It is Time to WATCH THE WORLD BURN

I stepped in and bought TZA — wearing my best funeral clothes.

Ramp Capital has been buried in his fucking wheeled chair. The bull market is over and now is the time of the bear.

Fuck the market and fuck Fed Chair Powell.

Aside from that, I’m thinking about eating a veggie burrito and maybe a little couscous.

Feeling good?

Great.

The sneaky bears did it again. First they purposely blew up XIV; now they’re targeting XIV. The only thing more diabolical, cunning, and malevolent, are Russians — especially during election time. It doesn’t matter where the elections are held — NJ or Mongolia — the Russians will be there to vote in your stead.

The Dow is barreling towards negativity. Early morning dip buyers BTFO.

Get your hedges and living will in order, gentlemen — for we are about to test NEW lows.

I kicked out of SECO for a fucking loss. The price action was abysmal and I have no interest in holding abysmal stocks. I am long OLED and happy with the levels here. But right now, the market wants to suck balls. Face it faggots, markets don’t bottom on Fridays.

Top picks: FAZ mobile, SOXS, TMV, OLED

And tenacity.

I have zero fear right now and I am prepared, fully, to speed chop carrots with my balls firmly placed atop the cold marble counter top.

I bought OLED here for a variety of reasons, none of which is remotely your concern.

Also, and this goes without saying — rates are creeping higher again. The interest rate boogey man is underneath your bed waiting to grab your feet when you get up for a glass of water.

I’m in a public place now — blogging hard and fast. I’ll be popping in and out today, so the best place to get my real time views on events transpiring is in Exodus. Don’t worry misers — I’m handing out fresh free trials thru Valentine’s Day.

Hit me up at flybroker at gmail.com for access.

This is probably the biggest fund to date closing down due to retarded risk management, post volatility explosion. LJM Partners suffered a gut wrenching 82% decline over the past week and closed the fund on Wednesday.

The email header to clients was: “LJM strategies have suffered significant losses”

Fuck that had to hurt.

LJM is a Chicago based firm who had ~$500 million in assets.

Investors in the industry are calling LJM among the most prominent funds to fall victim to the popular “short vol trade.” The trade had become profitable for many hedge funds, including LJM, whose “Preservation and Growth” fund posted positive returns every year except one since it launched in 2006, according to fund documents.

But the risk amplified this week after the CBOE Volatility Index, or VIX, more than doubled on Tuesday to the highest levels in six and a half years. The move caused an exchange-traded note called the VelocityShares Daily Inverse VIX, which was betting on continued calmness in the markets, to collapse in after-hours trading on Monday. Subsequently, Credit Suisse, which issued and managed the ETN announced that it would ultimately be liquidated. ProShares Short VIX Short-Term Futures also suffered massive declines after volatility spiked.

“Short volatility strategies, selling options and collecting premium, have been critically described as picking up dimes in front of a steamroller,” wrote Don Steinbrugge, the founder and CEO of Agecroft Partners, a hedge-fund consulting firm, in a blog post. “They generate very good risk adjusted returns until volatility spikes and then have the potential to lose most of their assets if not properly hedged.”

Tuesday’s client note, signed by LJM’s Founder and Chairman Tony Caine, said that the portfolio management team has been hedging “with as many futures as possible to attempt to insulate portfolios from further losses.” He caveated that their “ability to do so depends on market conditions and liquidity.”

“Our goal is to preserve as much capital as possible,” he said.

How’d that work out?

Bob Parker, formerly at Credit Suisse, now at Quilvest Wealth, used to be my favorite guest on CNBC Europe back in the day. I found his advice to be measured and pretty accurate over the years. Last night he was a guest on Bloomberg and offered his 2 cents on the sell off — saying nothing had changed from a fundamental perspective and although he didn’t know exactly where the market would bottom, this would likely be nothing more than a correction — since the fundamentals were still intact.

Not as fun as calling for end of day — but Bob is probably right here again.

Morning lads

I bet you thought we’d bounce today — you spoiled fucking brats. It was real easy to justify your existence with a market sporting a Sharpe ratio of 2.80, wasn’t it? Now with it going down and all, you’ll be exposed for the fraud that you are — an absolute faggot, absolutely.

The DAX is getting beat down this morning — off by 1.6%. The Russians are getting it even worse than that — down 2.3%. Here in America, land of the mentally retarded, futures had been +250 and its investors had schemes — but they’ve been dissipated and now they’re gone. Poof.

Dow futures are barely +12 and you should expect the market to get crushed today.

