Joined Jan 1, 1970
1,010 Blog Posts

I Know It Looks Easy

I know I make this shit look like riding a bike, easy as shit for a grown man. But it’s not. It’s hard work and lots of research. The book was up big today, lead by WNR, CENX, FL and GSVC, and topped off with TNA and short VXX. They were like the cherries on top. But now the key question arises: for how long do I want to be long? Well I didn’t sit here inactive as fuck, seeing market weakness and then finally getting my Dick wet for just 1 day. At the same time, I have to recall recently coming to the conclusion that about as many headlines as possible are all going against the stream of the market. So, I sold out of TNA and covered VXX. I don’t want the uber high beta names hanging on my book for too long. This raised my cash to 40%, too, an amount I’m happy with. I see a little more upside, and bonds may be starting to come in. Should the headline risk settle down, I can always hop back in. Otherwise, I’ll be waiting for the prophecy to tell me to sell, and I’ll be out. For now, it’s about the balance between oversold bounces and economic reality, and I’m on a motherfuckin beam. Feel me?

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Fuck these bears right here, right now. Added IWD below 59.50 and FL 20.15

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I Like.

I bought through the morning and even added some CENX in early afternoon, all timestamped inside the 12631 trading room. As a member of 12631 and The PPT, there are several places where my buys are timestamped, all depending upon which page I have up at the time.

Nonetheless, here they are:

I added to WNR, GSVC and CENX

I shorted VXX and I bought TNA, IWD & AEC

I was attacked for buying “into a 3% decline” but am happy to say that as of today, despite the market’s ONLY DOWNWARD ACTION, I am actually up on the account, albeit slightly. However, I am absolutely ready to take advantage of some up action in this market, sitting on 55% cash now and ready to get big should the market follow through to the upside.

Keep an eye and let’s have some fun

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Can The SNB Persevere?

So the SNB decides to peg the Franc to the Euro. Interesting move, in contrast to recent currency intervention attempts a la BOJ spending a specified amount, the SNB is setting a specified target and implying that they’re ready to spend whatever it takes. So the question is, “are they?”

I have to go off on a tangent real quick and give shout outs to two people. One, ChessNWine because his TA predicted this news event. You know you’re the man when your TA predicts news events. Two, Cain Thaler for his write-up a bit ago proposing that the Fed do almost exactly what the SNB is doing. But I digress, so let me backtrack a tad.

While the SNB is attempting to peg the Franc to the Euro, the free markets may raise their middle finger and disrupt the Swiss plans. In Layman’s, the SNB is going to have to spend an unspecified, perhaps unlimited, amount to keep this peg, dependent upon how much the free market really believes the SNB is devoted to the peg. The Franc very recently has seen unprecedented levels of interest in its debt, causing its currency to rise dramatically, hurting exports and deterring growth. That’s obvious, it’s basic economics. So who also benefits from a cheaper Franc? Probably some bullshit, miniature euro countries that use the Franc as a currency in business deals, but who really gives a fuck about that. I’m much more focused on the help this may provide to the Euro. Should the SNB surprise the market in its devotion to the peg, we could see some relief in the Euro zone. Indeed, immediately after the news, the euro markets rallied hard, some going green and the Swiss market shooting +4%. Welcome to the inflation game, Switzerland. However, let me connect this story to one of my shoutout’s, my man Cain Thaler.

Seriously, he is a must read. Just a week or so ago, in an article about what QE3 may look like, he put forth the idea of QE3 being the Fed’s support of the Euro. For reasons discussed within the article and added after its posting, he (and I hahaha) defended the thesis with logic and reason. But really, what is the difference between the SNB and the Fed boosting the Euro? Both are triple AAA countries (LOL @ SP), whose debt is at interest rates lower than ever before and who are inextricably tied to the success of the EU. Further, very recently some rumors of a $420Bn package coming soon have circled the wires. Let me propose a theoretical situation: should Double B ride shotgun with the SNB, the determination of central bankers may overwhelm the free markets and we could see a ton of relief in the Euro zone’s stricken nations. Moreover, the USD would catch another right hook from Boxer Ben and the reflation trade may be back on the table as quickly as it was wiped off and replaced with doomsday scenarios.

