Shut Up and Buy

Over the weekend I saw a great documentary called “Searching for Sugar Man.” For those of you who’ve never heard of it, I highly recommend watching it. It’s such an unbelievable story; it’s almost too good to be true. I won’t give away the storyline. But it’s an important reminder to never give up on dreams. I do believe we all have our own, unique, special talents. You just have to exert the effort and courage to make them come true.

Turkey is going “full mohammed” on their government. I wouldn’t worry too much about revolution there. The country is protected by a secular military, who will drop cluster bombs on powerful religious zealots, before ceding control of the country to them.

Futures are higher and stocks look poised to recover some of Friday’s losses. As always, at the first sign of weakness, I got scared out of stocks, turned all bearish, and starting reading Zerohedge again. I really need to stop over-thinking the market, trying to time tops, and just get long the names that I like. I can’t tell you how many huge winners I’ve missed out on this year, and over the past two years, due to fear of losing money. It’s more than that, actually. I want to avoid losses and time bottoms too, also a ridiculously hard task–even with The PPT.

Bottom line: I have a few names that are worthy of my time and I am going to buy them today.

I’ll tell you how, you stupid bastards. It goes lower. That’s what it does.

Down, miserably, in 5 of the last 6 years. You might be saying to yourself “self, but, it was up nicely last year, so it might do it again.” However, what you should consider is the fact that the market moved LOWER in May of last year by 6%. Therefore, the move higher in June was nothing more than a bounce.

Let it be noted, this year, the SPY closed up by more than 2% for May–leaving it naked for abuse in the showers by junior traders on Wall Street (extra homo).

Good night Lucy.

The Caesars who manage America’s money all went to the Hamptons this weekend and will stay there until late August. In there place are junior traders who are scalded with hot, boiling, coffee– if they should spoil the treasure. They are told, under the crack from a leather whip, “do not mess anything up while I am gone. I am off to party with pounds of cocaine and hookers. See you in the Fall.”

As soon as the senior traders and managers leave, the juniors set their goals on destroying said institution via really dumb trading, desperate to make a name for himself.

Yes, it’s true, most of this is occurring in my head, exclusively. However, I think it’s fair to assume, with the SPY +15% for the year, the summer is going to be a snoozefest. We should all prep ourselves for a different type of market, one that doesn’t bend to the caprices of gamblers.

I just can’t get over the fact that my FRO got shaved for a quick 70 cents inside of a week. I knew I should’ve sold some. But I am going ‘full maniac’ on this one, even though (and this is a very important though) I haven’t any formal expertise in the shipping industry. I don’t even know how to tie a bowen knot, let alone be onboard a shipping vessel and not throw up on someone’s face.

I like to believe my intuition and experience count for something, when making bold decisions. The truth of the matter is, the market doesn’t wait for logic. My rationale might be spot on– but is the time frame? We shall see inside of a year.

Aside from that, I’ve been dealing with my allergies to the Earth. I am not from this planet and do not like your pollen. Where I’m from, one can breathe the air without violently sneezing into the wind. I’d like to hit the person who invented pollen with a god damned shovel–right in the nose.

Just when I thought the cocaine addicts from CNBC could not hit a new low, they did it again. At the end of the trading day Maria Bartiroma and some other talking stick said “this sell off is the result of rebalancing.”

Really, stupid?

This sell off has NOTHING to do with end of month rebalancing. I cannot believe they are spewing this crap. Get to cash and get your defenses up, for the rollover happened when bonds rolled over.

This sell off is a result of a risk off environment in Japan, which threatens the yen-carry trade perversion. On top of that, interest rates have been spiking. See TLT. With that, REITs and mortgage related names are under pressure. These are the market leaders. The big cap dividend leaders are getting smashed too. You have to recognize when the tape becomes difficult and respect it. Don’t make asinine excuses for the sell off. There are many people on margin who need to be blown out.

Basically, the dumb money is being clawed back, as it always does through time. It’s been too easy for too long.

Watch Japan. Watch IYR. Watch TLT. Watch XHB. And don’t watch CNBC.

With the proceeds from my PAMT sale, I added to both IMMR and ANFI.

It doesn’t feel good having one’s $FRO deflated like this, long 1.2 million shares into what appears to be a death spiral. Clearly, the market is testing my resolve here, as I do not need to hold the shares any longer, being up in the high 20% range for the year. Me doing so equates to being a “maniac investor” and I wouldn’t have it any other way. With the types of draw downs that I endure on a monthly basis, it should come as no surprise as to why I do not manage a fund and instead have opted for an advisory role. People who toss money into funds do not like beta and I certainly bring a lot of that, along with the alpha.

