Despite todays bullshit rally, Chinese stocks, led by [[CHL]] and [[LFC]], are receiving multiple “homo hammers” to the head. As you know, [[FXP]] is “The Fly’s” largest position.
However, just to clarify, I am not up on the position, as of yet. Many of you must be thinking: “why is this asshole so happy about a down position”?
Answer: Because I have seen the future and it has lower Chinese stocks prices in it.
Those fuckers (China) are running with 8.5%+ inflation growth. Who gives two fucks and a ladle if they grow at 10%, while inflation is so out of control?
Enough about me. What are you losers doing?
Let me guess: reading some winners blog, while making believe you are Gordon Gekko, minus all the money and shit?
Look you, I’ve got a lot of personal wins going on here. You’re all lucky and blessed to have such a “God-Broker” blog during the day, helping the unwashed understand the markets.
Regarding the markets:
Don’t you think it’s time to “go away in May”? After all, we’ve been on a terrific run as of late. With my money, I like my chances short [[POT]], up at these levels, while long a refiner or two—for a trade. Due to extreme negative sentiment on the sector, the refiners are due for a prolonged bounce, despite my past joke—calling them “the new airlines.”
My watch list includes: [[VLO]], [[TSO]], [[HOC]], [[DK]], [[SUN]], [[ALJ]], [[WNR]] and [[CLMT]].
Also, for a trade, I like some of the ethanol plays. These stocks have been pummeled to death, then killed again in their afterlives.
In the ethanol space, my watch list includes: [[VSE]], [[AVR]], [[BIOF]], and [[PEIX]].
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I asked my good buddy, the Fleckmeister, a bears bear, who just had a luncheon with Marc Faber, who is talking financial & global armageddon, if the short side was drawing him back in yet. He replied:
• Nope, not yet…Goldilocks type fantasy + money printing requires some patience still I think
Heh, ethanol. Refiners are big buys here for trades. As is short LEH and UPS. Gas prices trail oil, and the government won’t be able to keep the price controls on forever.
i bought some GME for a trade today. i think it’s got a few points in it over the short-term.
i still think the refiners are toast, but if crude drops again, they’re going higher.
Insensitive bastard…biggest earthquake in 58 years, thousands dead, and this asshole is bragging about shorting China.
Go suck a bible…
This can’t be good for ChinaLife Insurance no?
Fuck you Mike.
I’ve been shorting China, before it was popular. Earthquake or no earthquake: fuck China.
UPDATE:
Big Mike:
Now you’re thinking.
Big Mike who gives a fuck about a few thousand? Why are you not talking about the possible fucking 1 Million People dead in Myanmar? You sound like those fucks complaining about Katrina, 800 vs. 1,000,000. Personally I would say we had it pretty good.
By the way I know your kidding. And yes China Life should get fuckered.
fm minyanville –
Complacency in tech developing…
I guess I understand why folks would buy tech over financials. I can at least understand Microsoft (MSFT) and Oracle’s (ORCL) balance sheets. As for Citigroup (C), Merrill (MER), etc, ummm… not so much.
My firm tracks the Rydex inverse and non inverse fund assets as a percentage of total assets. We’re now at the lowest level of bear assets as a percentage of total assets In seven years at 6.5% (smoothed for five day average).
The last time we were below 10% was at the last breakdown point. With the VXN collapsing and AAII bears at 24%, I would say retail has now fully bought into the rally.
Can it go higher? Of course. I just wanted to point out the fact that risks have risen substantially.
I like the set up on NXTM. They report tonight so be aware. However, its been hammered and I think the down side is limited.
How about a late day new high rally in USO today? Being that its an outside day down I am sure the bulls just forgot to wake up this morning but will be back tomorrow guaranteed and we will see a new high.
Re-Started a small SMN position.
Oil goes up, stocks go up.
Oil goes down, stocks rocket up.
Someone remind the tech stocks summer is coming, ffs.
Oil is starting to look overbought. Expect a pause or a fairly signficant pullback near term.
Roger that Cubs. Stocks should trade higher.
TSO is a breakout buy here.
The bull case for Valero
So what’s with Valero, anyway? Aren’t high oil prices supposed to be good for everyone in the industry? Hardly. Rather, Valero pays high oil prices for crude, then tries to eke out some profit by refining it into usable fuel, and selling it downstream.
As KnightofShadows explains, Valero and its compatriots face much the same situation hurting the car owners to whom they supply gasoline:
Valero’s margins are being squeezed by high oil prices. When oil prices eventually drop, and they will, Valero’s margins will improve. The current commodity/oil cycle is about to end, and I expect to see oil back in the $70-$80/barrel range soon.
rhallbick boils down the strategy for us:
Buy refiners when crack spreads have been squeezed. Sell refiners when crack spreads are wide (unless you love volatility in your portfolio). Long term, they can sell all that they can make, they just have to accept the current market price. Just re-established my real position in [Frontier (NYSE: FTO)], just because I like those guys a lot. I don’t know what the catalyst will be to improve their spreads again, but something will change. It always does.
Financials are putting in a decent showing. Notice how when they’re up, the market is up? Hmmm… All you have to do then is follow the financials. That will tell you the direction of the market.
Pssst…I have seen the future and it has upgrades in store for JPM.
If the Chinese build airplanes the same way they build toys, make cat food, farm fish, etc. then there will be no way I get on one of those things.
Okay, the volume sucks, so I’m calling a top right here at 12,900.
Just call me “King Canute!”
(Jake likes to think he has a time machine.)
China is at 10% inflation. They have tighten up the Yuan. They have placed export restrictions. They have stopped foreigners from owning Yuan. The government has forced its banks to increase their reserve requirements.
In the meantime, the U.S. cut rates to 2%. The Fed has opened up the discount window for non banking institutions. They accept anything that is AAA. The Fed auctions off billions of dollars every weak. And yet, we are only at 2% inflation. Amazing, huh.
Note, the U.S. is more communist than China. Somebody wake up Fly and tell him we have an inflation problem here too and it also affects our growth/recovery.
Gapping, VLO is in the best position to make money out of refiners with shitty crack spreads. They own tons of refiners that run shitty sour crude. Some crude prices are valued way below the benchmark (WTI). SGC- Southern Green Canyon crude which they run, and are partnered in with EPD is priced $7 under WTI. Mars, a huge gulf coast platform is about $7 under WTI as well. Notice VLO is trying to sell their sweet crude refineries. They just sold Krotz Springs. A sweet running refinery (more expensive crude). Memphis which runs a lot of sweets is trying to be sold as well.
Crude short VLO long TSO is working well for me. TSO has a possibility of a full buyout as well. Don’t get me wrong, your probably right but the trade is working for me right now.
Doesn’t FTO process cheap heavy crude from Oh Canada?
Thought that was the best (per Barrons), no?
You are correct, FTO is good. They also run very cheap crudes from oh Canada. The problem is they only have two refineries and are very limited on their optimization of crudes to increase margins. VLO has a much wider range of gathering/shipping and purchasing options.
I got some love from China also. HOGS was up 9%