Back from Bear Hunt

Wow, that bear hunt did not go well. This morning I thought I’d be eating bear face for lunch. Instead, here I am eating another slice of humble pie. I’m barely up and this reflex rally is a fucking joke. There is NOTHING redeeming about this tape, whatsoever.

Oil is getting poleaxed and tech is in the dumps. I feel like I am being boiled slow. My losses are not horrific, yet they are piling up. I don’t want to sell everything, due to fears of missing a sharp reflex rally. I don’t want to short anything, for the same reasons. In other words, I am being boiled slow. I can see the market dumping out 5% in a day, finally forcing me to sell. On the other hand, I can also see a monster 5% rally, healing most of my wounds.

The opportunities are always the greatest when the risk is highest.

Bottom line: I am betting against a black swan type of event, since that is the higher probability trade. It is a shitty trade, but the only one available to me at the moment.

The Bose radio system is blasting this at Casa del Fly, heavy bass, on auto loop.

Some of you might have noticed the last blog on this here website was, umm, a bit on the cowardice side. It had tinges of panic and bouts of bitchery mixed in. The one prior was regarding some newly minted HEALTH NUT Fly, with regards to lifestyle. Well, there is a certain “root cause” that spun off a series of unfortunate posts here today, which can and will be easily explained in the paragraphs to follow.

You see, typically, I start my day with brushing my teeth, taking a shower, eating oats and doing pushups—in that order— without deviation. Upon entering my closet, I am instantly robed and caped, so that I might start my day. You see, this morning, I was not caped, nor robed. There was a malfunction with the mechanisms inside of my walk in closet, which caused the instant robing and caping device to malfunction. Not knowing what the consequences of such a disaster might portend, ignorantly, I said “fuck it” and went about my day as if nothing had happened.

As you know, the results were barbaric.

“The Fly” displayed cowardice on a monumental scale, while declaring new diets and metrosexual lifestlye changes that must have made many of you cringe. For that, I am deeply sorrow (Chinese form of saying sorry) and beg for your forgiveness.

However, let the record be known, YOU were not right and I was not wrong. Such talk is against nature; you do understand? Should you go about believing that you are in fact better than “The Fly”, the entire universe might get sucked into a fucking HUGH HENDRY vortex, killing everyone but, ummm, Hugh Hendry. I hope you appreciate how I am simply looking out for your best interests.

In return for my unending generosity (saving your life and the planets existence and all), I am asking for each of you to repay me in a very proper, yet Nigerian, manner. I would like you to email this article to someone who doesn’t read the site, in order to spread the word that today’s events was simply a misunderstanding. You and I shall call it “The Mother of all anomalies.”

I must be going now, as I have a HEAVILY SALTED STEAK (wink, wink) and a flask of WHISKEY waiting for me at the dinner table. After dinner, “The Fly” will drink some port, then move onto firing up the olde [sic] Keurig, where he will consume a minimum of 12 cups of coffee, whilst watching the Asian markets shatter into pieces.

Pardon my absence. I am predisposed and typing this from my iPhone.

Who am I kidding with blind optimism? You were right. I was wrong. This shit really is falling apart right now. Today’s action is nothing less than horrific, with another Chinese scandal to boot with HRBN.

Confidence is nothing and people are selling everything.

Opt out.

This is breaking news of the obscene variety: for no reason at all, “The Fly” has given up drinking coffee, alcohol and high fat foods, in exchange for bitchass vitamins and water. I’ve been conducting this experiment over the past week and feel great. Furthermore, I’ve ramped up my exercise routine to 2 times per day and cut out the creatine.

Since I am a fanatic with just about anything that I do, there is no concern that I will fall off of this regiment. The wine will age and get better with time. And, frankly, coffee is overrated. Fuck you, I said it. The Keurig machine has been drained, cleaned and turned the fuck off.

Started a small position in BZH, buying 10,000, $3.41ish

Mrs. Fly likes to call things “super.” Whether it’s “super bad” or “super cool”, lo and behold, if given the opportunity to say the word “super”, she is there. If I might interject your daily bowl of oatmeal, I feel this tape is “super bullish” this morning. Considering the fact we should be down 1%+, this is super cool.

Hell, with CDS markets blowing out and the U.S. without leadership, the market is free to fall as far as it likes. But it chose to go up this morning. For that, I am super grateful.

Naturally, for a bounce, commodities is where it’s at. Names like OXY, COP, JOYG and MTW look good. The refiners are lagging. However, they tend to come out of left field with gains. If you really want to throw the dice, look at the finnies. The easiest way to play them is via FAS, RKH or XLF.

I’m not against raising cash here. However, I am very much opposed to selling short into the weekend. The euro people have to bail out Greece. If you want to short, you might as well wait until after that deal is announced and fade it. There will be a short squeeze, as many are leaning that way now.