The point of this post is not to bore you with cheap psychiatry sessions, but to inform you that people who bought gold and silver miners yesterday are complete fools. Listen to me now: the sector is dead. Buy the blood only, avoid the momentum trade.

My price target for IMMR is $20. God knows it will take a miracle for me to hold it that long. Look at RBCN today. Ughh.

I am looking at the REITs and they’re getting the old back of the trunk knife action. On the other hand, regional banks are doing great. They benefit from a steepening yield curve. Short RETIs-long banks? It might work. But I’d rather not sell short REITs, thank you very much.

The top two stocks on my watchlist are HOV and HBAN.

Oh, and MDB related stocks are getting poleaxed: UNXL, PAMT, CLIR etc.

Higher interest rates is bullish thing for certain banks. With the yield curve getting “curvier”, I like HBAN, KEY and CMA.

The market is soft this morning, but who knows how it will play out. Every dip has been a buying op. But, not all stocks are going up anymore. On weak days, 75% of stocks trade lower, making it much harder to bank coin off swing trades. Most people get frustrated and over-trade tapes like this. I’ve always found it to be useful to “stop trading” when the tape gets convoluted. My style of trade is not conducive with day trading, even though I can do it as good as anyone. But I need to take down big positions in liquid stocks, which is hard to do in a stock that’s gapping higher within a 2 hour window.

If this tape is hard for you, trade small and take some pointers from some of the talented day traders on the site: Ragin Cajun, Option Addict and Raul.

OVTI is exploding to the upside. I really like that name, evidenced by selecting it for my semi-managed GAPR index inside of The PPT. Using the algorithms and my opinions, I manage an index of growth stocks at a reasonable price (GARP), inside of The PPT, on a semi-annual basis. Year to date, it’s up almost 40%.

Top picks: IMMR

I can’t believe SYNM and MGPI popped today. You don’t understand, I monitor everything. I was “eyeballing” these two stocks in particular because they’re so lowly and lame. To this point, I took a trip into the “houses” of homeless stocks this evening, taking copious notes along the way.

The point of this exercise is to identify these small pieces of offal before they “go mansion” on the markets and buy condos near the shore for themselves.

Here’s what I have so far. If you were smart, you’d affix alerts to some of these names, geared towards momentum (I use 2%+ for the session).

GEVO
GSAT
CPRX
PSDV
PRMW
AFFY
END
AMRN
DNDN
CYTK
ZIOP
VICL
ACRX
NLNK
ACHN
MM
IMI

Note the over abundance of mad scientist stocks, doctors making medicine to kill people instead of making them feel better. Always be careful of the FDA when playing these stocks.

We went from solar to boats to alternative energy stocks to silver and now to alternative fuels. Shares of SYNM and MGPI are skyrocketing for reasons unknown to the sun, moon and the stars.

REITs are getting smashed again, which is good for prospective buyers–negative for everyone else. All eyes on Japan tonight. After that 5% beat down, 15% over the past week, they need to rally the NIKKEI. My bias is to be cautious in the face of these issues. My boat stock, FRO, got crushed today after bad earnings. I always thought they’d report bad news. This is a multi quarter play, not some magical shift that occurs overnight. The boat trade is dead. If you’re not long term, sell now and allocate funds elsewhere. I am holding my shares.

IMMR helped hedge me against the FRO loss; but I am still down about 1% for the session. Being that the market is up and the stocks I sold are up, my 45% cash position is actually hurting me today.

I can only hope for a further shakeout in the market, so that I can do some buying.

After looking around for some ideas, I find myself too conflicted to start new positions here. With TLT dropping, horrific seasonality ahead for the miners in June, I cannot justify getting long for a quickie now. There are only a few sectors that interest me, one being solar, and it’s too rich to buy up here. The other, believe it or not, is the gold/silver miners. However, if you saw the seasonality stats for some of these names in the month of June, you’d cringe at the prospects of being long one into the teeth of a beatdown.

There are many speculative stocks trending here and maybe I am being too risk-averse again. But I have my gains and a plan to buy REITs, when no one else wants them. I will be there to buy when the last sell ticket is cast.

Until then, I will wait in the shadows, tending to my FRO, hoping IMMR can continue to offset its wilted ways.

NOTE: My cash position is upwards of 45% now.