Ahh, I feel much better now. I apologize to you for my coarse behavior over the past 9 months. You see, I was rather agitated. Such is not usually my vocation, but, well…everything last year went so wrong.

I should not have to point out that, in my first year counted amongst the ranks of iBC Contributors, I had high hopes of grand slams. And I got them, early on. But in the stock market, your grand slam is never safe. It can always be called out.

Watching my claim to victory get wrenched from me like that last year was almost more than I could bear. The shame!

But now, all is forgiven.

I sold TVIX this morning up 20% on the net position. That added about .5% to my annual performance this year; not bad for such a small stake. But the product is rotten. Stay away from it.

I wish I might have held onto SCO another two days, sure, but given the size of my net energy shorts, something had to go. And I even got out of the oil half of the trade with small profits – so 2011 was not a complete waste, I suppose.

(No, it really was a complete waste…)

So all that remains is to hold ERY. And here I am torn – ERY is quite a large position, so I may have to scale it back today. I don’t want to go into the weekend overly exposed, because I believe that “something must be done.”

But I also don’t want to hit Monday and have a meltdown materialize with no ponies in the race.

My cash position stands around 20-25%.

Now, let there be no more hostility between us, friends. Enjoy your weekend.

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Today is a most special, beautiful, glorious, miraculous day. Take a look at some oil ETFs, and you just might notice that the oil accident of 2011 is quite gone.

I’m up 16% YTD, and there is nothing you can say to me to bring me down from this high.

FUCK YEAH!

The oil trade from last year was a disaster, and well it should not have been. It should have been one of the biggest trades of mine, to date. But I held on too long, and got crushed inside of a month.

Oh well. Who gives a fuck.

Guess what? 2011 never happened, as far as I’m concerned. I lost that money playing UCO; UCO is now right back where the horror began in October. In December, I switched my position from being short UCO to being long SCO and began gobbling up ERY.

After cutting positions, rebalancing myself, and strategically adding to SCO, I finished this long clusterfuck today by dropping my ENTIRE SCO position for $48.45.

MAY IT BE DAMNED. AND I HOPE THE LITTLE RAPSCALLION WHO SCREWED WITH ME CHOKES ON A HOTDOG.

Sadly, this is not the end. I lost over 20% last year. Part of rebalancing was done by selling BG which was subject to mind-numbing losses when I did so. Plus, currently AEC, CLP and CCJ are all selling off. By my calculation, in order to really wipe away 2011, I need to earn another 9% in gains.

And that’s what ERY and TVIX are for.

My sell point for ERY remains much higher from here – I’d like to let the position go north of $18. TVIX has so far been horribly disappointing, but if I could sell it at $11, I’ll have made plenty.

Today was excellent; the blood is hemorrhaging now, and hedge funds – particularly the commodity variety – are being dragged into a wood chipper by their disgusting bow ties.

I WILL NOT BE CAUGHT LIKE LAST YEAR. After this victory, I’m taking my winnings and going to fucking cash.

This morning, I purchased a half stake in APC. There’s a blast from the past. It’s a screaming buy here; that company is elite.

Going forward, I intend to complete my reinvestment in APC, add to silver, and cash out of TVIX and ERY, holding an oversized cash position of 20%.

Now watch in awe. The 9th floor is closed for the rest of the day. I’m getting drunk and dancing on my desk. Get the fuck out of here. And stay the fuck out of here until tomorrow.

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Pundits warned you that oil markets were terribly constrained and could easily undergo a supply disruption.

What actually happened was demand cratered globally creating a supply glut. We’ve had a 30 million or so build of barrels (that we know of) within 2 months, and it doesn’t look ready to let up, creating the most excessive inventory in over a decade. And demand is still falling.

Pundits warned you that Iran would escalate tensions in the Hormuz straight, leading to those supply disruptions, as war slowly broke out in the Middle East, sending the price per barrel to $150.

3 US Naval Carriers accompanied by untold support vessels and crippling sanctions later…not so much. It looks like Iran is at least putting on the show of brokering peace, as their face saving rhetoric barely conceals the panic their ruling clerics must feel every time they see prices of goods; or worse, the Iranian people’s reaction to the prices of goods.

Anything else punditry fucked up on?

I can think of one major issue: Japan.

At the moment, recall, Japan has idled their entire nuclear reactor capacity, opting to supplement the lost power infrastructure on imported carbon sources. The primary secondary fuel for this process has been oil. If that sounds stupidly expense, that’s because it is.

