Listen, I’m not going to tell you I told you so (cough, Cain, cough), but…

Pppff. Who am I kidding trying to take credit for this?  This was like the little brother acting tough, talking shit, puffing his chest out while big brother hovers behind him. There’s no way I would have ever, EVER, been as emboldened as I was with my recent convictions in print without PLUTONIUM PETEY’s guiding light. I don’t profess to know very much about technical analysis, valuations, etc. What I do know–from my days as an active sports bettor–is that when a herd gathers and then begins to build momentum on the heels of the same, regurgitated arguments, look out. And when that herd is led by none other than the incorrigible Tyler Durden of Zero Hedge, WATCH THE FUCK OUT–your portfolio is destined for losses of murderhole-sized proportions.

(As an aside, what I think is funniest on monster rally days like today, is Zero Hedge’s sarcasm-filled reaction. All their titles sound something like, “Market Inverse-Plunges,” “Retail Refuses to Go Back into Stocks No Matter What the Market Does,” and, my personal favorite, “China will not hesitate to protect Iran even with a Third World War.” Like, okay dude, we get it, you think the Dow is 11,000 points too rich. Just hilarious to see him pump out Bearshitter headline after headline the way a raving lunatic would in the midst of a 7% rally in three days.)

As everyone else, I’m eminently thankful to the Greatest Chairman of our time, Benjamin Bernanke, for winning me back my money. The Bernanke pimp hand continues to be in full control, as it makes end-of-month appearances to slap the Tyler Durdens silly.

There’s really very little else to say about this tape. If you were positioned with your balls on the chopping block long over the weekend, it’s probably a good idea to take some off the table. I myself trimmed some of my AG today, in hopes of buying it back on a dip in the next couple of days.  I also picked up some GSVC, as it seems primed to move higher. If not now–with Facebook/Zynga IPOs imminent–I’m not sure it’s ever going to move much higher than NAV. And let’s face it, its true allure is as an investment proxy for something inaccessible to most investors.

If we do, indeed, get that vaunted 2-handle on the Friday BLS report, it will be on like DONKEY KONG-COLOMBIAN COCAINE STYLE. We will likely rally into the end of the year like mofos and even spark tectonic shifts in sentiment. In the coming months and days, I will be monitoring my Facebook news feed for tells, as “market morons” start to dish out stock picks and their minions “Like” them. Then, I will know it’s time to do the Durden. For now, we feast with Santa while (salsa) dancing on the graves of turkeys.

http://youtu.be/E6wGBoQE9qc

The DOW will rally 1,000 points on Monday.  Forget the bread crumbs–nothing but beluga caviar is on the way:

The report, which echoed a Reuters report on Friday from Brussels, quoted German government sources as saying that the crisis fighting plan could possibly be announced by Merkel and Sarkozy in the coming week.

The report said that because it would take too long to change existing European Union treaties, euro zone countries should avoid such delays be agreeing to a new Stability Pact among themselves – possibly implemented at the start of 2012.

It could be similar to the Schengen Agreement that allows for uninhibited cross border travel for citizens in countries that take part. Among the countries in the Stability Pact there would be a treaty spelling out strict deficit rules and control rights for national budgets.

The European Central Bank should also emerge more as a crisis fighter in the euro zone. The ECB is independent and governments cannot tell it what to do. But the expectations on the ECB are clear, Welt am Sonntag wrote.

“Based upon these measures, there should be a majority within the ECB for a stronger intervention in capital markets,” Welt am Sonntag said. It quotes a central banker as saying: “If the politicians can agree to a comprehensive step, the ECB will jump in and help.”

In Brussels on Friday, euro zone officials said a push by euro zone countries toward very close fiscal integration could give the ECB the necessary room for manoeuvre to scale up euro zone bond purchases and stabilize markets.

The ECB, which cannot directly finance governments, has been buying Italian and Spanish bonds on the secondary market since August to try to keep down borrowing costs for the euro zone’s third and fourth largest economies and contain the spreading of Europe’s sovereign debt problem.

Such tight fiscal integration is being considered by France and Germany, the officials said, with Berlin pushing to change the European Union treaty so that a country could be sued for breach of EU budget rules in the European Court of Justice.

As I noted in my previous post, this is about Europe (Germany) sorting through a coordination problem. With every country staring down yields headed for, like, OMG, 100%, they have now become totally on board with abdicating their sovereignty to the Reich, leaving Nazis wondering why they never became central bankers. Now that Europe is, for lack of a better word, coordinated, we can resume the Clam’s regularly scheduled programming, aka SANTA MELT UP.

