MOVED TO CASH

I was fortunate to have some winners this morning, all 10% positions with exception to SQQQ at 25%. My allocations have been bigger and bolder, mainly due to the success I’ve had this year with some leeway to lose. I sold everything at the open, higher by 178bps for the session, and have no temptation to chase hot oils or buy cold tech dips.

This being the last trading day of May, I’d like to go out without a drawdown — higher by more than 15% for the month.

Good morning lads!

Futures are soft and commodities strong. We are coming off from a very strong week whereby the NASDAQ leapt higher by 7%, featuring all sorts of wonderful wonders take place. The backdrop of the rally of course was grim, as the Dow had previously plunged 8 weeks in a row — the longest losing streak in the Dow since 1923. But don’t let that get you down lads; China is reopening and Italy just removed their COVID restrictions.

In other others, the Fed begins to sell down their balance sheet tomorrow.

How big is said sheet? About $9 trillion, all monopoly money.

For Treasury securities, the cap will initially be set at $30 billion per month and after three months will increase to $60 billion per month. The decline in holdings of Treasury securities under this monthly cap will include Treasury coupon securities and, to the extent that coupon maturities are less than the monthly cap, Treasury bills.
For agency debt and agency mortgage-backed securities, the cap will initially be set at $17.5 billion per month and after three months will increase to $35 billion per month.

Over time, the Committee intends to maintain securities holdings in amounts needed to implement monetary policy efficiently and effectively in its ample reserves regime.

To ensure a smooth transition, the Committee intends to slow and then stop the decline in the size of the balance sheet when reserve balances are somewhat above the level it judges to be consistent with ample reserves.
Once balance sheet runoff has ceased, reserve balances will likely continue to decline for a time, reflecting growth in other Federal Reserve liabilities, until the Committee judges that reserve balances are at an ample level.
Thereafter, the Committee will manage securities holdings as needed to maintain ample reserves over time.

Based upon the Fed’s plans, the balance sheet will take a lifetime to drawdown, aka never going to happen.

US 10yr is +10bps, which is probably some front running ahead of tomorrow’s excursion into the unknown. How long can the Fed run down it’s balance sheet without the market bitching about it? We’re about to find out.

The EU announced a ban of Russian oil consisting of 2/3rds of imports with a goal of 90% by the end of 2022. Couple that with the gas issues they’re having, resistant of paying up in Rubles, the entire continent of Europe places themselves in the unenviable position of having to freeze the coming winter, or at a minimum endure the pangs of shortages and a sharp reduction of economic activity. This is scorched earth now. The west is afflicting its citizenry with the harshest of all penalties in order to attempt to win in the Ukraine, a war which appears to be almost conclusively one sided in favor of Russia.

Brent crude is bidding near $122 now and futures are soft.

On the issue of Ukraine, EU’s Borrell commented on how Europe might do in a war against Russia.

EU BORRELL: “Look, the European armies couldn’t maintain a war like the one in Ukraine for more than two weeks. They’ll run out of ammunition.”

In conclusion: The United States has deemed Ukraine of utmost national importance and has subsequently ordered Europe to go along for the ride, in an attempt to destroy the Russian state. To do this, instead of outright war with Russia, we intend to send wonder weapons into Ukraine so that the Ukrainian men could fight and die for our position there. We have taken over full control of Ukraine’s finances and military needs and will not negotiate with Russia for a diplomatic end.

The financial ramifications have been minimal for Russia, but severe for the west as rampant inflation and supply chain shortages wreak havoc.

About half of the country is in favor of war with Russia for Ukraine — because they have been told fighting for democracy is oh so important. A similar tale was told before the Korean, Vietnam, Iraq, and Afghanistan wars.

UPDATE: Last night I had a bottle of wine and perhaps my vision was blurred this morning when I read about Biden’s plans for long range missiles. He announced the US would NOT provide Ukraine with weapons that could strike DEEP into Russia. Pardon my gambit at fake news.

This of course didn’t stop the form Ambassador to Russia from war mongering.

