SANTA OR DIE

This is it folks (extra Denninger). We’re either going into the cesspool of hell or hopping aboard the “deathsled” to bestow a great pain and misery, a final blow of sorts, to the childish morons who continuously short this market.

Last week the tape was weak; but you wouldn’t know it by reading iBankCoin. The Option Addict pulled off one final “epic trade” for the ages, getting long massive quantities of TWTR December 50 calls, all done under $1. Some of his members, inside of After Hours with Option Addict, got in sub .20 (+6,500+). Do you know where said options are trading now?

Almost $10.

Jeff bought a house with the proceeds, literally.

Just to put this trade into perspective, had you dropped $5k into the TWTR calls when he suggested, those same calls would be worth over $65,000 today.

Isn’t this what we’re here for? How many of you made over 1,000% on this trade?

Congratulations to all of those who participated in this trade (tips hat).

As for my BALT position: I believe the Morgan Stanley analyst has it all wrong when he says GNK is an overhang on BALT, keeping the shares down due to uncertainty. I believe GNK is negotiating a pre-packaged bankruptcy and such an event will not affect BALT equity holders. Why else would Centerbridge take a 14% stake in BALT, just last month? They are most likely working with GNK on the bankruptcy details.

At any rate, I expect trading to be thin and volatile, as most hedge fund managers move to cash to lock in great gains. After all, these gents would like to get paid their $100 million bonuses. Any hedge fund related sell off in December will most likely result in a January boom, so hang tight and pick your battles carefully.

I bought MOAR BALT, as it lags behind the ripping hot shipping sector because I am Shabba Ranks.

They must read me.

Shipping is at the start of a two- year rally, led by advancing rates to haul coal, iron ore and grains, as fleet growth slows and China’s strengthening economy boosts cargoes, Morgan Stanley said.

Demand for ships will expand at a faster pace than vessels in 2014, the first time in six years that will have happened, New York-based analyst Fotis Giannakoulis said in an e-mailed report today. He upgraded estimates for the industry to “in- line” from “cautious,” and said demand for ships to haul everything from iron ore to grains will benefit most.

The more positive forecast mirrors wider predictions by shipping analysts that the worst of an industry rout is ending. Rates for 10 out of 11 commodity-carrying ships will advance next year, led by a 53% rally for Panamaxes hauling coal and ore, according to the averages of more than 50 analyst estimates compiled by Bloomberg News.

“We see a 12- to 18-month window to play the cycle,” Giannakoulis said. The industry’s recovery will last two years after which vessel supply will quicken again. The rally favors owners and operators including Diana Shipping Inc., Safe Bulkers Inc., Knightsbridge Tankers Ltd., and Star Bulk Carriers Corp., he said.

While China’s economic expansion will slow to 7.5% next year, the weakest since 1990, its growth will still be more than three times the global average, according to economist estimates compiled by Bloomberg.

Fleet growth will decline to less than 5% next year and lower than 4% in 2015, Giannakoulis wrote. That compares with demand expansion of as much as 6.5% in 2014 and 5.5% in 2015, he said.

Source

Indeud.

http://www.youtube.com/watch?v=BVH5ZRtsyAc

One of my largest holdings, GIMO, is having its face punched in today. I much rather not talk about it, in favor of a little chinwagging about the prospects of the dry bulk shippers. However, in an effort to publicly disgorge myself, I think it’s only fair to mention the evils that plague me each and every December.

Last year, around this time, I was beaten like a red headed step child in DECK. I ended up selling the stock, in true cowardly fashion, in the $30’s. Look at her now, in all of her beautiful furry fashion! Today I am being mocked in GIMO.

Now, there isn’t any news, per se. There was an initiation of coverage, and a price target of $28, affixed by some boiler room in NYC. There’s also the expiration of the lock-up period happening today, which lends to the overarching bearish feeling in the stock. But the truth is a little more simplistic.

Let me explain.

The bombastic decline in GIMO, the unexplained and mysterious 9% drubbing in the stock, has occurred because Devils are chasing me, attempting to extract my life force, and by extension, destroy iBankCoin. There isn’t any other rational explanation as to why this is happening today, following my ALJ debacle and subsequent set back in RBCN.

All in all, I am down 13% in GIMO and should be selling it right now. Truth be told, I had limit orders in to sell my entire position yesterday, but never got hit.

HOWEVER, you know, as well as I, the moment I sell the stock will mark the exact and precise bottom–as was the case with ALJ.

