Consider the idiocy of technical analysis (no offense to Brian from Alpha):
Had you been playing Gordon Gekko in your basement office a few weeks ago, fiddling through Fannie Mae [[FNM]] , Freddie Mac [[FRE]] and Lehman Brothers Holdings Inc. [[LEH]] charts, you might have bought them—due to a “pending breakout from the base,” or something stupid like that. Then, all of a sudden, one day you walk down to your moldy office to check a few morning quotes, then BAM: FNM and FRE are at zero, punching a hole through your “morning mug,” courtesy of Premier Paulson.
Seeing how positively the other banks were reacting, with most up more than 6% that day, you bought more LEH— with the courage and fury of a mountain lion trapped inside a gay club, located near the outskirts of San Fransisco.
The following morning, you step into your “work arena” and BAM: your face gets ripped off by another 45%.
The moral of the story is: if you do not have it, you cannot manufacture ways to get it. Only a select few can manage money, with God-like precision, like men who walk in the shadows and punch people in the kidney’s with empty monster energy soda cans, just for a few good trades.
As it pertains to this tape:
Use your charts for the indices, not individual stocks.
Finally, this was your bounce, gentleman. Now get ready for the real fun.
NOTE: For the day, “The Fly” was up more than 4.9%, led by gains in commodity related names and betting against Bill Miller.
NOTE II: The preferred market is officially closed for many banks, thanks to Comrade Paulson. It will be interesting to see how they raise capital, within the next week.
[youtube:http://www.youtube.com/watch?v=0uryFnPuq8A 450 300] If you enjoy the content at iBankCoin, please follow us on Twitter
Fly,
You still pressing your FCX/DIG/POT longs? I am just wondering, if you are expecting carnage, then wouldn’t these stocks take it in the chin as well?
Well, the commodities are way oversold, due to redemptions. I like them for two reasons: 1. A Hedge against my market shorts. 2. Valuation.
…with the courage and fury of a mountain lion trapped inside a gay club, located near the outskirts of San Fransisco (sic).
G-DAMMIT!!
Does anyone know if Diet Dr. Pepper corrodes a plasma screen’s “innards?”
__
Frogger. This market is like Frogger.
Congrats on the 4.9%. Bill Miller is envious, no doubt.
I think it is just Coke that dissolves stuff, Jake, you should be okay.
Stop splashing the pot!
Long BA
the action in FCX was encouraging today. led things off by reducing their forecast, yet the stock was up 6% or so. i thought about putting in a buy at the open, since 65 is a solid pivot point, but i decided to wait and see if it would hold 69 into the close, since that level is a big support/resistance area.
as usual, i had a plan to sell SKF when UYG hit 20, and i fucking didn’t, because i’m a fucking idiot. i almost puked it up at that point, but that whole afternoon financial ‘rally’ was based off those clowns on burnett’s show, so i let it ride.
i want to sign up for the donny school of trading, so i can have a lexus, too.
I hated the 3pm reversal. Pure hate for that… I was hoping for a little bit more of bounce.
If you are correct, and that is indeed “it” for the bounce, then we’re almost too screwed for my comfort levels.
Just tell us when we should start stocking food and water, okay?
-DT
What about gold? fuck
Add to that that a huge amount of short term notes from 2007 are starting to expire in September, which is going to create another liquidity problem for financial institutions. The fun is just about to begin…
Ivan Drago aka The Fly sans apendics looking to take down Bill Miller, “I must break you”
Conspiracy Jeff … check this bit out for Gold and silver
http://www.minyanville.com/articles/gold-GSS-NEM-SSRI-PAAS-silver/index/a/18891
Feels So Good
Gold’s not actually good for anything except jewelry. How much demand will there be for that in a global recession?
DZZ been bery bery good to me 🙂
Gold’s a store of value in a hyperinflative environment. Right now, there’s more risk of deflation than inflation.
That said, the Fed will not allow deflation to occur, and they will continue to cut and crank fresh minty greenbacks until we’re back in 1979 again.
So accumulation is probably not a bad idea here.
_
Costanza Trade. Russia invaded Georgia and gold tanked, pardon the pun. Seasonally, Sep to Dec is the best time of the year for gold.
What’s to stop the Chosen One from seizing all the gold the way FDR did in 1933?
LEH will there be a dead cat bounce???
Great vid, Fly. Especially the last minute.
-DT
Comrades Bush, Paulson and Bernanke Welcome You to the USSRA (United Socialist State Republic of America)
Nouriel Roubini | Sep 9, 2008
The now inevitable nationalization of Fannie and Freddie is the most radical regime change in global economic and financial affairs in decades. For the last twenty years after the collapse of the USSR, the fall of the Iron Curtain and the economic reforms in China and other emerging market economies the world economy has moved away from state ownership of the economy and towards privatization of previously stated owned enterprises. This trend was aggressively supported the United States that preached right and left the benefits of free markets and free private enterprise.
Today instead the US has performed the greatest nationalization in the history of humanity. By nationalizing Fannie and Freddie the US has increased its public assets by almost $6 trillion and has increased its public debt/liabilities by another $6 trillion. The US has also turned itself into the largest government-owned hedge fund in the world: by injecting a likely $200 billion of capital into Fannie and Freddie and taking on almost $6 trillion of liabilities of such GSEs the US has also undertaken the biggest and most levered LBO (“leveraged buy-out”) in human history that has a debt to equity ratio of 30 ($6,000 billion of debt against $200 billion of equity).
So now Comrades Bush, Paulson and Bernanke (as originally nicknamed by Willem Buiter) have now turned the USA into the USSRA (the United Socialist State Republic of America). Socialism is indeed alive and well in America; but this is socialism for the rich, the well connected and Wall Street. A socialism where profits are privatized and losses are socialized with the US tax-payer being charged the bill of $300 billion.