Ukraine needs Multiple Launch Rocket System (MLRS) & High Mobility Artillery Rocket System (HIMARS) to stop the Russian army's advance in Ukraine. This decision is a mistake: Biden Rules Out Sending Ukraine Long-Range Rocket Systems That Can Reach Russia https://t.co/zGluGll33p

— Michael McFaul (@McFaul) May 30, 2022

There’s a working theory out there that the government is all knowing omnipresent, with well thought out diabolical schemes to bring all sorts of pain and suffering to the world, rooted in satanism and sacrifice — all for the end goal of world domination. I have long dismissed this absurd theory based on the empirical evidence that the people governing us are incompetent idiots, who are now in the last throes of squandering what they’ve been given — compromised by drugs, sex, and power. These creatures are nothing more than insects — invading homes and families like the pests they are. We are seeing their grande incompetence on the world stage now — via this weak attempt at stopping Russia from winning in Ukraine.

The update goes as follows:

Russia originally went for a wild eyed gambit in an attempt to end the war early and misjudged the fighting ability and will to fight by the Ukrainian army. This was viewed in mocking tones by “the west”, who felt embolden by this and as a result directly intervened in the war via sanctions on Russia and the kitchen sink in weapons supplies to Ukraine. Since then the Russian army, under new command, regrouped and started a more traditional method to wearing down and destroying the Ukrainian army, via artillery, missiles strikes, and air assets. Since then the Russian army has not been mocked as much on Twitter, as nearly all news reports have pointed to their success in the Donbas.

The sanctions the west inflicted on Russia have failed, as evidenced by Russia’s currency, stock market, and trade surplus. Putin just increased pensions by 10%. A failing economy doesn’t give his entire country a pay raise.

So now in the face of all these failures, the west, led by Biden, is doubling down. Today Biden boasted about sending missile systems to Ukraine that can strike deep into Russian territory.

This was the response from Russia.

MEDVEDEV: Otherwise, during the attack on our cities, the Russian Armed Forces would fulfill their threat and strike at the centers for making such criminal decisions.” Some of them are not in Kiev at all. There is no need to explain what would happen after that.”

Biden: “We’re not gonna send to Ukraine rocket systems that can strike into Russia.”

Russia’s Medvedev responds: “Rational decision.”

— The_Real_Fly (@The_Real_Fly) May 30, 2022

This is where we are now — countries like Germany sending 15 tanks to Ukraine, Biden wanting to provoke Russia into attacking a NATO country so he could play FDR, and all of it reeks of wanton incompetence.

Let it come as no surprise to any of you out there that the best of stocks are wholly in the commodities sector of the market — the place where Vladimir Putin twists his Russian knife most severely. Using the Stocklabs ranking system, I intend to provide you all with the top rated stocks over the past month with volume over 300,000 per day and then the one’s little known to the outside world, the orphan stocks who trade less than 300,000 per day. No need to thank me for this gift, as I am a patriot.

As you can see it’s littered with downstream (refiners) and natural gas names, mostly due to the fact that we are being RAPED at both the pump and inside or our water heaters. I apologize for using such a violent word to describe my stock screener.

And here are the orphan stocks, the one’s no one wants to adopt because of fears they’ll steal all of the china at night.

My generosity is without boundaries.

On a non-stock related note, I watched the new season of Stranger Things with my family with weekend and was not surprised to learn how stupid the writers have become since taking their COVID-19 vaccination. The plot was utterly retarded and I wanted to throw my television out of the window, but refrained because I still need to pretend I am a normal person in front of my children. This is just another example of how movies and shows have denigrated since the COVID-19 vaccinations, mostly due to blood clots inside of their fucking brains.

I did not see the new Top Gun yet, but will do so soon. I fully expect to see Maverick shot down and KILLED by a transgender Canadian pilot with rainbow stickers festooned all over his/her F-35.

Just a brief set of thoughts before I go outside.

We had a very good week for stocks and in between all of the celebration were several earnings shortfalls that resulted in heinous drawdowns, most specifically in consumer related and technology names.

At the same time, the general market rose, but with it commodity stocks. As a point in fact, they rose almost as much as the deeply oversold tech stocks, sans all of the associated risks involved with buying growth companies into a weakening economy.

At this point, the only thing that could upset the apple cart is piece in the Ukraine, which isn’t going to happen. As a matter of fact, things are about to escalate in a terrible way soon.