Therefore, I am putting you on notice, that I have initiated a brazenly irrational approach to dealing with this fresh setback and cannot be trusted upon for cogent, well though out, considerate advice.

The shipping industry is currently my favorite. In an effort to dispel the notion that my BALT isn’t holding its water, I’ve compiled some statistics, for your fat faces to chew on, while devouring the donuts that litter your filthy desks.

sorted by % away from 52 week high

Sorted by 2 week return

Fannie Mae is the biggest winner of the year, with a YTD gain of 1,000%. Within the small capped universe of grotesque degeneracy, there are numerous triple figure gains. The population is too large to count, frankly, with the SPY +30% for the year. On the downside, once again, are gold and silver stocks. Perhaps they will bounce in 2014.

In an effort to shrink the universe of winners, I screened for stocks with market caps above $5 billion. Here are some of the highlights of 2013.

TSLA +325%
RAD +310%
NFLX +303%
MU +255%
NUS +252%
BBY +247%
ALU +238%
SFUN +196%
INCY +192%
IEP +182%
QIHU +172%

Biotech, casinos, chinese burrito stocks: risk was certainly on in 2013. All of the riskiest names soared, as investors kept climbing the wall of worry. Without a doubt, 2013 belonged to Carl Icahn and his incessant punching of the face of a Mr. Bill Ackman, whose fall from grace was nothing less than hilarious. It’s a mistake to believe the trends of 2013 will be the winners of 2014. Often times the biggest losers turn out to be the biggest winners.

What sector will catch fire? Will biotech continue its run or crash into an FDA jackhammer? My favorite thing about investing in stocks is doing the investigation and fixing on a thesis. Early on in 2013, my thesis was to be long Japan. I was exactly right. At the time I was long SNE around $10. Looking at the list above, I was long NFLX and MU in great quantities, but failed to “hold my butter”; and as a result, I missed out on the run.

For 2014, I am committed towards the procurement of ‘massive winners’, most readily seen in fairy tale books or passed along through cartoons and fictional books. Failure to accomplish this will result in “ultra-violence” being hoisted upon the innocent readers of this site.

Oil and gas stocks were just the marvel of the market; now they are the bane. With them, naturally, are solar stocks–straight down the toilet bowl. Playing The Devil’s advocate, I am going to assume the sector will bounce back, especially since the price oil still stalks the $100 level.

Let’s have a look at the carnage, shall we?

Any favorites?

This market is a buy, right here, right now. This is the easy part of this job, buying when everyone is running for the exits. Lucky for me, thanks to NSTG, YELP and BALT, I haven’t given anything back this week. As a matter of fact, I am up.

Do yourselves a favor and get long, with teeth. You will thank me later.

This sell off is sponsored by a stronger American economy. Wall Street deserves to be punched in the face for selling stocks because the Fed crack pipe might be taken away. Although I love POMO as much as the next man, it is plainly idiotic to be bearish on stocks due to a strenghtening economy.

With some of the proceeds from my NSTG sales, I added to YELP this morning. I realize the market looks bleak and the world is crashing all around us. But oversold markets always look this way before the turn– and I am constructive on my position that Santa Claus will indeed present himself to Wall st this year, smashing the stupid faces of bearish children around the globe.

Off to the gym.

Let’s get ahead of the curve, shall we? Today, SALT is coming public. They are going to raise over $250 million for the explicit purpose of buying Dry Bulk vessels. Its been a long time since a dry bulker came public. I want you to pay attention to this, as it represents a sea-change in the sentiment that has been decidedly bearish behind the chinese wall at our finest investment banks.

This brings me to my next point: Dry Bulk shipping rates are up again this morning.

Let me ask you a question. Why would DRYS cancel an “at the market” financing for $300 million? The answer is childishly simple.

a. they believe business will pick up, appreciably.
b. they feel their share price is undervalued and would prefer to initiate an “ATM” financing at higher prices.

DRYS owns 10 Capesize vessels, and over 40 vessels in total. BALT owns 15 vessels, with an option for another 2. Of the 15, 4 are Capes. With capesize rates approaching $40,000 per day, thanks to a late year push to deliver vast amounts of iron ore to China, both of these stocks are buys. I also like PRGN, but haven’t done much work on it yet.

As an aside, fat women have ruined LULU. Chip is gone and the shares are reeling following a bad quarter. This sell off will likely represent a buying opportunity, but not yet.