This biggest bailout and nationalization in human history comes from the most fanatically and ideologically zealot free-market laissez-faire administration in US history. These are the folks who for years spewed the rhetoric of free markets and cutting down government intervention in economic affairs. But they were so fanatically ideological about free markets that they did not realize that financial and other markets without proper rules, supervision and regulation are like a jungle where greed – untempered by fear of loss or of punishment – leads to credit bubbles and asset bubbles and manias and eventual bust and panics.
The ideologue “regulators” who literally held a chain saw at a public event to smash “unnecessary regulations” are now communists nationalizing private firms and socializing their losses: the bailout of the Bear Stearns creditors, the bailout of Fannie and Freddie, the use of the Fed balance sheet (hundreds of billions of safe US Treasuries swapped for junk toxic illiquid private securities), the use of the other GSEs (the Federal Home Loan Bank system) to provide hundreds of billions of dollars of “liquidity” to distressed, illiquid and insolvent mortgage lenders, the use of the SEC to manipulate the stock market (restrictions on short sales), the use of the US Treasury to manipulate the mortgage market (Treasury will now for the first time outright buy agency MBS to manipulate and prop up this market), the creation of a whole host of new bailout facilities (TAF, TSLF, PDCF) to prop and rescue banks and, for the first time since the Great Depression,to bail out non-bank financial institutions, and a whole range of other executive and legislative actions (including the recent bill to provide a public guarantee to mortgage for banks willing to reduce their face value).
This is the biggest and most socialist government intervention in economic affairs since the formation of the Soviet Union and Communist China. So foreign investors are now welcome to the USSRA (the United Socialist State Republic of America) where they can earn fat spreads relative to Treasuries on agency debt and never face any credit risks (not even the subordinated debt holders who made a fortune yesterday as those claims were also made whole).
Like scores of evangelists and hypocrites and moralists who spew and praise family values and pretend to be holier than thou and are then regularly caught cheating or cross dressing or found to be perverts these Bush hypocrites who spewed for years the glory of unfettered wild west laissez faire jungle capitalism (and never believed in any sensible and appropriate regulation and supervision of financial markets) allowed the biggest debt bubble ever to fester without any control, have caused the biggest financial crisis since the Great Depression and are now forced to perform the biggest government intervention and nationalizations in the recent history of humanity, all for the benefit of the rich and the well connected. So Comrades Bush and Paulson and Bernanke will rightly pass to the history books as a troika of Bolsheviks who turned the USA into the USSRA. Fanatic zealots of any religion are always pests that cause havoc and destruction with their inflexible fanaticism; but they usually don’t run the biggest economy in the world. But these laissez faire voodoo-economics zealots in charge of the USA have now caused the biggest financial crisis since the Great Depression and the nastiest economic crisis in decades. So let them be shamed in public for their hypocrisy and zealotry that has caused so much financial and economic damage.
Statement of Congressman Ron Paul
Financial Services Hearing on Sovereign Wealth Funds
DIMP Subcommittee
September 10, 2008
Mr. Chairman, once again we confront the issue of sovereign wealth funds, an issue which has become quite important due to the large amount of dollars and dollar-denominated bonds held by foreign governments, and the fears of these governments given the dollar’s precipitous decline over the past few years. The past few days have been quite interesting, with speculation that one of the reasons for the government takeover of Fannie Mae and Freddie Mac was the more than $1 trillion in Fannie and Freddie debt held by foreign governments. The threat of default on this debt would have undoubtedly had massive repercussions on the value of the dollar and might have unleashed the “nuclear threat” of a massive international sell-off of government and agency debt.
The United States government now finds itself between a rock and a hard place. The massive amounts of debt that we have allowed to accumulate are hanging over us like Damocles’ sword. Foreign governments such as Russia and China hold large amounts of government and agency bonds, and there are fears that as our creditors they will exert leverage over us. At the same time, as the dollar weakens, the desire to sell bonds and purchase better performing assets increases, leading to fears from others that foreign governments will attempt to purchase American national champion companies, or invest in strategic industries to gain sensitive technologies.
In either case, most politicians overlook the fact that we are in this situation because of our loose monetary and fiscal policy. Actions that would stifle the operations of foreign sovereign wealth funds would likely result in corresponding retaliatory actions by foreign countries against American pension funds and could have the same detrimental effects on the economy as the trade wars begun after passage of the Smoot-Hawley tariff. Rather than limiting or prohibiting investment by sovereign wealth funds, we should be concerned with striking at the root of the problem and addressing inflationary monetary and fiscal policy.
Debtors cannot continue building debts forever, and we now face strong indications that our creditors are eager to begin collecting what is owed them. It is not too late to correct our mistakes, but we must act now and cannot dally. We must drastically reduce government spending, end wasteful and disastrous interventions into financial markets, and rein in the Federal Reserve’s inflationary monetary policy. Failing to do so will ensure a descent into financial catastrophe.
“you bought more LEH— with the courage and fury of a mountain lion trapped inside a gay club, located near the outskirts of San Fransisco.”
That kind of writing will get you a Pulitzer.
No offense taken, anyone buying those stocks doesn’t understand technical analysis, they are in clear downtrends and remain “guilty until proven innocent”. What about all the fundamental clowns buying these stocks because the PE is just… or the dividend represents a good value, or buying because the CEO said everything is OK? No analysis form is perfect, but only price pays and that is where my analysis will always get the most weight. Any approach to the market can be a profitable one if risk is managed carefully, it is up to each individual to find the approach which works best for their individual situation.