bank of England has to make a monthly payment to the ECB, which spikes up the Euro..On top of all that, I have to deal with passive F/X Funds rebalancing which is also normally good for the Euro. Yes, IMF..German/French Love Feast gossip all around..so we could get just another short squeeze leading into the central bank meetins ala July 2011, Oct 2011..etc. But, bottomline, we are now on a downtrend so I just have to sit and wait thru all of this silliness…oh well, maybe one day I can get a better handle on short term silly. In the meantime that stupid Oct Rally pop is almost all gone..come on 1120

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  11. James

    Isn’t the obvious F U trade for things to sell off after/if the Germans allow the ECB to print?

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  12. pezhead9000

    “Today we light the first candle of the Advent wreath. This is the candle of HOPE.”

    We will not crash during Advent – like, lets INVENT a rally

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  13. Juice

    treu dat

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  14. pezhead9000

    It is the season of HOPE – I believe, I believe,…
    “Dealers See Fed Buying $545 Billion Mortgage Bonds in Third Ease”
    http://www.businessweek.com/news/2011-11-27/dealers-see-fed-buying-545-billion-mortgage-bonds-in-third-ease.html

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  15. No One

    Poof. Your horseshit bear market is gone.

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    • tomhendrix777

      love it terrible when people want the world to end so they can make a little money

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  16. The Fly

    Gameover for the bears again

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    • Juice

      already counting chickens, senor T?

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    • TeahouseOnTheTracks
      TeahouseOnTheTracks

      STUPENDOUS … Too bad you banned VegasII, I shall miss his commiserating once again.

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      • flyaway18

        I do wonder how close Vegas II came to recouping all of “his money.”

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        • TeahouseOnTheTracks
          TeahouseOnTheTracks

          I told him to book his recent gains last week before they disappeared but he wanted the whole enchilada … too bad.

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  17. CDude

    And voila, we are up 18 handles.

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  18. No One

    DJI to 200
    Nasdaq 5000
    Here we come.

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  19. Pete

    Rofl here we go again. Good times ahead….Again, at least for X amount of days/weeks.

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  20. kidstock

    Another Fly Bottom…the good news is you did not capitulate and remained long. Even if you gave back YTD gains, you’re well positioned for the snapper and are still outperforming the averages. Well done Sir.

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  21. pezhead9000

    Ironically, I sold SSO on Friday when the black friday rally didn’t last

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  22. Bullish

    Poof! Your bullshit selloff is gone.

    TZA to the single digits.

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  23. #Occupy Gold

    I’m cheering, too. But won’t the IMF force Italy to sell Gold?

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  24. Steve

    Futures wayyy higher. Gap and go until end of year. Shorts are about to get squeeeeezed.

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  25. JNROD

    I do not understand the logic of not selling because you might missed out a rally?. How about not selling and enjoying a sell off?. The problem I see with this logic is that the rally can come 1000 pts below current levels (it might start tomorrow but we simply do not know). With my money I am sitting in cash and I do not care in missing out the initial rally, I rather chase the second half (the next 600 pts you are talking about).

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  26. JNROD

    I am not so sure that silver and gold under a Bail out scenario will continue higher. If risk trade is back then gold and silver could be sold to chase other assets. Also there is the potential of physical gold being sold by the trouble countries to back the bonds

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  27. alf44

    … while most here were goin’ all chicken little and shit Friday and ALL weekend … as I posted repeatedly … I was “caressing” me some TNA with both hands on Friday !!! fwiw

    Of course, I am hedged (SHORT) a bit with some TYP !!!

    We shall see !!!

    .

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    • Chris

      Alf, what’s your % return for the year?

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      • alf44

        ~ +14% !!!

        (as of last Friday 11/25/2011) fwiw

        .

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        • alf44

          … to be perfectly clear :

          I have been SHORT for a while (since early Oct.) !

          I was SHORT during the Oct/Nov “UP move” … and remained SHORT throughout !

          Did it suck ?

          Yes … definitely !

          Did I make a complete mess of that trade ?

          Yes … definitely !

          However, that said … I stuck with the SHORT (averaged some along the way) and finally was rewarded with a chance to raise CASH (@ near B/E) ! That is to say … I started covering my SHORT last Wed. … and again on Fri. !

          With the CASH … I started scaling in LONG some TNA !!!

          I am still holding some TYP (ie. SHORT) exposure as a HEDGE !

          AND … I got CASH !

          Uhhh … can you say catbird seat ?!?

          😀

          .

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  28. Blind Read Ant

    Good luck to IBC going long, unless plasying $D or $ CHK as I posted this weekend for a longer term 2012 play.

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  29. kidstock

    1170 is the line in the sand for the bears…last week they were able to breach this level on a low volume / light participation day and managed to lure many more bears into the trap as a result. Good times for the bulls. Long GM & VMW calls and TLT puts – all purchased on day of aforementioned breach. Giddyup!

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    • Yogi & Boo Boo

      Lemme get this straight: The “line in the sand” is some number below Friday’s high and above Friday’s low? We are down 7 days in a row and move into the previous day’s range is a change of trend? OK.

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      • kidstock

        Maybe its not your line in the sand but the action Wed and Fri appeared to revolve around 1170.

        How’s that fat cash position working for you now…Toddo??

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        • Yogi & Boo Boo

          @kid – no offense meant. I hope it works out OK for you. I just don’t see that move as significant based on the momentum of the down move.

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          • kidstock

            Sorry, I’m feeling a bit salty lately. Take off your shoes and get this week started!

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  30. Yabollox

    Printing Euro$ will bolster the euro… I don’t quite get that one. Maybe by averting disaster? But one of the oddest things in this economy is the printing of dollars and lack of inflation. It’s rather confounding to me.

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  31. Missing Face

    Important T&A for the bears!

