Refiners Back in Focus

With this morning’s move lower in WTI crude, the Brent-WTI spread is now more than $10 again. Just a short while ago Brent traded at a discount to WTI, causing many to flee the refiners, scared of their own shadows. However, now that the spread is widening again, Mid-continent refiners are back in play, the rage of Wall St.

As such, Goldman Ball-Sachs upgraded DK this morning. I expect all refiners to trade higher today, and for many weeks to come, which is why I went long ALJ on Friday (time machine).

Other refiners worth exploring are ALDW, TSO, HFC, WNR, PSX, MPC and CVI.

As for ALJ, with 29% of the shares sold short and spreads widening again, I predict extreme hardship for those embedded in a bearish position here. The stock can easily rise to a level seen just 6 months ago, or $17.

With the SPY +3.8% for the month of October, I think we can rule out a seasonal fall calamity. The last time the SPY went up 3% or more, during October, was in 2010, 2006 and 2003. After a strong October, the SPY traded flat in 2010 at 0.0%, up 1.98% in 2006 and up 1.1% in 2003 in the month of November.

HOWEVER, in December the mood turned quasi-pornographic, with +5.03% in 2003, +1.34% in 2006 and an outrageous 6.68% in 2010.

In other words, based on recent historical factors, the market is only getting warmed up now, setting up for a rather libertine end to 2013.

Fun fact: the market used to trade on Saturdays, from 10am to 12pm, from 1873 all the way to 1952.

(Click on picture for full article)

This story was written in August of 1929, two months prior to the historic stock market crash that led to the great depression. The moral of the story is, don’t get caught up in the rhetoric and trust nothing.

What more can I say?

I went deeper into leverage into the bell, buying ALJ. As my equity rises, so does my buying power. Hence, I made ALJ a 3% position today, with the intent to add to it. Crack spreads are improving. But more importantly, the BRENT-WTI spread is widening. There’s also a shot at some congressional epa type action that might ignite the sector on fire. If you don’t know what it is, I suggest spending this weekend doing some research, you lazy bums.

http://www.youtube.com/watch?v=weX2PeqnvVI

Fully recovered from yesterday’s barbaric losses of making just 0.3%, “The Fly”, ever so gallantly, sashayed (no HOMO, it was done with black coffee in tow) throughout his offices today, celebrating gains. His almighty positions in YELP and TRLA have, once again, yielding magnanimous results. All thanks and praise to the heavens and the Gods of stock for making these wins possible. I devour my enemies whole (no cannibal) in your honour.

I am pressing, mind you, ahead by 3% today. My good colleagues and peers over at 12631 and After Hours with Option Addict are basking in their own glory, as the company time machine is being used rather proficiently and without need for repair.

At the offices of Le Fly, as he’s famously known in France, the black coffee is flowing, rather freely. Gangster rap music is in abundance (extra bass), accompanied by the occasional symphony, preparing for the weekend ahead when unchecked hedonism will take place at The House of Fly. Prepare for healthy servings of the reddest meats and wines the world has to offer. As we unwind our positions, riches will be had for the explicit purposes of consumerism, the finest things in life (extra Treu).

Gentlemen, take your pocket squares out and prepare to use them to wipe the blood from your faces as we rip to shreds the very last bastion of pessimistic bearshitter, residing in the darkest corners of the earth.

Let there be light!

Amen.

Mass has ended. Go in peace.

UPDATE: I added to my NSTG position.

Just terrific earnings out of GOOG and MS. I find zero reasons to sell stocks; therefore, I shall remain committed, at an honest and respectable 130% long of my assets under management.

I am certain there are some of you out there who believe I am being reckless by utilizing leverage. Many of you are scared pigeons, flying around without beaks. “The Fly” doesn’t subscribe to courses of action that are of the cowardice vein. I want my gains and I want them to be oversized. Leave me inside Obama’s matrix, where stocks do nothing but levitate, thanks to the computer program BERNANKE.

I will enjoy gains in several stocks today, namely my largest position, YELP; which, might I add, is trading at a paltry 25x sales.

http://www.youtube.com/watch?v=61YbN5ECVdA

In the after-hours, GOOG humiliated analysts estimates and broke the faces of short sellers in half. The stock is up more than $70, well on its way to $1,000. During yesterday’s session, I lost money by only making 0.3%. This is an unequivocal tragedia¡

Two of my top 5 positions are involved with the world wide web. YELP is trading cheaply, at just 25x sales, while TRLA trades at an astonishingly low 16x. From my mouth to God’s ears, both names will blow the barnyard doors off analyst estimates and toss subsequent short sellers, looking for a ‘quick fade’, into ‘fag boxes.’

From time to time, it’s easy to lose the faith, become fearful of losing money due to success. A great man once said: “success has defeated you.” I do not take my success lightly and will gallop towards the enemy with the same zeal as the brave soldiers who scalped to death the men who were under the command of General Custer.

I am very disappointed.  I under-performed the S&P like hot shot hedge fund managers, Einhorn and Ackman, today.  I finished up 0.3% (BASTARD YELP and BALT), giving up more than 2.5% from the morning highs. Back in the morning, I was bragging on Twitter about “making your annual salary” upon a 0.2% move in my funds. I was living high on the hog, a glutton of extreme measures. Now I’m just a John Paulson, pathetic loser, underachieving into decadence.

I missed out and will pay for my discretions.

“The Fly” has topped out today. Run for the hills.

I should have bought FPP yesterday.

I was up 2.5%, now I’m down. This is what happens when you taunt the stock Gods with boastful talk of leverage and fat faced gains.

You get them taken away, beat to the chin and eyebrows, tossed in the streets.

I like my chances here, leveraged long, very long, into Halloween. That’s right, ladies and gents, “The Fly” is leveraged long at 130% of assets, pushing the envelope as far as he can, for the explicit purposes of gluttony. I want MOAR gains and I want them now. I don’t want to wait for them to fall into my lap; I want to snatch them, like a purse–from an elderly woman  in a wheeled chair.

Don’t read any further than the next sentence. My largest positions are YELP, BALT,TRLA, MODN and NSTG.

Now get the hell out of here.