Happy Thanksgiving — You’re Gonna Get REKT Tomorrow

Good afternoon lads. I’m drinking Apple Jack’d today, cooking my world class winning stuffing. The bird nearly got burned and has blackened quite a bit, mostly because of the Apple Jack. But I think it’s still edible and even it weren’t, the Apple Jack will ensure that it is.

Moving on, I see European markets are being terrorized and our futures are down 162 points, which means you’ll be REKT tomorrow, rightfully so. I know what you’re thinking, “wait right there fucked face, don’t you move a muscle until you explain your TNA position.”

Fair point and I will explain it now.

When I was a wee lad my window used to face the front of the building where all of my friends played. When I was sick, I was tortured by the sounds of their laughter, pining to be out there swinging the bat and driving line drives into the faces of my best friends. Often times I’d trick my grandparents into thinking I was better and I’d head outside and play tag, manhunt, and all sorts of games.

I don’t like missing out on fun and get envious of other people partaking in hedonism, which I feel is my right by birth. As such, whenever a party breaks out, I try to gain exposure. My TNA purchase on Friday was a 10% position — but I still have 75% in cash. Ergo, when markets open for trade tomorrow and you’re there lamenting over being lamb’d into a margin out moron portfolio, find solace in knowing there are smarter men out there, like Le Fly, 75% cash, dressed to the nines, imbibed with the elegant vapors of Apple Jack.

Happy Thanksgiving and drink well.

I have many things to do today and will be cutting my trading day short. I acquired a 10% position in TNA to go with my 10% position in TMF. I have one other position that cannot be sold because it’s illiquid. The rest (75%) is in cash, awaiting bloodshed and carnage come Monday. If wrong, I will harvest profits in TNA and tip my hat to you a good day.

God willing, The Capstone Programme will be launched on Black Friday, although I’m reticent to commit to such a date due to last minute technical difficulties. For those just tuning in, this is the highest level of service I can ever provide for the plebs — a white glove, one on one, service to educate and mentor traders, correcting their hazardly ways and setting them onto the path of success.

Details will be forthcoming.

Safe travels and be sure to drink copious amounts of liquor and vast amount of turkey. For those who want to read it again, A Gentleman’s Guide to Thanksgiving Decorum.

I LIED.

I bought some TNA here, looking to sell out of that shit at $62. I’m giving Santa a chance.

Discard today’s gains as a national obligation. I read somewhere that stocks trade up 85% of the time the day before Thanksgiving. Often times we rally and then trade up the day after Thanksgiving, only to be severely whipped at the gibbet the following Monday.

The issue with buying today is you’ll end up getting ravaged on Monday. I’ll be avoiding this session, playing spectator mode, preparing for National Feast.

Lost of stuff to do today, such as make stock, brown sauce, dark and blonde roux, slave away at the house in preparation for company. The day before Thanksgiving is always a busy one at House Fly and I’ll likely be up till 3am putting the finishing touches on things.

Enjoy today’s respite and use it to lighten up your exposure, especially if you’ve been hammered into the ground.

As an aside, tomorrow will be the coldest Thanksgiving in NY in 117 years.

We’re oversold. We’re so oversold, it’s scary. Scary for you — I really don’t give a shit. We have a vapor locked menace taking place in the crude and equity markets and there’s nothing you can do to stop it.

You might feel induced to buy dips and you might even enjoy a 100 point rally throughout the day; but the trend is, inexorably, lower. Those are the facts on the ground, losses on top of losses, an auto-catalyst that has taken the hopes and dreams of Turkey fevered Americans and CRUSHED THEM INTO THE GROUND.

The aspirational and the weak have been turned into pillars of salt, bearing witness to their portfolios being destroyed.

If you didn’t play this recent downturn perfectly and have losses, you’ve lost the privilege to buy into the blood. Got it? You blew it, myself included. If I was short more semis and had more cash and didn’t lose 4% yesterday, I could buy today. Instead, I am 85% cash, long 10% TMF, holding my dick — doing nothing.

I’m not buying this shit and I’ve been doing this forever. Markets do not respond well to illiquidity and poor technicals, which is exactly what we have now — a witches brew of indecorous ruin just around the bend.

If you’re reading this and have listened to me before and I’ve served your interests well, heed my warnings when I say “go eat a sandwich” and “stay the fuck away from the market.”

RIP 69. It was fun while it lasted.

Everything about the open and the subsequent rally reeks of a bottom. You get an opening flush, the weak are disabled and killed, eaten by the strong — life goes on. But this drop in crude, although clownish in its demeanor and candor, is alarming.