    Gorilla Pattern Alert

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  32. TMoe

    IMF bailout too small

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  33. goldie

    Told you Fucks on Friday this would happen

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  34. Dick Short

    SP future up more than 2%, WTF …

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  35. South of the Mason Dixon
    South of the Mason Dixon

    “Black Friday sales came in well ahead of estimates at +6.6%…”

    Americans really know how to consume cheap shit. We’re no. 1 baby! The world is tearing itself apart, not the least of which the violence on Black Friday exceeded all expectations, and Americans blithely kept the party going.

    There are so many fucking cans being kicked down the road it looks like the end of a southern fraternity’s pledge week. Public debt, private debt. Spend more! Print more!…fucking doesn’t matter.

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  36. MCPJ

    FED QE in feb/mar to boost Obama-mans reelection?? this is all so pathetic… the beatings will continue until morale imporoves

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  37. dave

    To infinity and beyond. This is comical. It doesn’t matter how far you kick the can, eventually it will blow up.

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  38. BubbleBobble

    MFN -Minefinderss and AVL -Avalon on the watchlists for tomorrow as key longs.

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  39. Heaterman

    Shotgun thoughts:

    These fools are trying to prop up something that cannot be saved.

    The devil will be in the IMF fine print for Italy.

    How in the hell did Corzine get the rules changed so he could gamble with client funds? Doesn’t anyone else think this stinks all over the place?

    Where did the 600,000+ in silver deposited with JP Morgan come from?

    Does anyone else here realize that the “market” ceased to exist in 2008. When fundamental rules can be obliterated via political connections, the rule of law and a nation of laws has been well and truly gutted.

    In coming days money you have “on paper” will be confiscated so gains or losses now are immaterial. The only money you have is what you physically hold.

    There really is not much cause for optimism here.

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    • Yabollox

      Those are all a bunch of old thoughts. Corzine is gonna get fucked. The Dems never really liked him, they liked his $ when he bot his way into public service.

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    • Frog Playing a Colorful Accordion
      Frog Playing a Colorful Accordion

      Corzine did not change the rules. The rules apply only to “the little people.” Big cheeses like him do not have to obey the law. Haven’t you noticed that before? Even Madoff would have gotten away with it if his sons had not turned him in. The SEC looked the other way.

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  40. kidstock

    Fly, regarding your bullishness on gold & silver, wasnt your PM thesis based on November seasonality??? If so, there’s only one week left in the month and thus this should be viewed as an opportunity to sell into strength and redirect towards other sectors where December seasonality is in your favor.

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  41. Mr. Cain Thaler

    Poof! The last 7 hours of bullishness in these comments looks retarded. Quit being gullible, rally monkeys.

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  42. Heaterman

    All coming apart already. Euro land will be lucky to make it to the end of the year.

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  43. pitbull

    Angela Merkel Ordering the people to sit down on the grass, He took the five loaves and the two fish, and looking up toward heaven, He blessed the food, and breaking the loaves He gave them to the disciples, and the disciples gave them to the crowds,
    and they all ate and were satisfied. They picked up what was left over of the broken pieces, twelve full baskets.
    There were about five thousand men who ate, besides women and children

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  44. Frog Playing a Colorful Accordion
    Frog Playing a Colorful Accordion

    Oh, so that’s how perpetual loans and money printing save the world. Thanks for the explanation, Pitbull. Some of us thought that the U.S. or Europe would end up having to pay back our debt. Silly us.

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  45. fake amish

    interesting free for all in the comments site wide at ibank tonite. fucking fight nite. big move comin?

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  46. jp

    The trend in stocks from the 2009 low is remarkably similar to the one that led to the 1937 bear market. Patterns in currency relationships also point to ‘risk off’.

    http://www.dailyfx.com/forex/video/technical_analysis/2011/11/18/Charting_the_1930s_Stock_Market_to_Now_-_Look_out_Below.html

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  47. no_joke

    I raised quite a bit of cash last Wednesday. I should have known better…”they” won’t let the system fail. Should have listened to my gut instead of all the negativity that was being posted here.

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  48. JakeGint

    Dollar death (or at least swoon) is as sure as shootin’, so don’t let those ursines prejudice your thinking.

    And remember, only a ginger can call another ginger “ginger.”

    ______

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  49. Dr Funk

    Again, slowing / declining growth eurozone / china. Establishing another FSEUFSFFS wont fix that. If you believe good growth, and tons of growth is coming then have at it

    How about an infinite number of bailout entities that keep bailing out the previous one. PONZI would be proud, but in the end, there arent enough chairs when the music stops

    Bot some on friday just names I like. Due for a bounce. Probably drop a triple inverse at open. But ps, EURUSD isnt exactly jumping. Actually lower. How many days, hours, or minutes, do bond yields ease for this time

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  50. TeahouseOnTheTracks
    TeahouseOnTheTracks

    Some short squeeze plays:

    http://online.wsj.com/mdc/public/page/2_3062-nasdaqshort-highlites.html#shortF

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    • TeahouseOnTheTracks
      TeahouseOnTheTracks

      go to “shorts as a % of float” … as if you didn’t already know that!

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  51. TeahouseOnTheTracks
    TeahouseOnTheTracks

    DOW up 243 at 11430 … SPX 1183 +30

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  52. Yogi & Boo Boo

    Anyone have any info on the BTB 10 year auction “no charge day” that they’re talking about on CNBC? Apparently Italian citizens can buy the bonds at auction today without paying for them right away. Google search comes up empty.

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    • Yogi & Boo Boo

      No fees when bought in the secondary market. Apparently the auction went well.

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  53. kidstock

    I love the sweet sounds of performance anxiety so early in the morning…6-7%+ yields are a GIFT in comparison to what Treasuries are yielding.

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