DOW Off 300

514 views

Look we can sit here and try and play “Guess What People Are Thinking”, but I sort of feel that the game is a waste of time at this point. The room for psychoanalysis is well past. We’re selling off hard again and that’s all there is to it.

I had hoped – hoped – that we were near some sort of bottom. But obviously nobody took the time to guess the true impact of watching the EURUSD collapse by 20%. So now we’re going to get more face punching. It’s really that simple.

The strong dollar is going to be a huge boon for savers. Unfortunately, there aren’t any of those in America.

Bought CCJ and OMAB

765 views

I am deploying some cash here, by buying back my old position of CCJ for $14.14, and starting a new position in OMAB for $37.78.

CCJ is a well documented position by me, and I believe the thesis holds. Uranium prices are continuing to recover. CCJ has some issues with the Canadian government they’re working through, and have been smacked around by the selloff. I think uranium will have its day soon enough. Cheap, clean power is a global commitment – to that end, the climate change crowd will at least serve some purpose for me.

OMAB is a publicly traded Mexican airport which has been growing at a double digit pace. As the American consumer continues to reap the windfall of cheap gasoline, I expect vacations will pick up. OMAB is the terminal for Cancun, as well as other locations across that region. They also are a major owner of a Puerto Rico airport.

Besides continually growing traffic, they also should get a benefit from cheap fuel prices.

OMAB was detailed in the Income Investment Report, if you want more information.

Cash stands at 60%.

Should I Write About My Cash?

416 views

Maybe I’ll start writing weekly columns about the up and coming developments in the cash sector. I could, for instance, average together all the serial numbers on my cash, and then run countless back testing to see if that number modulo 7 correlates to the S&P 500 (pitch destroyer: it doesn’t, but I’ll have a super catchy title anyway).

Perhaps I will start a new publication to go along with my columns, and call it Cash Weekly. We could discuss the new emerging colors of cash or just pay cartoonists to draw amusing characters over the top of our legal tender’s portraits.

I could always do an in depth review of up and coming US destroyers, and how they pertain to stuffing our cash down the throats of the third world? Or why I’d rather own dollars than euros or rubles? I could dedicate an entire column to other uses for cash, such as mattress stuffing or alternative clothing fabric.

Sorry for the lull; you see, I’m sitting on quite a lot of the stuff at the moment and it is really boring, even though it’s also the right move here.

The Big Question Then: How To Play EU QE?

1,260 views

The Swiss bank just announced that the ceiling they have been maintaining against the euro is to be dropped. That would make sense, since the euro is now trading below 1.17, down from almost 1.40 just earlier. In terms of the exchange rate, that had to be getting very expensive.

But the timing here should be viewed as a sign that the ECB is really about to start QE. This should be the stance because if they don’t, the impact would be minimal, but if they do you can’t be on the wrong side of the trade.

In terms of what this QE will look like…well, that is the question. What is the ECB going to buy? Not public debt, surely. How much more financing can these governments stomach with yields already negative in many countries. Even the worst countries, like Greece, are borrowing at rates that an average citizen would envy.

My guess here is two fold: (1) they buy up private financial assets similar to the mortgage program the Fed had in place, but that it will center on short term bonds, while also working with banks to create a long term financing window (EU companies and banks in particular have notoriously short term financing arrangements) and (2) they take the opportunity to absorb whatever mechanisms exactly they have been using, before now, to hide the massive debt loads that should have been coming due over the past three years.

If you forgot, Europe ended up pulling some master BS, using a combination of trade accounts to gobble up the garbage so that the markets wouldn’t have to see it default. I’m hazy on the exact specifics, but I would gamble that those imbalanced accounts are still outstanding; and my guess is they’re about to get totally monetized.

So the big question now is, where do you park money? I think that it would be very stupid to try and be short right now with central banks making big noise and seemingly readying the cannons.

If this is like past central bank action, then any longs will do – equity, commodities, debt, whatever you like. Oil could get a huge boost since it’s been so ravaged. ECB action will give the Fed room to play, especially if deflation keeps up. Yellen is no Bernanke…yet, but she also hasn’t been tried either. If the Fed coordinates, all boats get lifted.

But the safest low key play is probably just to hug U.S. dollars until things are a little more clear.

I am ~78% cash, with positions in CCJ, BAS and VOC, down roughly 3% in the first two weeks of the year.

BAS Keeps The Lights On

931 views

Take this with a big grain of salt, as there is most definitely a tradeoff occurring here, but BAS just reported this morning that their rig count numbers were…unchanged. There was a drop in rig utilization but all other service numbers were higher than in November.

Now, BAS is about to get whacked hard on margins, as they had to offer steep discounts to customers to keep the lights on. Of course, trading at $6.00, it’s also hard to argue that apple’s not baked in the pie.

