iBankCoin
18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
20,422 Blog Posts

BIG MOVES COMING — Markets Are Broken

The Fed intervention in investment grade paper today caused everyone to jump into LQD and out of HYG and other ‘covenant lite’ bonds like LEVERAGED LOANS.

LOOK AT THIS SHIT.

Massive downside moves in banks — BAC off by 8%. The reason being is because those assholes own all of the debt — the leveraged loan debt and the oil and gas debt and all of the CMBS debt that fueled our wonderful economy for the past decade. This is a worst case scenario for banks.

HOWEVER, I am reticent to be short here — as we can see govt working OVERTIME to jimmy rig stocks higher. This will not save us — but the whips are vicious and if you get caught the wrong way — you’ll be fucked.

Today’s closed trades.

FAZ +10.5%
FAZ +8.2%
TNXP -15%
(ODP -11.5%)
SOXL +11.2%
SOXL +6.1%
FAZ +1.6%

I had a 2x position in FAZ over the weekend, booked it and went long SOXL at 2x because of an average down. I ended up on that too and finally swung around with FAZ and closed it out for a small gain. I was afraid to be short overnight.

I think we bounce, not because it makes sense — but because it’s rigged.

I’m also heavily long some gold miners, liking today 5% lift in gold and -582 on the Dow. This is a perfect time for gold bugs to shine.

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26 comments

  1. narcist

    “… govt working OVERTIME to jimmy rig stocks higher” but Pelosi is cockblocking all the “corporate bailouts” so… Haven’t even made it to the TARP vote moment.

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    • numbersgame

      If you are bettign on any person in Congress to be fiscally prudent with the taxpayers’ money, you’re fucked. No one ever was voted out of Congress for spending too much.

      Did the Democrats vote for the bailout in 2008? Will they vote for the bailouts now?

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      • narcist

        She will do what she can to tank the economy because she knows the median voter will vote against the incumbent president for a shitty economy.

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        • narcist

          Said median voter is most likely a Hispanic or a college educated white woman who voted for Trump in 2016 and will not cast the ballot because of Pelosi. Median voters are by definition not partisan and tend to have low convictions on the issues.

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  2. soonerxii

    cheap oil will be will certainly help the miners

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  3. discoordinated

    Ironic, you are trading it well and yet probably still feels like a nightmare.

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  4. Orson

    Next stop for the TBTF banks, nationalization.

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  5. itsgold

    If fed starts buying stock, will that wipe out common shares?

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    • numbersgame

      It could if they wanted to, but the odds of that are slim to none, the real idea of CB stock buys is not to support companies/industries, but to instead support our Consumption economy via the wealth effect of 401ks. The Bank of Japan is just like any other stock hodler – except bigger
      https://asia.nikkei.com/Business/Markets/Bank-of-Japan-to-be-top-shareholder-of-Japan-stocks

      On the other hand, the Treasury can only buy stocks through a specific act of Congress (TARP, 2008), and Congress can write the bills the way they want. The bank sahreholders were NOT wiped out (but shoudl have been) with TARP. However, GM shareholders WERE wiped out, the bondholders took a haircut, and the auto workers took a pension cut (these 3 groups were given shares in the New GM)

      https://en.wikipedia.org/wiki/Troubled_Asset_Relief_Program

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  6. numbersgame

    It’s a gigantic house of cards in all lieklihood
    https://ibankcoin.com/flyblog/2020/03/23/no-predictions-just-trade/#comment-568529

    However, anyone pressing the short side shoudl take a look at this cahrt, on a 1-minute, 15minute, 1 hr, or 1 days timescale and read the damn tea leaves. Phase 1 of the Bear Market is finally over.

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    • numbersgame

      uum…this one..
      https://www.investing.com/indices/us-spx-vix-futures-advanced-chart

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    • narcist

      I’m ready to go increasingly net long.

      The Italian stats are confirming that the lockdowns have been scientifically sound.

      Fear will subside in the coming days.

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      • edge

        Careful with that. We are probably doing a worse job than Italy.

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      • edge

        I should be net long tomorrow but not for very long.

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      • moosh

        Lockdowns are great…who would have thunk it? It was a very timely global last resort experiment, after every made up attempt all the way to impeachment of a us president failed the big dogs finally stepped in. Maybe lockdowns will cure poverty, murder and the common cold to name a few

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        • heckler

          I’m not friends with anybody who isn’t happier now are you?

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        • narcist

          I am not following your logic (and do not see how impeachment is germane to the COVID discussion), but then I often find the words of right-wingers hard to decipher–perhaps there are cogent thoughts in them, however unlikely.

          My point is simple: The govts have finally put a lid on the COVID scourge via effective, scientifically sound policy measures, and the markets prefer science to Rush and Fox News.

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  7. tradercaddy

    I could have told you about oil crashing back in mid-Jan because that is when I bought my all electric car.
    Now for an encore I may buy a beach house and that’s when another major Hurricane will probably bury the east coast of Florida.

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    • bravo

      lol…hang in there tradercaddy. it could be raining cats and dogs and i would get hit in the head with dildos.

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  8. numbersgame

    Good you didn’t buy FAZ, Fly. Ackerman is the second billionaire hedge bear to drop 100% of their short positions and go heavy long yesterday like I did.

    1000pts on the Dow (and it will *hold* it this time)? Guaranteed. Looks like a +10% day might even be in the cards if bulls are lucky (If Senate bill looks good to go).

    You’re welcome.

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    • narcist

      Ackman, you mean? He’s a good Jew but too often says things that are blatantly self-serving.

      The next question is how long the bounce will last.

      That really depends on how the US handles the public health disaster in the coming weeks.

      Boris Johnson had his finest moment in his political career in his “Oval Office” speech yesterday. May very well be his finest moment of all of his political career when future historians look back decades from now.

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  9. juice

    This post aged well … and in this market, ageing well means overnight.

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  10. tjnyt

    Peace on earth, wish me luck. Was early on virus and so, early on the market, up today 40%

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