I’ve posted numerous times in comments sections about my absolute enmity for ZeroHedge. It propagates fear at any and all costs–especially at the sake of, you know, actually banking coin. In fact, there are few financial sites on the interwebs that offer less actionable trading ideas. If you think it reads like a jaded investment banker who just got kicked out of the “club,” then you’d be right.  At its worst, it’s a mecca for bearish confirmation bias. At its best, it’s a phenomenally accurate contrarian indicator.

If you peruse ZH right now, you’ll observe a community that’s lathering in Europe’s gross incompetence. As they go from six to midnight and futures bleed lower, it’s extremely easy to resign yourself to selling the open and loading up on puts. But no, no, my friend, that’s not how this game works. You need to dig beyond the headlines plastered across ZH. For example, note the following from Reuters:

Eurobonds will exist at some point in the future but are not suitable at the current time given insufficient integration among euro zone member states, European Central Bank Executive Board member Jose Manuel Gonzalez-Paramo said.

 

So while ZH is busy telling you how Merkel has, for the umpteenth time, spurned the notion of Euro Bonds and how this means that it will therefore never, ever happen, you need to read the above and connect the dots–namely, Europe is in the midst of sorting its way through a coordination problem between the ECB and sovereign governments. Once some semblance of fiscal integration is achieved, the presses will be revved up. In the meantime, Merkel cannot concede anything until the sovereigns are de-sovereigned. It will happen. And likely much sooner than any of us think.

I covered my CRM short the other day and with the proceeds bought some WNR and a lot of EXK, AG. I’m prepared for a leg lower here, even a break of the vaunted Bennett Bottom (though this would truly be a scary, scary test). Regardless, at this point in time, with all the Zero Hedgers screaming from the rooftops, claiming victory over the sheeple and the rest of the civilized world, the high probability trade here has to be long. Now that the turkey gods have been devoured for their total insolence, we need to prepare ourselves for what’s likely to be a Santa Rally into the New Year.

Update: Giddyup

Before I launch into my diatribe on the state of the markets, a few thoughts on salesforce.com:

While a cursory look at their earnings might inspire some confidence, a deeper dive (and subsequent commentaries) leave a lot to be desired.  I shorted CRM with a full understanding that this was the mo-mo of all mo-mo stocks and could rip higher with my face at any time. And while the after hours trading was encouraging, I’m hardly prepared to declare victory yet, though I am emboldened by today’s events.

They missed on deferred revenue, which, by all accounts, is what they’ve been preaching as the key reference point for investors. Instead, now we’re hearing Benioff retreat from emphasizing strong deferred revenues; instead, he’s now underscoring the importance of their recently initiated 2013FY guidance.   The revised narrative should hardly engender much confidence in CRM bulls.

As a bear, what was more encouraging was Benioff’s Mad Money interview.  Give Cramer some credit here–he pressed Benioff on multiple occasions.  In one exchange, when asked about growth in Europe, a perfunctory “We see growth in all markets” answer was all Benioff could muster.  When asked why CRM no longer reports new account totals, we were told that it’s because it’s too difficult for CRM to sort between their new customers and accounts that came along with their recent acquisitions.  Got that?

In the famous words of Happy Gilmore: I know what you’re doing, and I don’t like it.

Tomorrow might give us a bounce from the after hours lows, as there are plenty of underwater shorts in this name.  Then again, with its high institutional ownership, CRM is vulnerable to massive sell-offs.  A market leg lower would certainly facilitate a GMCR-like crash in CRM, but at minimum, even if the overall market leads higher, the CRM growth story looks like it’ll be on hold.

Looking at the broader markets, I am at a loss as to who has the stones to step in and catch this knife.  We’re still green for the year, despite falling out of this perfect triangle everyone’s talking about.  Let’s rehash the headwinds, shall we?

Europe.  A looming super committee failure.  Civil war in Syria.  VIX north of 30.  Europe.  No resolution to the MF Global debacle. There are no shortages of scary headwinds.  I remain wholly on board with many market participants’ thesis that, eventually, despite what ECB officials and the Merk say, the ECB will step in and be the buyer of last resort.  End of story.  They will print.  But to get there, the market needs to force Draghi’s hand.  The slow motion car crash sounds like an apt metaphor here.  We can’t get to the printing without the crash.  So, it’s coming.  Be careful.  Be nimble.  The Turkey Gods implore you.

Update: Thou shalt not doubt the Great Tim Tebow.

… to the last I grapple with thee; from hell’s heart I stab at thee; for hate’s sake I spit my last breath at thee.