BAS is cutting deep and hard here. Their goal is to get expenses below $100 million, which basically gives them a few years of clean life. As long as they can break even (or even just restrict the pain to small losses), they’ll be staying in business.

I really do like this company quite a lot. I bought back much of my position in December, after going 100% cash and mentally picking myself up. So we’re having a little intermission? It’ll be alright.

BAS’ competition is dead. I don’t believe they’re in the same league and we’re about to watch the tide go out for many of them. What’s left will be a stronger industry and for the moment, I’m betting BAS will be a part of that.

BAS also announced they were buying back some stock down here. I’d say terrific but I think that’s mostly symbolic. BAS will need to conserve much cash to survive this.

Alright Time To Turn Around

1,017 views

I am going to lay 2014 bare, fairly and without playing pretty. 2014 was an enormous lost opportunity and, indeed, and calamity of masterful proportions. I do this to put it behind me, log it, and prepare to rise above it.

2014, I ended down 33%.

2014 started out as one for the history books. After pacing 28% in 2013, my book exploded to the upside (and by no means was that an exaggeration, if you were following my positions). I had such a hot hand, with names like BAS and HCLP doubling in a matter of months.

I sat out the tech sector carnage in the spring, unaffected by it. I made money even as others languished.

And what may come as a surprise, I actually called the selloff in both oil and the underlying stocks. In August, penning a self-reflecting piece on how disconnected I was from the real world, up 25% for the year while others were holding on for dear life, I deduced that I should sell out of much of my holdings, if only to reorganize and one up fate.

Then, what may be equally surprising – no, the next sentence is not “why didn’t I listen to myself!?” or equally stupid nonsense – I did sell out of half of my oil and energy positions.

That’s what makes this story so strange. I liquidated BAS from a 25% holding down to 10%. I dropped HCLP from almost 30% to 15%. I trimmed everything. I had 50% cash riding into this bloodbath.

And it still didn’t help.

Yes, I was buying the drop at intervals, but that only accounts for a fraction of the total damage. Maybe somewhere between 5-10%. The other 20-25% mutilation was from 10-15% positions dropping 50%-90% in the span of 90 days or less…

To quote the late J. Ogden Armour, whom I ominously wrote about just before it all happened, “I lost money so fast, I didn’t think it was possible.”

That is it; it’s all on the table. 2014, the year that should have been. Where I let a 25% gain turn into a 33% loss, and more or less had my balls cut off in public.

Good riddance 2014! I hope Venezuela at least collapses totally, as some sort of fucked up consolation prize.

DOW Off 300

514 views

Look we can sit here and try and play “Guess What People Are Thinking”, but I sort of feel that the game is a waste of time at this point. The room for psychoanalysis is well past. We’re selling off hard again and that’s all there is to it.

I had hoped – hoped – that we were near some sort of bottom. But obviously nobody took the time to guess the true impact of watching the EURUSD collapse by 20%. So now we’re going to get more face punching. It’s really that simple.

The strong dollar is going to be a huge boon for savers. Unfortunately, there aren’t any of those in America.

Bought CCJ and OMAB

765 views

I am deploying some cash here, by buying back my old position of CCJ for $14.14, and starting a new position in OMAB for $37.78.

CCJ is a well documented position by me, and I believe the thesis holds. Uranium prices are continuing to recover. CCJ has some issues with the Canadian government they’re working through, and have been smacked around by the selloff. I think uranium will have its day soon enough. Cheap, clean power is a global commitment – to that end, the climate change crowd will at least serve some purpose for me.

OMAB is a publicly traded Mexican airport which has been growing at a double digit pace. As the American consumer continues to reap the windfall of cheap gasoline, I expect vacations will pick up. OMAB is the terminal for Cancun, as well as other locations across that region. They also are a major owner of a Puerto Rico airport.

Besides continually growing traffic, they also should get a benefit from cheap fuel prices.

OMAB was detailed in the Income Investment Report, if you want more information.

Cash stands at 60%.

Should I Write About My Cash?

416 views

Maybe I’ll start writing weekly columns about the up and coming developments in the cash sector. I could, for instance, average together all the serial numbers on my cash, and then run countless back testing to see if that number modulo 7 correlates to the S&P 500 (pitch destroyer: it doesn’t, but I’ll have a super catchy title anyway).

Perhaps I will start a new publication to go along with my columns, and call it Cash Weekly. We could discuss the new emerging colors of cash or just pay cartoonists to draw amusing characters over the top of our legal tender’s portraits.

I could always do an in depth review of up and coming US destroyers, and how they pertain to stuffing our cash down the throats of the third world? Or why I’d rather own dollars than euros or rubles? I could dedicate an entire column to other uses for cash, such as mattress stuffing or alternative clothing fabric.

Sorry for the lull; you see, I’m sitting on quite a lot of the stuff at the moment and it is really boring, even though it’s also the right move here.

The Big Question Then: How To Play EU QE?