WTI is -1.5%, gold flat, copper -1%. The dollar is flat and Bitcoin is -4.5%.

Here are the other headlines.

Control4 upgraded to Buy at Maxim Group; tgt raised to $36
CVS Health downgraded to Buy from Strong Buy at Needham
NVIDIA target raised to $305 from $253 at SunTrust, Street high; remains Buy
Skechers USA target raised to $50 at Monness Crespi & Hardt
Ferrari to launch a share buyback program of up to Euro 100 million in common shares
Cameco beats by CAD 0.11, beats on revs
FireEye upgraded to Positive from Neutral at Susquehanna
Wynn Resorts downgraded to Equal-Weight from Overweight at Morgan Stanley
Mettler-Toledo upgraded to Buy from Neutral at Citigroup
iRobot upgraded to Neutral from Underweight at JP Morgan
Amazon said to be planning to launch a delivery service for businesses, according to the WSJ
3D Systems downgraded to Underweight from Neutral at JP Morgan
American Intl upgraded to Buy from Neutral at BofA/Merrill
Yamana Gold upgraded to Outperform from Neutral at Macquarie

If you think about it — it’s the perfect crime.

Now if I was a diabolical man with unlimited resources looking for a monster trade, I’d trigger Credit Suisse into covering their volatility shorts in a sparse after-hours session — thereby creating a negative feedback loop that would in fact force them to buy back more futures.

When volatility spiked earlier this week, that forced Credit Suisse to buy vol futures, which in turn created the situation that terminated and laid waste to XIV.

The ramifications of these short vol trade is still been sorted through. Many people believe it was as big as $2 trillion.

The subsequent result is a loss of more than $2.5 trillion in market cap — a full fledged market panic — and assholes in the comments section here telling everyone else it’s a gigantic nothing burger — to move on — because it meant nothing.

You, quite literally, have no idea what you’re talking about.

Here’s Cramer walking back earlier comments about moron traders fucking up the market in obscure ETNs.

This was a crime, planned and executed with precision — leaving everyone else with dicks in their hands.

Chinese markets are blowing up this evening, down nearly 5%.

There is a disruption in the matrix. All attempts to eject Trump from the Presidency have failed. Therefore, deep state troglodytes have gone to ‘plan b’ — crashing the Trump economy — LEAVING NO SURVIVORS.

Meanwhile, I am graciously opening up the doors of Exodus to the unwashed masses from now thru Valentine’s Day, to demonstrate my love for the underclass-underprivileged.

You’ll want to be in the Pelican Room for the action, believe me.

Email me for access: [email protected]

UPDATE:

You didn’t need to be a rocket scientist to play this correctly. You only had to listen very quietly, to the rumblings underneath your feet. A gigantic cocked tsunami is barreling towards you — filled with anger and rage for all of the months of complacency — a President who tweeted about stocks is a President who will one day feel its venomous wrath.

The cucks at CNBC have been wasting time, as usual. So I tune them out and drown them in a soundtrack of choice.

CNBC's coverage is so good. Here, have a listen. pic.twitter.com/k90KH2eegI

— The_Real_Fly (@The_Real_Fly) February 8, 2018

I have an idea where we’re going and it’s lower — rather immediately.

Expect a heart attack drop of 1,000 points tomorrow, closing out the week of hell — setting the stage for true panic Sunday night. A Valentine’s Day massacre is upon you. Fear it, else end up on the losing end of a pork sword.

With my money, I still have some oil stocks and one or two shit stocks — but I am now hedged — long TMV for the black swan failed Fed auction event and of course SOXS — because NVDA is a bitch. My most recent addition is FAZ — because I am hoping for contagion. Why not? After all, it’s a rather good thought and it feels good, so why not bet on it?

From my vantage point, the banks stand to lose largess sums of money from the loss of excess — the perpetual and never-ending stock market incline has caused many to become fat and bloated, narcissistic pigs who should be cleaved.

The XIV was the opening salvo into what will one day be described as “the greatest fuckery to have ever existed.”

Brace yourselves.

I noted the other day I was hearing voices in my head, regarding ‘retesting the lows’ — before the market could go up or collapse and trade lower with vigor.

These people are like a cult — religiously demanding that any market correction be tested at least once before resolving a true direction. If we test and break lower — we’re completely fucked. If we test and bounce, do bags of cocaine.

Right now we’re roughly 500 points away from the retest lows.

It’s all but a foregone conclusion: we will retest the lows. As such, I bought some FAZ here.