These European leaders make Obama look competent. I cannot believe they are letting Greece snowball. Not only are Greek CDS blown out to idiotic proportions. But now we have Portuguese, Irish and Spanish CDS blowing out too. Don’t look now, but Italian CDS are about to blow past 200 bps.

Look, it’s very simple. There is no way to solve this crisis. The only choice for the ECB is to kick the can down the road and pray for a miracle. I realize kicking the can is something most people will poke fun at. But, this is real life and people always choose the path of least pain, like it or not. They are meeting this weekend and they better have a deal by Sunday, else this will be Lehman part 2, only worse.

These countries will fail, in turn fucking the banks to a degree that you bearshitters could only dream of doing. They all have sovereign exposure, in the 100’s of billions. A sovereign crisis will absolutely crush the stock market and ruin confidence, on a global scale. It might even spill over into South America, where debt loads are still very high.

So the choice is simple: paper over now and live to fight another day. Or, you will die.

I’d be lying if I said I wasn’t uneasy about this tape. Over the years, I’ve managed to cut back on my trading activity, opting for swing trades over day. There was a time when I’d execute 100+ trades in a day. However, that lifestyle wasn’t for me. Typically I execute 500 trades per month, most of which you see here. As of late, I’ve been almost stationary with my positions, selling some, buying others. But, for the most part, I’ve held my core together, since I believe they will melt higher, better than most stocks, should we go up.

The problem with sticking with positions is you start to build an emotional attachment to them, via rooting for them on a daily basis. Watching WNR or CLF down big is like throwing rocks at my head. I feel like I am missing out big time by just watching fuckers mint coin on the short side, while I wait for a turn. In the back of my mind, I keep thinking “what if we are on the other side of the mountain?”

What if?

Today’s nasty tape has me thinking maybe, just maybe, the Euro-fuckers will drop the ball. Essentially, I am relying on perverts at the IMF to bail them (the butt-fuckers) out, and by extension, me! This cannot be a cogent asset management strategy, relying on rapists and lazy olive eating stick throwers to pave my driveway in gold.

So, I have a few choices.

1. Sit here like a paradiddle and wait for something fabulous(no homo) to happen.
2. Start day trading like an ADD addled moron.
3. Go to cash. Reset.

While it’s true, I don’t mind living the paradiddle lifestyle, hanging around the yard, eating tomatoes off the vine. It’s a hedonistic way of living, whereby all I do is throw millions at good stocks and wait for “special shit” to happen. But, truth be told, I need to be a little more hands on.

The wait and see approach has worked, continuously, over the past three years. So, this paradiddle strategy is not exactly a negligent one.

Or, am I making a mountain out of a molehill? Case in point, we are flat for 2011. In 2010, the market was down 7.95% in May and -5.2% in June. Hell, everyone was declaring the market dead and “let the double dip begin.” But it didn’t quite happen, did it? In July of 2010, the S&P surged by 6.8%, retraced 4.5% in August, then exploded to the upside by 8.9% in September. And the rest was history.

In 2011, we lost 1.1% in May, following 4 consecutive months of gains. And, we are down 4.1% in June, so far. Frankly, looking at just the numbers, sans news, this is really nothing to shit the shower over. Should the next set of employment numbers kick ass, this market will rocketship higher in July, just like last year.

In the interim, Wall Street is about survival. Blind faith will not pay for the mindless shit Mrs. Fly needs to buy on a daily basis (no fear, since she NEVER reads the blog). Like I said earlier today, I am keeping everything, sans WNR, on a tight leash, in an effort to slow things down a bit. Swings of +4% or -2.5% is fucking retarded, especially when dealing with many millions of dollars.

Okay, I’ve decided to give this market one last chance to crush your bearshitting skulls all over the Wall Street bull. The Greek parliament is getting together tomorrow to form a newly minted/retarded government. Perhaps we might get some clarity on when they will accept handouts.

Remember, the market isn’t trading lower on fundies. The market is trading lower because the bailouts are taking too fucking long to materialize. We know they are coming, but when? In the interim, people are selling, eating clams, having the time of their lives. Look at Alphadawg, he is 100% cash on a beach somewhere, up 20% for the year. On the other hand, I am here, down 7%, waiting to exact revenge on the bastards who stole my money.

All of the things I planned for are nil and void, unless we get our swagger back. Sure, the refiners should kick severe ass this earning season, but off of what price points? I’ve been extremely patient with this tape because I am conditioned to be rewarded for my patience. In the big scheme of things, the market is flat for the year. We can either sink lower for the rest of the summer, then dump out in September. Or, we can surge from here.

Waiting 1-2 more days isn’t going to break my year. But it might make it.