1,260 views

The Swiss bank just announced that the ceiling they have been maintaining against the euro is to be dropped. That would make sense, since the euro is now trading below 1.17, down from almost 1.40 just earlier. In terms of the exchange rate, that had to be getting very expensive.

But the timing here should be viewed as a sign that the ECB is really about to start QE. This should be the stance because if they don’t, the impact would be minimal, but if they do you can’t be on the wrong side of the trade.

In terms of what this QE will look like…well, that is the question. What is the ECB going to buy? Not public debt, surely. How much more financing can these governments stomach with yields already negative in many countries. Even the worst countries, like Greece, are borrowing at rates that an average citizen would envy.

My guess here is two fold: (1) they buy up private financial assets similar to the mortgage program the Fed had in place, but that it will center on short term bonds, while also working with banks to create a long term financing window (EU companies and banks in particular have notoriously short term financing arrangements) and (2) they take the opportunity to absorb whatever mechanisms exactly they have been using, before now, to hide the massive debt loads that should have been coming due over the past three years.

If you forgot, Europe ended up pulling some master BS, using a combination of trade accounts to gobble up the garbage so that the markets wouldn’t have to see it default. I’m hazy on the exact specifics, but I would gamble that those imbalanced accounts are still outstanding; and my guess is they’re about to get totally monetized.

So the big question now is, where do you park money? I think that it would be very stupid to try and be short right now with central banks making big noise and seemingly readying the cannons.

If this is like past central bank action, then any longs will do – equity, commodities, debt, whatever you like. Oil could get a huge boost since it’s been so ravaged. ECB action will give the Fed room to play, especially if deflation keeps up. Yellen is no Bernanke…yet, but she also hasn’t been tried either. If the Fed coordinates, all boats get lifted.

But the safest low key play is probably just to hug U.S. dollars until things are a little more clear.

I am ~78% cash, with positions in CCJ, BAS and VOC, down roughly 3% in the first two weeks of the year.

BAS Keeps The Lights On

931 views

Take this with a big grain of salt, as there is most definitely a tradeoff occurring here, but BAS just reported this morning that their rig count numbers were…unchanged. There was a drop in rig utilization but all other service numbers were higher than in November.

Now, BAS is about to get whacked hard on margins, as they had to offer steep discounts to customers to keep the lights on. Of course, trading at $6.00, it’s also hard to argue that apple’s not baked in the pie.

BAS is cutting deep and hard here. Their goal is to get expenses below $100 million, which basically gives them a few years of clean life. As long as they can break even (or even just restrict the pain to small losses), they’ll be staying in business.

I really do like this company quite a lot. I bought back much of my position in December, after going 100% cash and mentally picking myself up. So we’re having a little intermission? It’ll be alright.

BAS’ competition is dead. I don’t believe they’re in the same league and we’re about to watch the tide go out for many of them. What’s left will be a stronger industry and for the moment, I’m betting BAS will be a part of that.

BAS also announced they were buying back some stock down here. I’d say terrific but I think that’s mostly symbolic. BAS will need to conserve much cash to survive this.

Alright Time To Turn Around

1,017 views

I am going to lay 2014 bare, fairly and without playing pretty. 2014 was an enormous lost opportunity and, indeed, and calamity of masterful proportions. I do this to put it behind me, log it, and prepare to rise above it.

2014, I ended down 33%.

2014 started out as one for the history books. After pacing 28% in 2013, my book exploded to the upside (and by no means was that an exaggeration, if you were following my positions). I had such a hot hand, with names like BAS and HCLP doubling in a matter of months.

I sat out the tech sector carnage in the spring, unaffected by it. I made money even as others languished.

And what may come as a surprise, I actually called the selloff in both oil and the underlying stocks. In August, penning a self-reflecting piece on how disconnected I was from the real world, up 25% for the year while others were holding on for dear life, I deduced that I should sell out of much of my holdings, if only to reorganize and one up fate.

Then, what may be equally surprising – no, the next sentence is not “why didn’t I listen to myself!?” or equally stupid nonsense – I did sell out of half of my oil and energy positions.

That’s what makes this story so strange. I liquidated BAS from a 25% holding down to 10%. I dropped HCLP from almost 30% to 15%. I trimmed everything. I had 50% cash riding into this bloodbath.

And it still didn’t help.

Yes, I was buying the drop at intervals, but that only accounts for a fraction of the total damage. Maybe somewhere between 5-10%. The other 20-25% mutilation was from 10-15% positions dropping 50%-90% in the span of 90 days or less…

To quote the late J. Ogden Armour, whom I ominously wrote about just before it all happened, “I lost money so fast, I didn’t think it was possible.”

That is it; it’s all on the table. 2014, the year that should have been. Where I let a 25% gain turn into a 33% loss, and more or less had my balls cut off in public.

Good riddance 2014! I hope Venezuela at least collapses totally, as some sort of fucked up consolation prize.