This trade is going to be very simple. Sell stocks and seek refuge in the niche. What is the niche?
Special situations, driven by near term catalysts. Take the rip, then run.
For the past two years Wall Street gave Obama a pass–him and his “pay your fair share” shtick– because no one believed it would happen. However, rest assured, taxes are going up on corporations and you will eat your peas. This is not a question of if stocks will trade lower, but by how much? There will be a PE compression to price in higher corporate tax rates. If the government was doing this to fix its balance sheet, Wall Street might forgive them. But this is about entitlements. They want to take from us and give to them–a recipe for mutual destruction.
This will bubble to the surface in short order, as the “fiscal cliff” nears.
I’m not sure how much downside we will endure. I only know we will endure it and see it through. I will not actively short stocks because the Federal Reserve is very active in manipulating the market. Channeling my inner Jakegint, I believe gold/silver will be the safest way to play the Fed’s manipulation. Stocks like VHC, SWHC, and others, will serve as ‘special situations’ to help kill the time as the market bleeds itself dry.
In short, take any respite in the market as an opportunity to get out, for the fiscal cliff is nearing and no one gives a shit about your money anymore.
http://www.youtube.com/watch?v=FdCpbTP1VIM&feature=results_video
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Who’s Jakegint?
Haven’t read you write about a rather intermediate bearish scenario since you wrote about throwing hot pizza slices and DD coffee at your Trader Servant as you were on the way to Romania.
Even a GLORC might not save us?
Which reminds me, Happy Anniversary to iBC.
How about some old fashioned TLT?
How much more in taxes are you gonna have to pay Fly? (you know its coming. are we gonna have to take-up collection for you? just say the word!)
#TAXATTORNEY
“They want to take from us and give to them–a recipe for mutual destruction.” I feel like whenever the subject of paying a bit more in taxes (or not getting a bailout) arises, the cry is always that everything will crumble and we’ll all be destroyed. You’d hope so. That could be true if we’re talking about job creators or entrepreneurs, but in the case of the financial complex, effectively the equivalent of lottery-winners, society couldn’t take enough from them.
The government has gone on & on taking from the middle class & giving to the wealthy– mostly subsidies to huge mega-corporations like oil companies & military industrial complex companies. Obama wants to keep doing that for the most part, but allow the middle class to keep just a few more of their peas. And for that he gets called a socialist.
Correction: He’s a puppet of the United Nations, which is a puppet of the central bankers (IMF and World Bank). All of these fuckers are pushing Communitarianism, the “Third Way” political party. It’s a mix of communism and capitalism.
Frog, what don’t you get about the fact that the tax increase is going to increase MY taxes too? I’m a full-fledged member of the middle class, I’m pretty sure, and I know for a fact that when everyone’s taxes go up, in addition to the tax on dividends, my taxes will go up.
So where do you get off spouting all this crap that it’s only going to take from “rich people” who make so much that it’s a drop in the bucket to them?
And Frog are you aware that certain companies in certain fields can only survive due to INVESTMENT from rich people, and it sometimes takes a long time (sometimes many years) for those investments to yield a return? And so if all those people have less to invest, that will HURT people like me whose employment depends upon the existence of companies who are hiring?
BUT HAVE NO FEAR, the lazy bums who don’t even want to work for a living and are too busy fathering illegitimate children, they will have increased amounts in their unemployment checks! Increased for what reason, I don’t know. And maybe they’ll get another free Obama-Phone. The Obama-Phone 5 is coming out.
Some assbackwards solar company that cannot compete with China will get an unsustainable infusion of cash and obama’s political cronies will line their pockets. Yay, shouldn’t we all feel great about that?! At least those pesky rich people have to fork over some more of their wealth
Fly – any interest in DVAX, given the FDA panel this week? I’m sure Henry Fool is loaded to the gills.
Fly we know your disdain for auto stocks and I don’t want you to buy them. Do autos and other entitlement favorites like healthcare meet your special situation criteria?
Higher taxes will be offset by America’s economic engine being ignited. The next several years are going to be a boom period.
President Obama will take credit for coming into a disaster and going out with a boom… but Boenner and the GOP will insist it was their power of Congress that did it.
Can’t wait for candidate Rubio to shout it out that the GOP is responsible for this boom.
That must be some good crack that you’re smoking.
Just remember who told you first, it was “Bullish”.
Bullshit
Clever spin on words… I never saw that one coming!
I’m rooting for Bullish, but betting against him.
PS The Fly’s post is timely and insightful. I don’t know where else one could get this kind of intelligence, except for right here at “The iBC”.
12 second clip
http://www.youtube.com/watch?v=QS0m9A3iQCI
Neither Wall Street nor anyone else cares about the deficit at all in practice, although they may whine about in order it to blame someone else for it.
Everyone wants lower taxes & more bailouts, subsidies etc. for themselves. Only if the budget can be balanced on the backs of other people does anyone want a balanced budget. No one is actually willing to make any sacrifices themselves in order to balance it.
Least of all, Wall Street.
The idea that sacrifice needs to be made to balance the budget is a fallacy and counterproductive. Quite the opposite is true.
All govts worldwide have the power to issue their own notes to pay off their own debt with zero repurcussions. The sacrfiice scheme is brought to you by a coalition of corrupt politicians and private central bankers.
America is dead. Finished. Get over it, welome to the New Amerika.
Who is better off in the New Amerika? The 45 yr old mid-level manager of a small business making 65k a year working sixty hours a week so his wife can stay at home and raise his three kids with a thirty year mortgage, or the crack dealer in south Philly with three girlfriends and ten kids that don’t know his name collecting SNAP, medicaid and subsidized housing?
You have answered the question correctly, now adjust your lives accordingly.
Election Play continues..Strong Dollar and Weak Oil.
Odds of an increase to the top corporate marginal income tax rate of 35% in the next 4 years is less than 3.5%.
Buying AGQ in the morning to hedge. I will keep all of my long positions. No fear here. Part of the Communitarian wealth redistribution plan is the ongoing dilution of the US dollar. All stocks will continue to rise.
When the Tavistock Institute coordinates a financial news message such as “fiscal cliff coming,” you know it’s bullshit.
Brave. Considering this is america and not some bend over and like it eurotard country, your confidence in the smooth transition to socialism is commendable.
The transition is already complete. The Bank of International Settlements has identified the US middle class as livestock that needs regular scoail engineering to ensure the central banker credit industry remains intact. No additional volatility will take place since central bankers love their safety and control. They have already won.
Tend to agree on the “fiscal cliff!!” horseshit. It is the tax hikes and 0care birthing jan 1st. Is it priced in? Not so sure.
You fat cat capitalist war criminals will be sent to the progresive people’s reeducaction camps. I may have previously been misquoted as a regressive Romney and coal man. I regret my previous errors and plan to turn in friends and family members to make amends. I believe in rainbow unicorn power.
With true regret i also have found rainbow unicorn power the bees knees. All former unfortunately capitalist posts were a joke played on me by me. Karl Rove infected my brain with a tumor which the godlike Chris Matthews removed with the help of a womans turkey neck. Go socialism.
You are refering of course to the picture of 0bama hugging the crying, old white woman.
http://uk.news.yahoo.com/photos/sandy-barack-obama-sees-jersey-damage-photo-obama-hugging-sandy-victim-1-400×240-20121031-164606-067-234046253.html
“Back off or honey here’s dead”