This is going to be a serious post–because money is serious. Two thousand and fourteen has been dreadful for me. The reason for it was the massive draw down that I took in March-April. Digging myself out from a -35% hole is nearly impossible. Aside from that, this market has been filled with ominous surprises.
I got March-April wrong, from an investment standpoint. But you can’t say that I didn’t warn of this October surprise, eluding to “the path of 2000” a few dozen times since May.
We’re Not Out of the Woods Yet– May 28th
A Late Night Message– July 1st
My Bearish Scenario– July 27th
The Only Reason Why I’m Not Buying Right Now– July 31st
Now is the time to sell– Aug 25th
Fall Back Son– Sept 7th
DEATH IS COMING -Sept 15th
It’s April All Over Again– Sept 15th
Ignore Everything But This- Oct 7th
I post 4 to 5 times during the day and I really like to get fired up on reversals. I have many stocks that are earmarked as long term investments, my personal cash. I also have trading accounts that are more short term. Over the past month, I went from 50% in TLT and utilities to a series of energy and tech stocks, only to stop out of them right before this last leg lower. Believe me, I took losses, but nothing like it could’ve been.
With the proceeds, I held about 50% cash and then bought into the Fed day spike. But, as you know, I didn’t chase beta. Instead, I bought ETR, WRE, HE, TRN and CLR. With oil collapsing, I instantly took hits in CLR and TRN; but the rest of the money, which represents about 35% of my assets, is secure. I also have about 5% cash left.
As luck would have it, one of my other large positions, CYBR, is up this week.
In summary, I lost money this week; but I am still standing and ready to buy these liquidations–when the time is right.
However, my thesis for most of the year was that this would mirror 2000 and the market would careen lower into the New Year. To be clear, I still believe this can happen. Nevertheless, nothing goes down in a straight line, nor up. And let’s be honest with each other, saying “this time is different”, pertaining to the sell off, has been a really bad strategy since 2009.
I know, this time ‘really’ is different.
TLT is the safe haven because there is a flight for safety. This is a classic bear market trade.
Commodities are in the penalty box and have been for sometime. This speaks to global growth slowing (extra Keith).
Utilities and REITs should perform, as investors flee high beta in search for yield. The higher TLT goes, the more attractive ETR gets.
One last point: why aren’t I short?
Because I’ve studied bear markets and have concluded that I could make double digit returns in utilities, without having to risk my face being ripped off on an upside surprise, especially during wholesale market selloffs, like we had today.
Bottom line: I know a bounce is coming and I tend to get excited when I see one; but my overall opinion is one of extreme caution heading into the holiday season.
If you enjoy the content at iBankCoin, please follow us on Twitter
The Fly is God.
.
Clapton Is Fly !!!
.
Ah no, Alf (Mr. Ochmonek voice).
.
Gotta say … ya lost me, “zombie” !!!
.
…
OBSERVATION …
Verne Troyer has yet to enter the building !
—
BUT… he has been spotted In tha parking lot !!!
—
Be Careful Out There !!!
.
.
… Have a Good Weekend !!!
.
That’s interesting. He must be a hard guy to spot.
.
He is literally 2′ 8″ tall so … YES !!!
.
http://www.youtube.com/watch?v=ML3zaY5FZ9E
I appreciate the serious post….as I find myself deeply contemplating todays moves.
Ive had a good year but, twice this year, i chose two “go all in” moments. Both turned out to be horrifically disastrous.
I suspect we rally for two weeks and then begin a bear market in earnest. Nevertheless, I am now majority in cash, and will raise m more for the next couple of weeks.
I won’t go short.
Ebola is the top for biotech. Just like the boogymen is the top for defense. New leadership is coming. Only thing that is certain is it will not be fucking Apple.
Fly is a true mensch. He lives and sleeps this shit. Brutal market out there, but he’s still sticking his neck out there in the wee hours of a post-gruesome week. Tip of the cap…
Agreed. Thanks for the post fly.
Looks to me like mid 2007 here or perhaps 1999. Russell more like 2007
No way u actually have any clients the way u trade and lose money just saying
If Russia makes peace with Ukraine and the ECB embraces QE mixed with the improving US economy, growth in corporate earnings and a mid-term election year. Top that with people calling for an actual crash (extra keith) when stocks are fairly valued while China and India are in the midst of economic revolutions.
Stocks are “fairly valued” my ass.
When the PE Ratio of the market is six or seven or ten, you can get away with calling it “Fairly valued”
You’re an idiot.
When has the market ever traded at a 6 PE, besides the great depression??
In 1917, 1918, 1949, 1950, 1980, 1982. And why do you qualify your argument with a “besides the great depression” irrelevancy, and why didn’t you include my FULL statement “six, seven or ten”, and just say “6 PE”?
And tell “Jesse Livermore’s Ghost” that he is a fuckin’ MORON. I dont wanna waste
energy on a sepearate reply.
You’re right rigged, I should have mentioned 7 and 10 as well. Nonetheless, how are those relevant multiples? We haven’t traded at a 10 multiple since 1985. Are you saying stocks have been overvalued since 1985? Also, I bring up the great depression because I can’t imagine a market that trades at that low of a multiple besides a great depression type era.
Good answer. In my opinion, we have been MOSTLY overvalued since the late 90’s. Though of course at times (March 2009) we have been undervalues.
I think a 13 PE ratio is a fair middling PE ratio, where is is safe to be say 78% stocks.