This summer, Japanese ministers and power companies have warned of rolling blackouts countrywide, as these methods fall short of peak demand. Before the tsunami struck the nuclear plant last year, causing widespread panic and the nuclear ban, Japan got >25% of its power production from nuclear.

This is going to force the Japanese’ hands. They will turn those power plants back on. It was crazy to think they could pivot away from such a key component of their economy so quickly. I mean, they’re an island, for God’s sake; it’s not like they have access to plentiful selections. And when the world’s 3rd largest country recants their recklessness, their need of crude imports for power generation will fall equivalently.

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Well well well well well…

My targets for ERY are $16-17.

My targets for SCO are $48-50.

My targets for TVIX are $18-20.

I’ll be buying a round of SLV or AGQ (hat tip to Chivo) when spot silver gets below $27.

I’ll follow up with a purchase of real physical silver when the $EURUSD gets close to last year’s lows – around 1.26-1.27; somewhere in there.

Around the same time, I VOW ON ALL THAT IS HOLY AND SACRED TO LIGHTEN UP THIS GOD FORSAKEN SHORT OF ENERGY, WHICH OH SO NEARLY CLAIMED THE LAST OF MY SANITY.

Merry Maymass,

Cain Hammond Thaler

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Cameco announced yesterday that they are going through with plans to acquire Nukem Energy for $136 million, plus taking on Nukem’s outstanding debt of another $164 million – which is expected to be reduced by current cash flow before the deal closes towards the end of this year.

I’m still not sure what I make of this. But here are the basics.

Right now, there are two primary sources of uranium, if you are running a reactor. You can get it through the miners, or you can get it through old, decaying empires like Russia, which are decommissioning some of their nuclear warheads.

Places like Russia take the Highly Enriched Uranium (HEU), and mark it for use in reactors; I’m not sure if they physically do anything to the uranium to “de-weaponize” it, or if they just keep very close watch on where it goes. Nukem Energy brings together these parties and brokers sales.

Now, the uranium space has already been getting pretty excited, because Russia (which for obvious reasons has been the largest supplier of the ex-military grade fuel) is set to stop decommissioning warheads sometime soon. There was already a good expectation that companies like Cameco would see the fruits of that development as a key source of fuel goes offline, leaving more reactors than fuel to run them.

So I’m confused why Cameco is busy dishing out a few hundred million to acquire the brokerage that has been making revenue from deals that are about to decrease in volume substantially. This confuses me.

But on the flip side of that, Cameco is now increasingly in charge of uranium globally. If you’re looking for fuel, you’re probably doing business with them. They just recently broke into US markets. They are busy expanding their production targets by 70% by 2020. And now, they control one of the primary sources for acquiring uranium at market that doesn’t involve working with a miner.

What will happen from here? Will Cameco keep Nukem Energy up and running as the business is? Will they jack up spreads for brokering deals, helping push uranium prices higher? Or will they just scuttle the brokerage and force the system to deal with the inevitability of HEU becoming unavailable – but right now, months or years before anyone was planning?

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Don’t let my seemingly eternal caprices of bearishness cloud your impression of me. There was a time, not long ago, when I danced in fields of lilac bushes and mustard, clad in three piece suits donned in precious metals.

Not long ago, I wrote long articles articulating the evil Federal Reserve’s desire to destroy the dollar and crush humanity. I went long stocks on borrowed money, because I could.

In the grand scheme of things, it has only been very recently that I locked myself in my 9th floor office, raining predictions of doom on those of you gathered outside.

But, now something interesting has happened.

In December of 2010, saddled with large gains from silver bets around $15, which were undergone almost entirely with borrowed money, I liquidated enough of my holdings to wipe out my outstanding debt, keeping the difference.

Today, silver trades below the price I sold out at.

This is naturally a very tantalizing development for me. If silver can get 10% below that price point, I would be all but required to step in and double my holdings by using credit.

As of this moment, I have only a very small position of borrowed funds, which I used to step up my SCO position some time ago.

Particularly with June approaching; with things looking very bleak; and with this godforsaken energy short nearing break even at breakneck speeds; I am piqued by the opportunity to wash myself clean of 2011 and modestly expand my precious metals position.

However, this will not happen just yet. There are many underwater oil bulls who need to be drowned to death first. Crude will touch into the $80’s before this is over.

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