Insane S&P Losing Streak

Ever since May, the S&P has been down. With September’s 5.5% decline, followed by the 5.5% decline in August, we are now down for 5 consecutive months. The last time we had losing streaks like this was in 2002 and 2008 to 2009. In both cases, it led to a monstrous rally. Although I am bearish as a hairy human living alone in the woods, I need to be on guard (no Jerry) for an 8% rally in October.

The market has been grinding lower, led by the absolute destruction of basic materials, financials and tech shares. The leaders have been killed and people have pigeon holed themselves inside 80 year old man stocks. Coupled with the glaring fact that everyone is bearish, Zerohedge’s popularity is at an all-time high and I am 90% out of the market, something is astray, if I might so bold as to say so.

This just dawned on me, as I was doing some reading, thinking about the future. When thinking about stocks, I always lay out scenarios that might play out, then try to support them with historical precedence or hard facts.

The reality is, we are down 5 straight months and the news is as bad as it gets. Despite the bad news, we haven’t cracked lower. Instead, we are meandering around, grinding swing/momo traders into dust.

The real negative developments, aside from Europe, is the deterioration of China and the rise of Chinese CDS. What the fuck is that all about?

What to do, what to do?

We just went from -55 Nasdaq to -19 in a blink of an eye. The Dow was down 50, now +115. If you are day trading, this is fantastic. However, if you are a person of honor and dignity, this is an abomination.

If you try to position yourself for momentum, you will get smoked. The moves are so fast, so severe, you literally need to be insane to swing trade these ranges.

Once again, if you are a Vegas style degenerate day trader, in this game for a teeny, this is your dream come true. For the rest of us, top hatted gentlemen on Wall Street, this is disdainful.

I am emphatically on the sidelines, dreaming of black smoke, mixed with aerosol acid, to melt Wall Street down to the pavement.

On the bright side, financials and trannies were very strong today. Where this market goes tomorrow? I have no fucking idea.

“How did I prepare myself for the crash” will be your final words. In a few weeks from now, when the markets are significantly lower from today, you will remember the words of HORATIO CLAWHAMMER aka “The Fly” and regret heeding his warnings in favor of some dicksucker on Twitter. I have less than 10% long exposure, 20% short exposure and the rest cash. Perhaps today isn’t an optimal day for me, with regards to my position. However, the whole point of my position is preservation of capital. With that in mind, I’ve done my job.

All of the stocks I am short will crater, as sure as I am sitting here, especially EXH. These things take time to develop, something people will ADD are unable to comprehend. You’re much better off eating cantaloupes in Denver, than fucking around with me, betting against my winship.

Anything remotely related to China is getting poleaxed today. From the basic materials to high end retailers, it’s WHOOSH lower in dramatic fashion. Ten percent drops in TIF, on no news, is not normal. There are dislocations in this market. The whole matrix is fucked up and you are much better served waiting it out, than betting on Slovakia ratifying the ESFS package.

Forget about Greece and European debt issues. We’re past that and you don’t even know it. All eyes are on China, global growth and the liquidation of large hedge funds. How will the market absorb the wholesale liquidation of billion dollar funds, while the markets are going lower?

Answer: You get pinless hand grenade trading action, like WYNN, YOKU, COH and BIDU.

Look, all of this is child’s play for me. I am positioned to buy the margin liquidations of some of your best friends and family members. While Dad sells out of this positions, out of disgust, Le Fly will swoop in like a fucking golden falcon and take his shit. The whole point of being bearish, in my opinion, is to buy at lower prices. I do not covet the absolute destruction of my neighbor, just 30%.

Eventually, there will be a great buying opportunity. It’s just not here yet.

Fuck this market. Everyone is full of shit. You all have wild grandiose claims that amount to absolutely nothing. Most of these little trollops have less than 50k in the game, yet come here to iBC to school Fly. I’ve been throwing bowling balls at everyone of these finance blogger-fuckers for centuries. It’s always a mistake batting against Le Fly, for my fastball travels quickly and it is always aimed for your helmet.

My EXH short is one of the biggest winners of the day. Fuck you Mother Market, running sideways, with a pineapple up your ass. I have no interest to buy this piece of shit market. Everything is gonna get dick chopped, eventually. So if you’re buying now, you are simply playing a game of Russian roulette.

Copper, Silver, Gold, Oil: fuck them all.

We’re going under 1,000 on the S&P and there is nothing you or your stupid fucking friends can do about it.

UPDATE: I shorted EXH and bought ERY

If you already live in the hills, stay where you are. Everyone else, pack your shit and run out of your homes RIGHT NOW. This market is being liquidated by a hedge fund failure. Some loser who lost his mojo, most likely valued $5 billion+ in personal net worth, stopped giving a fuck about his AUM. As a result, his billion dollar hedge fund Red Sox’d itself this year.

2011 is one of the hardest trading years I’ve ever seen. Hell, I am +3% for the year, after racking up 60%+ gains for the past 3 years. Needless to say, if I am having a hard time trading this market, just imagine how my peers with small brains are doing. Ha, those fuckers are vomiting on themselves, as we speak, doing lines of blow off garbage cans.

Stoically, I remain 70% cash. However, my longs are getting shot in the face, namely WNR. And, my shorts are higher, EXH, LM, TROW, ERY, NTRS. It’s just one of those days. However, even with the sun, moon and stars aligning against me today, I am practically unch, due to my fantastically grande cash horde.