Fair enough. We aren’t far off. I think 13-15 area is fair. Good chat rigged, enjoy your evening.
Obama spokesman says Russian sanctions may end in weeks(Read: after Nov elections). If true, one economic headwind down. Next headwind to go is EU “austerity.” EU QE + end of sanctions= BIG rally.
I agree, you think possibly another 100 points of downside in the SP?
What is this guy doing?
There has been raging trillion dollar stimulus, Japan, and one after the other, Europe. What is this guy, doing
US criticises lack of action on global economic recovery
AP October 11, 2014
The US treasury secretary, Jacob Lew, said governments in Europe, Japan and China were failing to deliver needed support.
Yeah, Japan’s negative interest rate isn’t low enough. Come on Japan, you can do better. We need to keep this carry trade going and you need to be lower than us.
I started a position in UCO Friday morning, gambler’s play I know.
Well done, sir!!!
Is there a good source to find out about algos? If algos win, win, win how come smart guys like Fly aren’t algos?
Algos are based off of support and resistance. Trend lines help define that, other points must be considered, but they are a good start.
People try to ignore easy things like support and resistance and then lose money. The algos make money off of these people.
Support and resistance are formed at levels that burn most traders because of the varying levels.
The constant bid of QE created a modified support structure, resulted in a positive 45 degree slope trend. ZIRP had almost nothing to do with this at the time, might help maybe in the future.
Basically, without QE, for now, the market is fucked. Europe’s QE is the wildcard. I doubt it will be used for US equities as much as ours was though.
Don’t delude yourself.
Also, don’t worry, QE4 will come.
Then it will end. Then don’t delude yourself that anything like that will ever come back in your lifetime.
why soooo sSSSSSeRiOuS ? (joker laugh)
what do you think of Jeff Rubin, and his new oil target of 40-50 a barrel ?
time to get short (Xtra fullscale vern troyer) until next QE commences,….
where oil goes, mr market now follows
why arent you taking advantage of ebola festivities ?
http://www.financialsense.com/contributors/chris-puplava/burden-proof-shifted-bulls
Note that Chris wrote about the bottom being in 2 weeks ago.
Le Fly,
Didn’t I tell you that they fuck everything up in TX. First case of Ebola contraction in TX. Hicks…all of them.
> First case of Ebola contraction in TX. Hicks…all of them.
What is your problem dude? Calling people “hicks” because they are from a particular state, grow up little man.
Incidentally Livermore, I only say online what I can back up in person. As a Texan, if you called me a “hick” in person, I guarantee you would end up looking up at the ceiling and find yourself waking up in a hospital.
with a statement like that,…
you do realize you sounds just like a hick
You Ebola loving hick.
I’ll bet you chew tobacco. Spit on your own floors, drink coors, are fat from too much barbecue, use”ya’ll” in every sentence, yell “yeehaw” at least once a day, square dance, wear a t-shirt with you flat gut hanging out, and suck cock like a champ.
.
You are an IMBECILE !!!
FU !!!
.
.
Although, given the embarrasing spectacle of Rick Perry (the Governor) I am not surprised people have that impression of the GREAT STATE OF TEXAS !
—
Know this … not everybody in Texas is a Rick Perry CLOWN !!!
Some of us down here are fighting to change that perception !
—
.
GO WENDY DAVIS !!!
.
I must have hit a nerve here. Your avatar is probably a real picture of your grandfather out on the ranch in tumbleweed TX. Ya’ll come back now, ya hear? What a dick slapping state. Would you please secede from the union already?!!!!! You embarrass the rest of this fine nation.
.
Texas is a GREAT STATE !!!
.
Medically !
Economically !
Culturally !
Musically !
Recreationally !
B B Q – tionally !
—
FUCK OFF, FUCKWAD !!!
.
HUSSMAN: Here Comes The Stock Market Air Pocket
FORGET THE ARGUING-WE’RE ALL GOING TO SHOOT OURSELVES!!!!
GOD BLESS ALL OF YOU-YOU’RE ALL WONDERFUL CHILDREN OF GOD-BECAUSE WE’RE GOING TO BE HOLDING HIS HAND VERY SOON-OUR DEAD, ROTTING CORPSES LEFT BEHIND HERE ON EARTH!!!!!!!!!!!!!
Texas has higher rates of dropouts (1 in 4), highest rates of obesity, heart disease, cancer, murder, execution, 5th highest in teen pregnancy out of 51, highest rates of uninsured kids, and they rank 3rd highest in HIV cases in 50 states
http://www.cdc.gov/nchhstp/stateprofiles/pdf/Texas_profile.pdf
so i ask,.. how can texas be so great
you talkin to me?
I get it. You are the guy who missed the whole upmove from 2009! lol.
That comment was for “rigged game” No shit the game is rigged. You have to learn to play it asshole.
Ebola bambola buloongo baboonga damoy toomba bamrooga gamnoora
Marked dove a little after the close Friday and it’s opened down Sunday night. /ES is at 1883, down -11.25
This is the type of action that would often catch people shorting into the hole at the open and then getting faces ripped off. Shorting the hole since 2009 has been a huge moneyloser. This time different? Wish I knew.
As a bear, I’d like to add shorts but really don’t want to get my face ripped off. There are probably a lot of other bears feeling the same way.
Bears being so trained not to short the hole, maybe this is the time to do it. Dangerous though.
That’s why you pick your favorite short like TSLA and sit on it.
HUSSMAN: Here Comes The Stock Market Air Pocket
GOD HELP US ALL!!!!!!!