The ease with which the plate on the table is replaced shows just how up in the air our current economic landscape is. Failure is just as likely as success, reasonably speaking, and it all depends on how motivated and accepted the central bankers are. What a fucked up world we live in.


Good luck out there

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Entering The Abyss

Shit is blowing up, bitches. You know, to be honest, I always kinda accepted that this would happen eventually. Like I’ve said, I typically side with Austrian economics, rather than Keynesian, and have always scoffed at the idea of throwing good money after bad. Only recently, maybe as of the last 18 months really, did I fully recognize the severity of the situation that the U.S. found itself in just a few years ago. I don’t think most people truly understand the outcome of failure, had nothing been done to remedy the situation. Economic failure would have only beget the series of events that would have unfolded. I don’t want to describe them as everyone has probably read a doomsday scenario or two. However, if you do understand the contrast of the two outcomes, first doing nothing or second doing something, then you realize why the decisions were made: WE HAD TO.

We had to try to prevent the collapse of first world countries, due to financial risktaking going awry.

But now where do we find ourselves? Still in a heap of trouble, thanks to career politicians, corporate interests and the devolution of society that is now witness to the masses not simply unable to understand what’s going on around them, but actually not fucking caring.

Over in Asia we have China eating everyone else’s power pie slices, since they like three things more than anything else: Saving, Working and Educating. (As noted in a previous blog, “The tail that wags the dog that wags the tail”) I’d move to China, seriously, except I can only eat so much boneless bbq spare ribs with pork fried rice lunch specials.

In Europe we have idiocy of a collection of varieties. We have Italian idiocy, Greek idiocy, German idiocy, etc. I guess Greece doesn’t really feel culpable for having a major hand in current events, despite the growth of their debt to >200% GDP. WHAT THE FUCK? Here’s an idea: Those crafty swiss can sell a gagillion francs of debt with their negative yields and then buy Greece. It’s a wonderful idea, really. Then the Swiss can ski and shit in the winter and island hop in the summer.

And here in the U.S. we have Barama cockblocking Bernanke, Repubs cockblocking Dems, Teaparty cockblocking Repubs and them all circle jerking while cockblocking the citizens. It’s now a frontpage C.N.N. storyline because Barama is going to raise $1B for his campaign. WHY DOES HE NEED $1B FOR A FUCKING CAMPAIGN? Because the people are so stupid, so uninvolved, so impressionable, that $1B can literally buy you a seat in the white house. Meanwhile, once this Barama gets in, he immediately pushes through thousands of pages of new legislation and baramacare while also trying to fix the job market. Does this barama not realize that when you contort, bend and literally make a maze of rules and regulations, you might deter companies from hiring? He wanted to leave his mark on the Presidency so bad, that he had to usher in baramacare with such horrible timing so as to literally prevent the country from caring, since the primary concern of citizens now is our highspeed rail pass to fucking failure. Well, he certainly left his mark…FAIL.

Who knows what this market is going to do this week. We could be down 100 S&P as quickly as we can recover it. There is no elevator down and stairs up anymore, since the market likes to sashay between collapse and spaceshuttle launching ascents. I’m >60% cash and I own some gold and silver ETF’s, so I’m going to enjoy watching the funds of Paulson, Tilson and others blow the fuck up. At some point, we’ll be oversold enough and the market will snap back so fast it will break your neck.

That said, I’ve got tons of thoughts that I’d love to put into words this month, on subjects ranging from: Why it’s bad that pro athletes earn what they do, Why professional politicians disgust me and how incentives can go wrong, Why our tax system needs to be scrapped, etc. etc. So be on the lookout, I’d love to create some good discussion among intelligent people. (Thus, no unintelligent people allowed)

Good luck this week.

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