The action in the financials is very alarming.
Aside from [[CFC]], [[WM]], [[PMI]], [[ABK]], [[MBI]], [[SCA]], [[RDN]], [[MTG]], [[ETFC]], [[ACF]] and [[SOV]] all look like they’re heading to zero.
Is it possible?
Yes.
Apparently, the prospect of rising unemployment, coupled with the credit crunch, has investors running from anything related to financials.
Today, I covered some of my [[LEH]] short, but regret it already. Also, I sold my final 2,000 shares of [[SKF]], for a monster gain.
With the proceeds, I will, stubbornly, bet against [[CHL]], [[LFC]], [[PTR]], amongst other China names, via [[FXP]].
And, I have a very rich cash position. Hopefully, we can get a sustainable bounce, so that I may use it to sell short LEH higher.
God willing, of course.
NOTE: It looks like the news of [[DD]] going after [[MON]] got out.
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Basically, anything consumer related sucks.
This is my kind of market. I will soon be able to buy my own tropical island in the South Pacific.
wont the chinese govt artificially keep it high for the olympics?
PZE @ $13 looks tasty for a long term hold. Great posts today Fly, keep it up.
Fly, sooner, rather than later, those bloated pigs will learn to gurgle blood. The Hang Seng is now levitating of its own bullshit, up 500 after yesterday’s tape. Wyle E. has hit the air pocket, but he is still balls out on the sprint. doodoo bidu is losing it’s bid – weird with the sec posting docs from nov and then the strange demise of the cfo. market makers are gunning for it to 300. if it breaks that clear out the cellar. it will have support at 300. too many assramps like fidelity marking their performance to that swine.
BTW:
I called the top in MON earlier. The stock is bleeding red.
Add the student loan lenders to the list: SLM, FMD, and STU.
FMD is the strangest. The wizards at Goldman bought almost 20% of the equity and provded a $1 billion warehouse line to hold FMD over until the ABS market comes back. The stock spiked on the Goldman announcement and has been down every day since.
juju, got into the honeypot did u?
Ag & solar getting shot … they were the last that needed to feel the blade
tomorrow we rally hard
Time to cover?
***********************************************
Kass: Help on the Way?
By Doug Kass
RealMoney Silver Contributor
1/9/2008 11:59 AM EST
Click here for more stories by Doug Kass
This blog post originally appeared on RealMoney Silver on Jan. 8 at 9:29 a.m. EST.
I have friends.
I have friends in Washington D.C.
I have friends who are very close to the Administration.
I have friends who are very close to members of the Fed.
This morning, several of those friends gave me an indication of heightened concerns regarding the domestic economy — far more than what has been expressed by the President, the Secretary of the Treasury, and the Federal Reserve in various platforms over the last week.
And they say that the Fed will ease momentarily.
Enough said.
I guess we should add FXP to the “race to zero” grouping. Chinese Lotto is not a lotto fun.
Great posting today. I usually read your blog for entertainment, but you had some real good stock related shit today. Great call MON. Hats off.
calvino,
I have been short via ETFs and selected stocks since mid-late Oct.
Also bought more FXP.
“This morning, several of those friends gave me an indication of heightened concerns regarding the domestic economy — far more than what has been expressed by the President, the Secretary of the Treasury, and the Federal Reserve in various platforms over the last week.”
What is their measure….how long the line is at Panera this morning?
WW-
Fed easing will do nothing to stave off a recession. There is a 25 bp cut priced in and a 50/50 chance of 50 bp cut, but look what is happening. It is obvious. This market will work its way lower.
Joe Broker is still telling his clients to hang in there. We have not seen the individual investor capitulate—yet. Fund managers will have to sell to raise cash for redemptions since the new inflows are drying up. People are getting scared.
The Fly is correct. Traders should play the market to the downside until signs show otherwise.
I will tear down my grass hut and build a new teakwood sided bungalow on my tropical island as a result of all this.
Ag getting the H-Hammer. Dawgg’s post on MOS was positive, yet the stock is getting spanked today.
The market doesn’t care about current earnings…looking at environment 6 -12 months down the road. Not good IMO.
CFC in big trouble. There are others to come.
Damn my eyes for forgetting to mention!
Um, Fly?
I reversed your “Spider Sense” two days back.
“Mischief of the gods” and all that. Sorry.
Juju, you toy with the fringes of my displeasure.
Alpha has already been disciplined. I’m awaiting an order of grapes and too XXL jugs of virgin olive oil, as “payment for winnings.”
(in place of a virgin sacrifice)
http://www.ibankcoin.com/flyblog/index.php/2008/01/09/whats-good-for-dd/#comment-8387
Shorticus, what have I done now? A double portion of grapes and virgin olive oil is being shipped to Mt. Olympus as I write this.
If that is not sufficient for you, go fuck a lightning bolt.
Juju–agree we are already in recession, but a 50 bp cut will give us a pop to the upside that will be forgotten within a week. Just be careful not to start any shorts here and take some profit on the ones you have. There will be time to reload after the “to no avail” rate cut.
Bearishness exists. How feel you about the markets young Jedi traders?
Longhorn, this day you will when your accounts to zero go.
To the Dark Side have I gone, and good it looks.
