iBankCoin

Let’s Have a Very Serious Discussion

We’ve already won the war.  The recent rally, if positioned correctly, should have made up the majority of your losses and/or made you a great deal of money. We’re now at a point where our own weapons risk blowing up on us, in reference to the Federal Reserve.

Make no mistake, the market is pricing in a 100% chance of QE3 tomorrow. If the market doesn’t get it, the gentle market you see today will turn savagely violent, turning this bullish tone into something a little more brazen, if you know what I mean.

You’ve already won. Do yourselves a favour and reduce risk.

My strategy is very simplistic, almost childlike: I am raising cash ahead of the Fed and will build a “go to” list of stocks to buy if the Fed initiates QE3. I do not mind paying up because QE3 means 20 straight weeks of uninterrupted winship.

Listen to me very quietly: if the Fed doesn’t do QE3, there will be zero reasons to own stocks for months. It will be viewed as a massive disappointment and mistake, leading pundits to prognosticate about the Fed being “behind the curve”,  helping to sour investor sentiment to the point of apathy.

There is no reason to get in front of this train.

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57 comments

  1. SUBCOMANDANTE CHINCHINILLA!!!
    SUBCOMANDANTE CHINCHINILLA!!!

    Squashed!

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    • Loki

      Oh Gawd, no one wants a squashed Chinchinilla!

      “Opportunities are made up easier than losses”
      Todd Harrison

      Once I learned this my trades/investments became consistently profitable.

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  2. kelkun

    “The recent rally, if positioned correctly, should have made up the majority of your losses and/or made you a great deal of money.” Well, most people are momo traders these days, so they’re still waiting for the S&P to climb another 100 points to “confirm” before they buy because it’s “safe”.

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  3. kelkun

    And personally, I don’t care about QE3, I just think the market will go higher because really, there is no particular reason for it to go down.

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  4. xxxHuggieBearxxx
    xxxHuggieBearxxx

    I agree, all except with the part about having made back my losses. Unfortunately I own the most worthless sectors in the world that go down thrice what everything else goes down, and go up really not at all.

    Anyway, I sold all my miners yesterday that had been doing pretty well. I will sell my horrific crude holdings today.

    I think the Fed disappoints tomorrow.

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  5. Bullish

    Generational bottom is in.

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  6. Moolahheaven

    Get Smart:
    Chief: Max, did you get all that?
    M. Smart: almost chief, i just missed 1 part..,
    Chief: what part was that Max?
    M. Smart: the part after you said “now listen very carefully”…

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  7. Yelp = Yell for Help
    Yelp = Yell for Help

    YELP is all I buy.

    YELP is all I own.

    YELP is all I never sell.

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  8. Good Shepherd

    this is sound money management. are you planning a tropical vacation for july, august and september?

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  9. Yogi and Boo Boo
    Yogi and Boo Boo

    Spot on. They won’t listen though, and their money will go to money heaven.

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  10. Spooky

    I would perhaps add that it’s not just QE3 that the market expects, but a NEW QE3, the dancehall version, the symphonic version, 12-scale exotica that will really wow the audience. To mix metaphors for a moment, it’s Kevin Durant vs. Lebron, and Bernanke will have to play the KD who is going to have show us the full repertoire: step back threes; one dribble into the lane from 25 ft. reverse dunk; alley oops, crossover hop steps, you name it.

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  11. theedge111

    Markets too strong for Ben to QE3 now. Especially since it’s an election year. The loves to preach about how independent it is and moving early could appear politically motivated towards Obama.

    Much more tankage is needed before Ben pulls the trigger IMO.

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  12. lowoffer

    totally serious, will you go short in the event they do nothing

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  13. kcscott

    Corp profit estimates have been revised down for 2H 2012 AND 2013.

    I don’t see any way Ben can justify turning the presses on again.

    So yea, a big sell off is coming indued

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  14. razorsedge

    msft, + ha ha ha. bot fer a trade last night…

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  15. 4fl3x

    Thanks Master Fly.

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  16. ruggyup

    Let the decoupling prevail. Crazy spec with beat my MEET. Biotech small cap specs still ripping.

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  17. razorsedge

    mkt rally ? fed move already known.

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  18. m1illion

    “building cash” You certainly took your time on that one.

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  19. Eddie LeBec

    Dear Mr. Fly,
    on a less serious note, how much further could Joe Kernen get his head up Marco Rubio’s ass????

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  20. schadenfreude

    No QE3. Maybe an extension on Twist through the election. But no new programs will be announced with stocks positive for the year and 10 year yield at all time lows.

    Fed’s latest stress tests in March (CCAR) were done assuming true worst case conditions of 13% unemployment, 50% decline in SPX and another 21% down in housing.

    People are sick of bailouts. And now that the banking system is safe after 3 years of being corn Fed QE, there will be no more ‘intervention’.

    Chairman Bernanke told Congress the Fed alone can’t put Americans back to work. The economy needs help from fiscal policy, too.

    “I’d be much more comfortable if Congress would take some of this burden,”

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    • Trading_Pymph

      I also think there’s no case for QE3. I do, however, expect some Fed action on the housing front.

