A Fistful of Awesome!
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Yep, I went and did it again today. I didn’t like the pin action in the price of gold, not to mention the dollar, and so hedged most of my major positions, including SLW, ANV, EGO and RGLD, with short calls, just slightly in the money, one month out (Novembers).
I also trimmed my AGQ once again, selling another 400 shares at $104+. I now have only a measly 400 shares left from my original 3,000. We are retardedly over the 200 day moving average in silver, which just refuses to stand down, but AGQ will be a hard break when it does finally succumb to gravity, I’d contend.
The good I see ahead is in the precious metals, big surprise, no? That’s why I’m only shorting calls, rather than selling big chunks, though I did sell 30% of EXK yesterday, instead of selling the calls. At prices below $5, however, and really even below $10, I see there being little difference in the price of a call, and the price of a stock, so I just sell the underlying to a point where I’m comfortable holding through the storm, and then I just hang on.
The bad I saw today, was in the bank stocks. I thought at first that this mortgage gig was a smokescreen, readied by The Powers That Are to scare some valuations down for coming bank M&A’s. That thesis may still be correuct, but I was given pause by the action of the bank index ($BKX) today. Observe:
After all this hooplah since early September, you’d think the financials would have something better to show us than the above, no? And yet, it’s looking bad for now. I shall revisit my “possible takeover” thesis later in the year, as I still believe there’s a strong percentage still in betting on a flurry of acquisitions coming off at the end of this year.
In the meantime, I dumped the last of my BBT, FITB and even JPM. I may buy back one of those after this storm has passed here, but for now, cash is better than banks.
The ugly is none other than the mighty U.S. dollar, which seemed to get it’s bounce today, off the $76.40 low area and is now almost 30 cent higher at $76.70.
This bounce should give you an opportunity to consolidate some positions, and perhaps enter others. I have my eye on more GSS, which is one of the few gold and silver plays that is not yet overbought. But be ready to pounce with all alacrity on the whole universe, as this pullback may be short lived.
Or, not lived at all.
My best to you.
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How dare you not call the market not perfectly!
I am taking up my cat o’ nine for self flagellation purposes as we speak.
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UGH, how I wish I held on to my EXK and BAA. LOL, I guess I should raise my “think of them as options” price to $5 or $10, at least for the PM’s.
What I do is set a “core” amount that I will keep come hell or high water (until the final parabolic move, at least), and then an “excess” group which I will trade in and out of.
In the case of EXK, I had about 36k shares, and I just dumped 10k of that. I might dump another 8k or so, but I’ll probably keep 50% of the original outstanding.
Some I almost never sell, save for wee amounts, like RGLD.
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Jake, got any guesses why EGO has been underperforming? Acquisition related, 2ndary in the offing?
Could be any of those… could just be cyclical. It got hot when the Chinese made that investment. Could be they’re laying it off now.
I wouldn’t be overly concerned.
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And the bitch-whore goes back under $50…..
She’s teasing you…testing your mettle.
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Hyper-inflation is here. This so called bubble is just beginning and will not pop until the dollar is toilet paper. Commodities dont just take-off like this for no reason. There is a major disturbance in the force, and it will be here for quite a while. We have 2 more years of inflation coming and then its all over in my humble opinion.
Good thing the Seniors got bubkis this year for a COLA adjustment no?
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Jack, what do you think of buying $AUMN? It went up so much during last three month. Thanks.
sorry my typo – i meant Jake!
The old Apex silver? Looks a little dicey.
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On a scale of 1-10, how outraged are you over le Sarkozy’s decision to raise France’s retirement age to 62?
Off with his head!
http://aomid.com/french-protest-in-paris-anger-over-retirement-age/223793/
I am thinking of storming the barricades in sympathy.
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Hey Jake,
Haven’t been here in awhile (except for a few wine induced visits that could or could not need an apology, dunno. LOL), but it is good to stop in here and read again. Whenever I become uncertain I come and see what you are doing and it is always a good move. Thank you for that. And good to see all the familiar posters and some new ones, too.
And with that out of the way, what are your thoughts on TBT? I have started a position a few weeks ago that I am up nicely in right now, but really not sure where to go from here. Have you any thoughts on it?
I have not been selling anything this week ( I did take profits in SLW as I was up over 100%) and a few others that you don’t really cover, but I have been buying TSE:EDV (Endeavor Financial, formarly Endeavor Mining (invests in mining companies), and Alexco Resource, AXU).
Really curious about your thoughts on TBT at the moment, though. Thanks for any input you have.
Hey Yogi!
Oh jeese, I just noticed FIG here on your blog, and I wanted to tell you FIG, I still have my ES. Yes, and I am still a believer (just a believer that is negative by egregious amounts in that particular position LOL).
If I knew of any uranium minors that stood head and tail above the others, I would be a believer in them, as well. I think uranium is the resource stocks to get into after the PM’s. But, what do I know.
And lumber, and food, and water, as well. 🙂
Maybe even a little geothermal (which I am already in albeit a little too early probably).
and OMG, your music choice is AWESOME!
In appreciation to you and yours, for your insight (well, I ain’t exactly playing it, but if I could I would be) ~
http://www.youtube.com/watch?v=Jw5Knvdtutk&a=GxdCwVVULXe-Ln4mBoXvokN6VzEHKofO&list=ML&playnext=11
Oh good grief, I killed the damn thread. Bother.
The last bull market in gold lasted 9 years (1971-1980). Last week, the least investment savvy individual I know put 20% into a gold mining mutual fund, because he thinks that foreclosures are going to drive up the gold price. Famous gold advocates (Mr. T) are appearing on Bloomberg.
And your point is?
There is no massive public participation in gold. Very few individuals own it as an investment, your un-savvy friend to the contrary. It represents a tiny percentage of all public investment funds — something like .8% — compared to %20 in 1980.
At some point gold will go the way of all bubbles. It will go parabolic, double in price within a few months, and burst, then go into a bear market for 20 years.
We’re not there. We may be in as little as a few months or as much as a few years, but not yet.
(Oh, and I’ve been hearing about the fabled “Mr. T indicator” for years now. It’s neither accurate nor particularly amusing.)
Was the public rushing to buy gold in 1980? I don’t think they were; as I recall, my father was selling some gold belt buckles to take advantage of what he felt were high prices.
The point, if you must have one, is to consider that the current bull may be over. Doesn’t matter if it is only over for a year or a decade. As for Mr. T, I got a laugh out of the indicator based upon his career. I suppose if I were gold buggier, then that would have been an impossibility.