For many captains greater than I, the demise of Salesforce.com has proven to be a monomaniacal pursuit of sorts.  It has steamrolled bear after bear in its ascent higher.  Even by the dot com era’s standards, this whale has gotten out of hand.  Surely, you are already familiar with the myriad of rationales as to why this stock should be GMCR’ing lower, so I’ll refrain from rehashing the litany of eroded fundamentals.  This stock is the poster child for axioms like, “Markets can stay rational longer than you can stay solvent.”  So why bother going after this great white whale?

For one, I am forecasting extreme market weakness in the near to medium term.  The recent, epic descents of some high-flying stocks–NFLX, OPEN, and GMCR, to name a few–have proven that, in times of serious market contraction, investors are simply not willing to pay for high-priced growth.  As volatility has reigned supreme, the margin for error on earnings has proven to be razor thin.

The aforementioned market realities, coupled with what appears to be a very favorable technical set up, make this high time to get short CRM.  Importantly, please note that I have very minimal technical expertise.  I am very much inclined to side with Fly’s sentiments on technical analysis.  Then again, I see some of the great work chessnwine/ragin put out, and I’m finding myself using it more and more to buttress my trading ideas.  Nevertheless, behold:

If we use the 200-day as our key reference point, it appears that what was formerly support has now become a level of resistance.  Getting short CRM is hardly a contrarian trade–you might even argue that it’s somewhat of a crowded trade.  And with earnings on tap this week, it’s possible this thing reasserts itself higher.   As such, I’m prepared to limit my upside exposure vis a vis a stop at $137, firmly above the 200-day.  Let’s see if this ends with a better result for me than it did for Captain Ahab.

Update: Well, that’s great to see–wake up to a pre-market explosion higher thanks to the fuckshows over at Citi.  That’s multiple upgrades this thing has received in the last week.  Hmm… Moved my stop up to $142.

As I sit here, second guessing myself into fantasy football start-or-sit oblivion, I am overcome by a surge of inspiration to take advantage of the glorious blessings the iBankCoin network has bestowed upon the sheeple.  Let me disclose up front: my only qualification pertaining to (financial) blogging is an aptitude for proper grammar.  Beyond this, I have little to no expertise in the arena of financial markets.  Then again, this blog isn’t intended for you, fuckface.

Instead, my intent is to use this space as a diary of sorts, whereby I can bring some structure and order to the disparate thoughts and feelings I’ve been brooding over since the August legs lower.  I preside over what you would refer as a “bullshit Zeeco”  account.  Before August, it was–at least by my standards–a distinguished, gentlemanly account, something closer to Charles Schwab than Zeeco.

Nevertheless, the winds of change have derailed dreams of retiring from work after only two years and returning to the glorious malaise of undergraduate studies.   The past couple of weeks have really perplexed this amateur investor.  In fact, Friday’s “bullshit” rally proved especially frustrating.

What’s this market pricing in right now?  I am wholly on board with the Fly’s “Print, baby, print” thesis in regards to how Europe will solve its problems.  But to me, the lay, non-space alien, that’s three or four trades down the line.  Don’t there need to be serious shocks to the system to force Europe’s hand to the presses?  How can decades of political and cultural aversion to printing (read: Germany) be subverted by 180 degrees without any real pain inflicted by markets?  Is an ephemeral kiss of 7.5 on the Italian 10-year enough to spook the Merkel Monster into dusting off her wheelbarrows?

Markets have roared higher in response to the recently installed trail of technocrats.  From Greece (Papademos) to Italy (Super Mario 2.0), market fears of contagion seem to be wholly assuaged.  But, again, I’m left confused.  How is it taken as a given that these countries now have their financial houses in order, just because some former ECB-lemming is now at the helm?  Make no mistake: Europe is already in a recession.  In the face of this, their policy response has been to try and preserve their (irrelevant) AAA ratings vis a vis draconian spending cuts.  Europe is in the process of manufacturing their own DEPRESSION.  And today you have the ECB refuting the UK Telegraph’s report that the ECB had to purchase hundreds of millions in bonds that were “left over.”  Oh, and this in an auction for just Irish debt!

So, market masters, space alien magicians and the like, let me get this straight–Europe is in the process of manufacturing its own GREAT DEPRESSION and the EFSF is a total sham?  Right?  Riiiiiight.

As of Friday’s close, I remain positioned for collapse.   Short CRM.  Long VXX and TZA.  Last week, amid the turmoil, we saw numerous intra-day reversals and even managed to close the week in the green, despite Wednesday’s blood bath.  I’m hoping that Monday is a “sell the rumor” type of day, so that I can, at minimum, shed my retardo ETF longs.   I will lay out my thoughts on CRM in my next post.