The market is lying to you. If you look at the Dow, then quickly look at your stocks, you will see I am correct. See, I am not buying WNR because the market is going to crash. It is going to be quite the spectacle, men running around on rooftops, diving off into the manholes below.

Let me show you something.
No. Ticker % Change Market Cap
1 AMD -10.89 4,380,000,000
2 FOSL -9.32 6,460,000,000
3 FAZ -8.34 1,209,974,941
4 FMCN -8.20 4,360,000,000
5 NFLX -8.13 11,820,000,000
6 YOKU -7.95 2,870,000,000
7 WYNN -7.88 18,240,000,000
8 SINA -7.66 6,430,000,000
9 EW -7.61 8,580,000,000
10 DVA -7.41 6,720,000,000
11 SCO -6.83 2,528,487,273
12 BIDU -6.20 46,650,000,000
13 LVS -5.98 33,380,000,000
14 SFY -5.69 1,270,000,000
15 TIF -5.67 9,130,000,000
16 MOS -5.46 32,440,000,000
17 SOHU -5.40 3,040,000,000
18 MPEL -5.04 6,680,000,000
19 COH -5.04 15,200,000,000
20 VRA -4.91 1,210,000,000
21 IVN -4.76 15,380,000,000
22 WNR -4.63 1,570,000,000
23 GMCR -4.57 15,110,000,000
24 CRR -4.47 3,330,000,000
25 PCLN -4.22 25,930,000,000
26 MAKO -4.17 1,450,000,000
27 HFC -3.84 7,590,000,000
28 PIR -3.78 1,280,000,000
29 YGE -3.74 1,010,000,000
30 WLT -3.60 5,200,000,000
31 EXPE -3.57 8,020,000,000
32 DECK -3.54 3,210,000,000
33 FNSR -3.54 1,510,000,000
34 YNDX -3.36 9,800,000,000
35 ACTG -3.32 1,670,000,000
36 TPX -3.32 3,910,000,000
37 CROX -3.27 2,430,000,000
38 EDU -3.26 4,160,000,000
39 CBS -3.25 15,550,000,000
40 AMRN -3.24 1,420,000,000
41 IMAX -3.21 1,140,000,000
42 FDO -3.04 5,890,000,000
43 NTES -2.91 6,230,000,000
44 SWKS -2.87 3,870,000,000
45 RL -2.83 12,400,000,000
46 IDCC -2.82 3,250,000,000
47 YUM -2.76 25,080,000,000
48 GTE -2.69 1,730,000,000
49 NXPI -2.68 4,270,000,000
50 ARIA -2.64 1,170,000,00

Does that look like an +200 day?

I spit on this market, with extreme disdain.

So the Germans are going to enslave themselves for the benefit of their cigarette smoking neighbors. Great. Okay, since that is settled, how’s the economy doing?

Hmmm.

Tread carefully.

They are readying to go “all in”, buying out all of Europe’s debt in order to ship a few BMW’s to China. Plus, the Greeks need to unwind a bit. This whole austerity shit has them stressed.

Crazy pipe guy, Head Strudel Gobbler, Germany

Title: “They call me Dr. Copper”
Artist: HORATIO CLAWHAMMER
Auction House: Sothebys
Date: 9/30/11
Time: 11:59pm
Starting Bid: $99,000

I am very busy now, as I prepare to buy all of your margin liquidations. Today marked the wholesale liquidation of metals and basic material stocks. For those who adhere to the irrefutable laws of mathematics via buying TZA or ERY yesterday, I tip my hat to you, while counting my wins in ERY.

More on this later.

UPDATE: This guy is THE ULTIMATE BEARSHITTER. ROFL
[youtube:http://www.youtube.com/watch?v=lqN3amj6AcE 603 500]

First, anyone who says “part deaux” should be fired upon on spot. “The Fly” doesn’t make believe he speaks French, despite being a household name in Bordeaux, known as the invulnerable Le Fly.

I want you to get your heads out from the asses of German finance ministers. Look around and see the vices tightening. Interest rates are at record levels, yet credit is tight. Well, guess what, shit is about to get tighter, as the housing meltdown in America dumps bricks onto the balance sheets of your favorite banks. Add onto that, Europe is shut down. Nothing is getting out and soon enough you’re not gonna be able to go in.

I view this market like the tab attached to a pepsi can. You keep turning that fucker back and forth and eventually it’s gonna fall off. By the time the market bottoms, Rick Ross is gonna look like Eddie Murphy, famished from the great credit crisis, part two.

The obvious thing to do is sell short banks; but it gets better. In a tight credit environment, any company saddled with debt, maturing near term, will either fold tent or dilute the fuck out of shareholders. Think of FTK back in 2007 when it was trading at $20. Sure, I picked the bones off that company, buying in the $1-2 range. But they got lucky. This time around, the credit crisis is for keeps. Companies like EXH will need to sell their souls to the devil, or do PIPES, to raise cash.

Providing you can withstand the overwhelming volatility of this market, there is a great deal of money to be made as the crisis goes from 2nd to 9th inning.

NOTE: One of the side effects of hedge fund liquidations is monstrous drops in commodities and commodity related shares, since those fucktards are overweight the sector. I added to my ERY position earlier today.