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  21. milesknowsbest

    Your point makes perfect sense…but there IS something to be said about the Constanza theory…

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  22. Marc David

    I hope interest rates go a bit lower after tomorrow! Borrowing has never been so good. (for some)

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  23. Yabollox

    If there’s no QE or disappointing QE and share prices drop, it’s BUY BUY BUY! (after the drop)

    If there is QE it will be time to ease back in.

    +40% cash here

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  24. razorsedge

    sold msft.

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  25. SLEEK BUTTHOLE

    Once again, this follows the exact prophecies of Nostrilanus.

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  26. Halfbloodpope

    Bernanke is currently taking boxing lessons.

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  27. rru2s

    Shares of LYSCF are already up 13 percent today as the Malaysian government has issued a report by their parliamentary committee to approve Lynas plant startup, on the heels of last weeks official court decision to reject the appeals of protestors.

    Lynas is set to become the world’s largest rare earth producer outside of China with the Malaysian parliament report approving their brand new processing plant in Malaysia.

    Lynas already has stockpiled over 8 months of preprocessed ore concentrate at their Mount Weld mine in Australia, which has the second highest quality in the world of REE mine ores as ranked by potential net recoverable revenue per ton of ore. Lynas expects to become the worlds largest producer outside China with production of 10,000 tons the first year and 20,000 tons/yr thereafter.

    After a lawsuit by the opposition party protestors was thrown out of court last week, the Atomic Energy Licensing Board (AELB) under the Ministry of Science, Technology, and Innovation (MOSTI) has granted the Temporary Operating License (TOL) subject to meeting 2 additional terms, for which Lynas has submitted paperwork today for final approval. The additional terms are merely a backup water supply for dust control and a plan for fixation/stabilization of wastes to be stored at their residue storage facility.

    The Malaysian parliament received a hugely positive report recommending the government approve Lynas, which was prepared under the direction of the Parliamentary Select Committee, and which contained the opinions and critical reviews of independent international rare earth experts, radiation safety experts, and academia and private consultants.

    Lynas trades over 20 million shares per day on the Australian ASX, and currently has 10 percent short interest, which should trigger a short squeeze. On the US exchange LYSCF and LYSDY are the two tickers, which trade a few hundred thousand shares per day.

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  28. jimmy_two_times

    Fly,

    Just wnated your opinion the following being debated around the water cooler.

    The Fed disapointing is probably already a “known”.

    Participants take lack of QE as a signal that everything is alright and push the market higher from here (5% or so), then roll over.

    Would really put the hurt on those who are short and expecting big “bad” news tomorrow.

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  29. Trading_Nymph

    Talks of War Games of Iran/China/Russia is just pissing me off today. Fuck you Fars News Agency.

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  30. razorsedge

    wprt, also up, man im havin a great day! hope u guy r too!

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  31. TradingProdigy

    QE3 = European and Chinese oligarchic money transfer into US stock market.

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  32. 'merica

    You’re probably right, but I’m feeling too greedy to sell. Hopefully I won’t learn my lesson tomorrow.

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    • SLEEK BUTTHOLE

      That’s what happened to me. Then I got my face tossed in a deli meat slicer and served over 10lbs of facemeat to my broker. Honey cured of course faggots.

      Enjoy, the raping and pillaging. It will feel like a biblical Sodom and Gomorrah all over again..

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  33. ShortSqueeze

    If history has been any guide at all:

    Spanish Bank bailout- BFD
    Greek Election outcome- BFD
    Fed meet- …. _ _ _?

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  34. bleached asshole
    bleached asshole

    As usual, the Fly demostrates great winship! and sage advice…..

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    • SLEEK BUTTHOLE

      I hope you are aware that you are violating my intellectual property rights.

      You should go work for a chinese company and copy other products, while create little to no added value. Scumbags of the earth like you are the ones that allowed the MBS catastrophe to happen

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  35. xxxHuggieBearxxx
    xxxHuggieBearxxx

    I am out of almost everything…going to stay out for a while and wait for a good buying opportunity.

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  36. T-Bird

    Serious question. Do any of you actually expect QE? Do you know anyone that expects QE? I dont.

    It isnt coming gentlemen and the market knows it and doesnt care too terribly right now.

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  37. Toast

    So, suppose we have 2 experts. The first expert (Fly) says the market will tank with no QE. The next expert (Cobra) says there will be no QE.

    Not only am I not going to be long going into the announcement, I will be shorter than Emmanuel Lewis, aka Webster.

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  38. OPTIMISTIC BUTTHOLE
    OPTIMISTIC BUTTHOLE

    I had a dream last night that everything was going to be ok and the world will not turn into a chaotic bloodbath of declining securities.

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  39. Mike

    why CPST not jumping on the equipment
    sale to the russians???

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  40. Oldmantrader

    Low volume rally into a convergence of resistance, .618 retracement level and the 50 day moving average. Seems to me like 1355-1360 level is a good it to take profits

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  41. COYPUS

    You just changed your whole strategy regarding QE3 while acting as if you did not.

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