We’re not going to have resolution until the Italian election “crisis” is resolved. I know how people think and they’re fixated on Berlusconi and his nazi plans. This morning’s bounce was great, but now it’s gone and I am once again in the red.
The housing and consumer confidence numbers were also great, but pale in comparison to the horrors that Berlusconi and his fascist thugs will inflict onto Europe.
Do you realize how stupid this whole process is? How one event can cause so many overly dramatic responses from the investor community?
It’s the nature of man to hoard and protect what is theirs. People want to hold onto gains and will use any excuse to protect them. As such, here were are, stuck in purgatory, being waited on by stupid men with Italian accents.
I’ve divested the majority of my VHC position, reducing it from 30% to a little less than 5%. With much of the proceeds, I bought BX, USG, BZH and APO–all doing woefully horrific in this meatball of a tape.
I’m short CCL (the broken toilet) and AG. However, I am leveraged out to my eyeballs, exposed to the market. My net long exposure is about 105%. I am not doing this simply because “stocks have to trade up until tax day.” You misinterpret my hyperbole.
The very basis of my bullish position is the undeniable resurgence in housing. The timing of my positioning is optimal, from a seasonality point of view.
I have two primary tools at my disposal.
1. Idea, information flow, intuition.
2. Timing.
If I get the latter wrong, the former will be for naught.
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Housing looks good because its start point is almost zero.
But it is far from good except in very select neighborhoods, like yours…
Yes and No.
If we accomplish 1 mill new builds this year, we will be up 25% from last year, but still 500k from per bubble levels.
On the other hand, profitability at some material and home improvement stores have never been better. They are lean and flush with cash.
Should we get to 1.2-1.5 mill new builds by 2015, stocks like USG, TOL, BZH and FBHS will be significantly higher.
You are just bitter because you have no electricity in your little backwater
Houses are selling at a premium where I am and in a few days to weeks. Nothing stays on the market longer than a month. As a side, it is prompting the new yuppy buyers to either blow out these old houses and rebuild or remodel. I count a dozen garbage skows in my neighborhood filled with old sheetrock and wood whilst Central American’s scurry around doing jobs that Americans won’t do.
UPDATE:
Since I penned this post, the market has improved. I am now +0.3%.
That is because the Bernank finally finished his gobbledygook testimony. I’m gonna try to ride this bubble till she pops.
In other words you have no clue what’s going on like the rest of us.