WW-
Only short positions I have now are FXP, DUG and QID. Covered CSCO and DELL.
Reloaded only on FXP today. Cash is king.
I do expect a pop, and then will step in and short heavily again.
3/4 of you here are bears.
Thank you for the contrarian buy signal.
Insolent Longhorn:
Don’t look now, but you have been transformed from a “bull” to a “steer.”
No charge.
___________________
Oh, and I’ve also given that “Mack” person two lifetimes of tenure.
Fly,
Are you completely out of MVIS?
In addition to financials it appears the entire market is racing to zero. At this rate the Nasdaq will be zero in …uhmmmmm……..
17 trading sessions.
This shit is setting up for a crash. Until someone jumps from a building, I am not catching this knife.
“Crash”? I love it. You are giving me more confirmation of a turnaround.
Just hyperbole. Don;t make decisions based on me – contrarian or otherwise
Shorticus,
I still have my balls, and they are magnificent.
However, I wonder if your name is in reference to your loin-related “assets”?
Well, I hope there is a bounce.
I’m not only sold out of my Jan SRS calls, but I’ve sold Jan 135 calls on all my SRS – for a premium that looks paltry as SRS accelerates skyward.
SRS is a bet against equity in commercial real estate. CRE will certainly take a big hit, but the hit shouldn’t be anything like the hit to bubble mortgage money and unsold housing inventory. Another big Fed cut could bring a pretty big short-term drop in SRS.
My only remaining hedge is a tiny FXP position, and it currently is taking the shears to me instead of the other way around.
Longhorn,
Once in awhile there is wolf at the door.
I hope I never get dementia to the point that I call extremes in market sentiment based on the posts of a dozen or so traders.
Boomer,
No such thing as a crash. Not when you have people like our friends over at the Plunge Protection Team. Wouldn’t be surprised to see a strong reversal perhaps even later today.
Crashes happen when everyone is waiting for a bounce before buying.
You see, everyone is still selling, but there are no buyers, because they buyers are waiting for a bounce. The shorts figure they’ll cover on a bounce. The bounce never occurs, and then you get capitulation.
That very situation is what happened in 1987.
Wood … Is this the 2nd or third leg down? Looks to me like we’re in the 2nd wave down of the third leg … anticipating a bounce soon and then the 3rd wave down of this final leg to 12,000 … any thoughts?
Woodshedder,
There are foreign buyers lining up to buy American assets. This next rate cut will provide more impetus. Sorry, no crash.
1st leg down in August, 2nd leg down in October and third leg about 2/3’s completed … bottom around Feb/Mar followed by some base building till Memorial Day … Developing ….
Or do you consider that selloff in August to be in an uptrend forming the double top and hence this only the 2nd leg down?
Longhorn, I didn’t say there would be a crash. I simply remarked on the alignment of sentiments that could precipitate the event.
The next rate cut will send Gold to the moon, will weaken our already weak dollar, and will increase the costs of food and energy to the American consumer. That is not good. What it will do is mitigate, to a tiny extent, the damage from worthless commercial paper. It will be a billion dollar bandaid on a trillion dollar problem.
Look Longhorn, the Fed doesn’t cut when the situation is rosy. The Fed cuts when the situation is dire, as it is now.
Longhorn, please tell which Foreigners are buying. Also, please show me in the past anytime when the Foreigners have timed their entries correctly. Also, please tell me, of the Foreigners who have bought, which ones have purchased assets which are worth more today then when they bought them.
Of course we will bounce. When we do, go to cash, or get short. You will not survive staying long through this correction.
E8- I have this as the 2nd leg down.
Basics have played well this week (SMN long, IYM short, RTI short, FCL short and OLN short). All have outpaced the markets decline this week. S&P and DOW have declined approx 2.3% this week, while SMN has run 8.6% and IYM has declined 4.14%. We are in bounce land for the the DOW as 12564 is at the target level coming out of the H&S breakdown that started on the 2nd. Expect cooler heads to prevail for a few days from here. However, I see the Basics (SMN in particular) still looking at a 8.5% run before a major rest. Once this bounce weakens, it’s back to piling on the Basics.
wood, portfolio insurance was the main culprit on 10/19/1987. and of course james baker stupid remarks the day before. other than that you’re spot on in your remarks.
all the foreigners that hold 1 trillion plus in us treasuries are huge winners so far.
When I look at my FXP, I want to gouge my eyes out, Odd no?
Long UWM at 50.86. Gonna skim some off this bounce.
bought 100 calls on the spy, expect a big move up. Options expire next friday and I am sure the market will be up 5%.
machine based buying kicked in @ 12,500 like clockwork
NewE- where’ve you been?
let’s talk more FXP
ready to hammer more?
vacation / counting my money.
Neweq is right.
Options expiration week always goes the other way, to make a fool of the current majority.
We’ll be back at SPX 1450 by the middle of next week.
Banks and brokers ripping. Maybe there’s something to Doug Kass comments about an emergency FED meeting to cut rates.
PPT action is similar to price controls. It doesn’t end up working. The market is the final arbiter.
cleared 10k on Fly’s RIMM rec. 5/50sma ding from mobo bo @94.57. Beautiful thing.