Let me just say, you all deserve harrowing losses for what you did this week. The nerve of you bidding this market up like this made me sick to my stomach.

HOW DID I WADE THROUGH IT?

With grace — because I am a professional.

THESE ARE MY FUCKING RETURNS.

That’s right, the automated Quant was up 13 fucking percent for the week and my trading gains are +42%. I closed the session 11% cash, and 25% hedged into what I hope will be CATACLYSM on Tuesday. None of the bad news is factored in and I know this sounds or reads rather like Chicken Little nonsense — but the skies are truly blackening and the future is going to be terrible.

ON A BRIGHTER NOTE:

I will of course treat myself to watch the new Top Gun movie, but fully expect to see Maverick team up with a morbidly obese tranny — who splatters jelly donuts all over the COCKpit, leading to a Russian S-400 battery to shoot down and kill Maverick, which would be good — seeing that he is a straight white male, most likely a Trumper. Not sure what to expect from such a movie, but as sure as I am sitting here — IT WILL BE RETARD TIER just like the new Batman — where that loser prances around in nightclubs for 3 hrs doing cuckhold shit. The new Top Gun will probably feature Maverick spending more time in CRT classes than training, leading to him and his entire team getting SHOT THE FUCK DOWN on their first day in combat, or perhaps their entire aircraft carrier will be sunk whilst raising the rainbow flag for pride month.

My expectations are decidedly grim.

SIRS —

I AM FLAT FOR THE SESSION, a great accomplishment considering I am bedraggled by SQQQ as a 25% holding of mine. I should’ve sold when we had that one red candle this morning but I didn’t so now I sit and wait for the late day sellooooors to appear, those who are scared to hold over the long cold and dark weekend.

Let me remind you, MONKEYPOX is on the loose, with Spain finding another 14 ill from the disgusting disease.

LOOK AT THOSE FUCKING POX STOCKS GO.

Aside from that, I am 25% cash, 100% balls and cock just trying to chisel out a path towards green today. Although markets look good right now and the bears are caught off guard with this up week, I’d like to remind all of those reading that Russia is winning the war in Ukraine, the US is in recession, the housing market is going to blow the fuck up soon, inflation is a permanent fixture now that we sanctioned ourselves to death, America is a mentally deranged nation of drug addicts and users, and we have OFF ON MONDAY — which is probably the scariest thing of all.

Try not to get monkeypox over the weekend lads.

The PCE came in hot as fuck at 6.3%, but as expected so futures took off. The NASDAQ is looking to gain around 140 at the open, which would mean the overall market is on pace for its first weekly gain since March.

On the issue of inflation, Jim Biden is set to forgive $10,000 in student loans, so don’t give up on the $100 tomato idea just yet.

Imagine the hubris should we extend said gains into yet another week? It’s not our job to fight trends, but to obey them and on occasion predict the future. If inflation data didn’t scare the market down and all of the bad earnings didn’t scare the market down, it’s possible the bad news is baked in and markets want higher.

That being said, be on the lookout for new shoes to drop, new bad news to worry about. I have nothing to offer you now, but the way bear markets work — there’s always something to get in the way of a nice rally.

NOTE: I’m not a believoor and do not ascribe to the notion we have bottomed.

Fridays have been woefully dreadful for the market, especially ahead of a long weekend with Monday off.

NASDAQ IS UP JUST TWO OF THE PAST 10 FRIDAYS *** $QQQ pic.twitter.com/OAcuRHAgD0

— Stocklabs (@stocklabsapp) May 26, 2022

I closed +1.74% and at the close, since I didn’t want to sell any of my 10% positions, I threw down a 25% position in SQQQ — which should cover me should markets decide to cascade lower tonight and into tomorrow.

I have no desire to be greedy and I am grateful for being able to navigate the market with grace and poise, now +41% for the year, +12.2% for May. I was always going to make money in a bear tape and there was never a matter of if but if when, for those who’ve been following me from the beginning. To all of those who quit Stocklabs in favor of cartoons, find solace in knowing your subpar thinking has landed you in an inexorable subpar existence of having gone down the wayward path of Morton’s Fork — because you never had a choice in the matter — biologically predispositioned to make poor choices — sad and fat.