There is a thousand reasons for the drop — but the only one that counts is economic weakness.

For the love of God, we’re about to get tagged with a $4 handle on WTI. How can you sit there idle?

I know, bull markets are often nourished with the blood of the coy and the stupid. This is how Commodore Vanderbilt made his fortune. But I must say, this does have a feeling of being too good to be true. I just got done selling out all of my stocks yesterday, so I think I’ll pass on buying the first dip.

I bet Tom Lee was never mentioned in a headline with the Fed. Consider this a bucket list item for him.

First on Clown Lee.

Now on the Fed.

This from Cramer now.

“If the Fed moves in December, you’ll wish you sold at these prices,” Cramer said on “Squawk Box.” “There’s nothing good here.”

Agreed? I do. Bad opens like this sometimes cause a capitulation bottom. But words cannot express how important it is for Goldman Sachs, errr, the market, that the Fed halt hiking rates.

If the Fed hikes in December, markets die. Trump gets kicked into manhole. If Fed pauses, TLT shoots higher. Actually, I think the market will lift TLT regardless. The point I am trying to make is the days of the dot plot are soon coming to an end. Bonds are cheap and my $TMF is gonna lift today.

It was all fun and games until you lost a trillion dollars in an asinine acronym based investment plan. Blame Cramer — he started this shit with FANG. How many people got lured into those stock predicated upon the marketability of its catchy acronym? I bet a lot.

Thusly, losses are exaggerated to the downside, especially for mega cap tech, because of investor concentration.

Market capitalization losses since their 52-week highs:

Facebook: $250 billion
Amazon: $255 billion
Apple: $222 billion
Netflix: $63 billion
Alphabet: $155 billion

As soon as the market opens, losses would have exceeded $1 trillion since the top.

This is sort of an obligatory post and I do not mean to rub salt in the wounds of crypto-FAGS. Look, you had plans to upend the dollar hegemony. You got bold and then permitted the system to trade futures on your little currency. Every since then, it has been straight down the shitter.

Mistake #1 thru 1 billion, never trust the guardians of the dollar with your bullshit computer money. Exactly one year ago, the cryptos were the talk of a generation — now they’re the noose from which many young and aspiring investors took their first major L. I do not find solace in that at all and wish you well throughout your investment career going forward.

Equity futures are sharply lower, after Target reported bad numbers. This is not a situation to be envious of, for equity longs. The market is so tenuous now, we’re literally dependent on retail numbers to set the mood. Yikes.

Nasdaq futures are down 90.

Yesterday HUBS had the second largest single day decline in its short history, running up to Feb of 2016. We’ve entered a paradigm of auto-catalyst where selling begets more selling. Liquidations are happening and it’s prevalent. This is the part of the narrative when valuation starts to mean something.

Where do we find a bottom?

Let’s pick a sector that possesses the spirit of the market and then the stock that could be considered the benchmark. I’m going with SAAS and CRM.

Over the past 13 years, the historical median PS ratio is 7.8x. Back in 2016, CRM traded at 6x. If we were to create a price target funnel of maximum downside to a point where valuation gets attractive, given we’re presently trading at extended levels, we’re looking at $92 to $109 — based upon current sales. Now if that S in the P/S ratio should move lower, then we have to adjust. I’d be a serious buyer inside that funnel, betting Wall Street’s diabolical algorithms are pre-programmed to start buying stocks like CRM at historically attractive valuations.

Data courtesy of Exodus.

I’m never sure if corrections are real or not, while enduring them in real time. Ten out of ten times, they feel like the end of the world. It’s only with the benefit of hindsight that we find out how stupid or smart we were. Luckily for me, I have an archive on iBankCoin. You can dig into my records and bear witness to 100% gains in 2008, 60% gains in 2009 — and an overall market acumen very few have ever been able to communicate to others on a wide and transparent scale.

This is what I’m watching now to assess the risk, to determine if this is a real credit worthy event that will imperil the entire capital structure of the market, or a passing storm. After stocks go down, next is credit. When corporate bonds diverge from sovereign, there is an issue there. When FX markets get disrupted, pay attention — because there is no bigger markets in the world.

We haven’t heard about the Yen carry trade in some time. Should FXY continue to trend higher while corporate bonds and stocks low, you will hear about it all day long, damn it.

High yield bonds are getting killed. Unremarkable, aside from the fact that investment grade bonds are getting killed too, while TLT is going up.

The ultimate currency haven — Swiss Francs. The ECB chimps out when this happens. Watch it.

That’s all for now. Try not to stress out ahead of National Festival Day. Get small and stay that way until morale improves.