Let the Senator Lead the Way

My trusty birthday thief and fellow iBC blogger, Senator Gint, has been right all along with the precious metals, despite the multitude of mini-horrific-financial car wrecks he has endured, which is part and parcel of commodity investing. Do not let the bullshit from the banks or tech sector distract you. Silver and gold is telling you exactly what you need to know: inflation is on the way, in earnest.

Hopefully, in my lifetime, I will be able to eat a $100 tomato and drive throughout NYC rush hour, without having to honk my horn.

Listen to me very quietly and never question me again: the western money changers want to remain in power. To do this, they will debase western currencies. As a result, stocks and commodities will soar. The leaders will be found in the commodity sector. Quit trying to find the next AAPL and position yourself to benefit from the dilution of the money inside of your K-Mart jeans.

Top picks: OXY, WNR, ATPG, CENX, AKS, CLF, CVI

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Yes, we want the market to crumble, like a coffee cake. I’d like to see traders shriek in panic and vomit on each other, amidst clouds of black smoke and shards of metal. With my cash hoarde [sic], I intend to buy the pension liquidations of CNBC personalities, preferably those without hair or brawn. Moreover, it’s very relevant for me to see a cornucopia of hedge fund failures, followed by entire nations defaulting on their obligations. When all of these things are accomplished, “The Fly” shall be fully invested.

Until then, I will, methodically, acquire dips—like deviants purchasing fellatio from hookers in the South of Bronx. My targets are commodity related shares. By the time I am done buying them, I too will don a bow tie and visit CNBC Asia to tell them how stupid they all are for trusting Dr. Bernanke and allowing for bailouts to occur. I will discuss many things, such as the unnecessary bailouts of arson victims and how fires should “burn their way out, naturally,” as they have for thousands if not billions of years. I will protest any and all government projects, such as police departments and prisons. Society should quit relying on governments to bail them out. Put your own prisoners to death, as was done back in the ancient days of Carthage.

[youtube:http://www.youtube.com/watch?v=M4mcQEipU-s&feature=youtu.be 616 500] [youtube:http://www.youtube.com/watch?v=Zr-9BegAyhc&feature=youtu.be 616 500] [youtube:http://www.youtube.com/watch?v=wTTd6KGNnQM&feature=related 616 500] [youtube:http://www.youtube.com/watch?v=juEYHB4ZOgM&feature=related 616 500]

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Despite today’s decline in the general indices, it was a terrific day for commodity related stocks. I believe the stocks are telling you what’s coming.

As a result, I am now heavily positioned in OXY, ATPG, WNR, CENX, AKS and EXK. Additionally, I am long shares of ALJ and CVI.

In short, I put my money where my mouth is and will be eagerly awaiting to see positive results.

As an aside, I booked an egregious personal loss in ZSL, after having an equally egregious paper profit just one week ago. Ten years ago to the date (I remember because tomorrow is my birthday), I booked a tragic loss in my personal account. Let’s just call it my ten year anniversary. And, yes, history does have a weird way of repeating itself.

[youtube:http://www.youtube.com/watch?v=WZ88oTITMoM 616 500]

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I initiated new positions in ATPG and CENX and added to my WNR.

UPDATE: I bought AKS.

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I sold AG near the high of the day and added to my OXY position almost 1 point below the current price. I sold TLT 10 cents cheaper and now find myself scratching my balls, watching the market knife lower. I have NO INTEREST in catching this knife. Remember, the end result will be joyous for inflationistas. But it’s a long trip until that is realized. We could lift off from 10% lower from here. That’s why it’s important for you to time your buys, ever so carefully.

Make no mistake, we are oversold and well deserving of a face ripping rally. But if the perception of European ineptitude permeates and marinates in the small minds of American money managers, you will see the Dow throw up chunks on itself. For this reason, “The Fly” remains at 50% cash, heavily long OXY, WNR, EXK and time.

[youtube:http://www.youtube.com/watch?v=R0q0ZFTuN-c 616 500]

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I sold out of AG because I was sick of the volatility. Plus I own EXK. Owning both of those stocks made up 15% of my assets, which is too risky, considering their asinine beta. What I intend to do is reposition in honorable commodity stocks, like OXY. Look, just because I decided on a thesis doesn’t mean I have to go “all in” right now. I take it easy, plotting my plans while slapping people in the face with hot slices of pizza.

In addition to AG, I sold out of TLT too, in order to get liquid. My cash position is 50% and I am firmly in control of my destiny, effectively reducing risk while confirmed on a course of action.

For now, I need to see the market firm up a bit, prior to adding any more stocks.

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I bought 5,000 OXY, adding to my position.

Disclaimer: If you buy OXY because of this post, all of your comments will be rated “cock-gobbler” from hereon-forth. And, you may lose money.

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I sold out of TLT and AG.

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I saw “Too Big to Fail” on HBO last night, which by the way is the best movie depicting the financial crisis to date. I particularly enjoyed Giamatti playing Bernanke; he was surreal. Anyway, seeing the movie reminded me of how stupid the government is and how intent they were/are in disallowing deflation.

Well here we are, 3 years removed from that event, and we are dealing with a bigger problem: sovereign debt. However, this one is easier to solve because governments do not need to worry about moral hazard, since the issue at hand is survival and not private sector bullshit. In other words, there is no way they will let Greece or Portugal fail. No fucking way. They will inflate persistently until it’s no longer an option. I contend, the only way it all falls apart is if the Chinese bubble bursts. They are perceived to be the white knight in all of this, with all of the growth and cash. When that perception is tainted or destroyed, there will be a run for the exits on an epic scale. Until that happens, western economies will extend the game as long as they can print money, sending commodities higher.

I don’t know when the sovereign debt issues will be resolved. But rest assured, they will paper over it and the market response will be “inflationary.” Do you really think they will let it all collapse, after all they did, because the Greeks can’t balance a budget? Remember, we are not talking about Greece here, but the banks. The European banks own a lot of the debt. If Greece defaults, the banks will need to raise capital or fail. If they fail, so do we. It’s a global economy, for better or for worse.

From a traders standpoint, the goal is to stay in the game and not get blown up waiting for resolution. Starting today, barring material news of disastrous consequences, I will begin a campaign of buying up beaten down basic material stocks. I will buy a basket of names, all with better than average fundies, in an effort to capture the coming inflation trade, which will happen as sure as I am sitting here.

To do this, I will need to make some wholesale changes.

Stay tuned.

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Something to consider.

Also, FAZ is being flagged as OVERBOUGHT. The accuracy stats of the algorithm are the following:

1 FAZ Yes -8.50 80.00 5.00 45.05

That’s 80% over 5 signals for an average loss of 8.5%.

Some OVERSOLD names include:
EEB, PIN, ASI, SINA etc.

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