Many of you ball lickers are not familiar with my resume. Some of you are and still believe “The Fly” will eventually be wrong. Others are like “WTF, this man is a space alien magician; God forbid I bet against him.”
What you need to understand, and listen to me very carefully: you are not in my league, pal. You are over there, sipping on that bullshit aluminum can filled with Brisk Iced-T, trading in and out of 500 share lots. Pffffffffffffffffffff.
Do not compare yourself to “The Fly,” at anytime, in any venue.
“The Fly” is so much more superior to you, when he pisses, it hits your ceiling.
All of my moves today were executed flawlessly, with exception to an early FAS purchase.
All of my SRS, EEV, DUG purchases were Godly.
All of my UYM, PFG and FAS sales were pristine.
And there you are, yet again, betting against me, as if you know shit from moonshine about this here market.
Remember, if you are having a good day in the market, trading against me, I’m just handicapping your spasticly retarded brain, so that I can take your funds at a later date.
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Fly is god
fly is the man and i never bet against him…
Thursday, January 22:
Bag of Moonshine (n.)— Illusion; nonsense. — G.F. Northall’s Warwickshire Word-Book, 1896.
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AXP responding favorably after their earnings.
The ability to spew so much vile and vitriol in a condensed space is truly world class.
However, there is only one man on the planet with that special gift. Much to your chagrin, we now know your true identity.
You, sir, are obviously Keith Olberman.
Shhh.
Thain interview. This makes for good comedy.
Okay, which one of you carpet-knights keyed The Fly’s minivan and put him in this panshard?
I’d say I pushed a few of the the Fly’s buttons today.
He who must pat himself on the back leads nobody.
who tells you such lies?
TXN Texas Instruments sees Q1 $($0.11)-0.03 vs $0.04 First Call consensus; sees revs $1.62-2.12 bln vs $2.10 bln First Call consensus
Yet, TXN is up a buck. Wacky market.
Thought the saying was “shit from shinola”, no?
Texas Instruments-TXN announces workforce reduction of 12%
I lost track of all the layoffs announced today. Have we lost a million jobs on the day yet?
Does Thain and Pelosi use the same Doc for Botox injections?
I get my lies straight from Maria Bartiromo, just like everybody else.
Master Fly, real men pee sitting down.
http://www.maniacworld.com/Why-Men-Should-Pee-Sitting-Down.html
yep. Maria is definitely blowing Thain.
WLL surprise offering getting the homo-hammer ah ….
The fellacious way Barti mouthed Thain’s press release makes me think that her husband’s daddy was a big Madoff investor.
Trouble at home, Maria?
Cubs —
“Do you crap standing up?” — funny and rhetorically logical.
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Can someone post a link for the Thain interview, if one exists?
mdawsz: http://release.theplatform.com/content.select?pid=VQQZfcWwIA1rR_KQNYlewaI_P4aR9Pyz&[email protected]&key=/j668MleSdixfsEkYysWq/i3LLk%3D&reporting=part=TOS|parttype=VOD|partcode=40642
S&P reports negative rating actions taken on 14 oil and gas exploration and production companies after industry review
S&P took several rating actions on oil and gas exploration and production companies after an industry review. Key factors behind these rating actions were liquidity and financial performance concerns for 2009. Quicksilver Resources (KWK) to ‘B+/Negative/–‘from ‘BB-/Stable/–‘; Swift Energy (SFY) to ‘B+/Negative/–‘from ‘BB-/Stable/–‘; Stone Energy (SGY) to ‘B/Stable/–‘from ‘B+/Stable/–‘; Energy Partners to ‘B-/Negative/–‘from ‘B/Negative/–‘; PetroQuest Energy (PQ) to ‘B-/Negative/–‘from ‘B/Stable/–‘; Dune Energy (DNE) to ‘CCC+/Negative/–‘from ‘B-/Negative/– ; Cimarex Energy (XEC) to ‘BB/Negative/–‘from ‘BB/Stable/–‘; Whiting Petroleum (WLL) to ‘BB-/Negative/–‘from ‘BB-/Stable/–‘; EXCO Resources (XCO) to ‘B/Negative/–‘from ‘B/Stable/–‘; Clayton Williams Energy (CWEI) to ‘B/Negative/–‘from ‘B/Stable/–‘; Parallel Petroleum (PLLL) to ‘B/Negative/–‘from ‘B/Stable/–‘; Range Resources (RRC) to ‘BB/Stable/–‘from ‘BB/Positive/–‘; Petroleum Development (PETD) to ‘B/Stable/–‘from ‘B/Positive/–‘
How long before Kudlow uses the D word?
Where Will the Jobs Come From?
There’s a lot to cover and I’ll try to do it as succinctly as possible. Obviously, last week saw plenty of bombs: further-imploding stock prices at major financial institutions; ugly earnings reports; and the announcement of layoffs from all quarters, which will be an enormous problem throughout the year. However, despite the market being under intense pressure all week, it refused to “break.” Case in point: Friday, when the preopening futures were indicating a decline of about 3%, apparently due to GE’s results. Even though GE was splattered for about 15%, over the course of the day the market managed to trade higher.
GE Fans –Given to Fawning, Not Probing
What I still find fascinating, after all the financial chaos we have endured, is the pretense that GE is somehow still a triple-A company. As my friend and knowledgeable market observer Joanie points out: GE’s stated equity of around $105 billion — less Buffett’s $3 billion in preferred shares and $97 billion of goodwill and intangibles — leaves GE with about $5 billion of tangible common equity, against which it has tangible assets of about $700 billion. Meaning, as she notes, that GE is leveraged to the tune of 140 to 1. Obviously, that’s a back-of-the-envelope calculation. But again, it does demonstrate the absurdity of GE’s triple-A rating.
And, there’s no shortage of other market dichotomies these days — my favorite from last week being IBM and Microsoft. Although IBM reported that its revenues were less than expected, through the magic of “financial management” (engineering?) it produced earnings that were better than expected. Contrast that to Microsoft, which also reported revenues that were less than expected — but an earnings shortfall as well. The company saw its stock drop about 15% last week, while IBM rallied a similar amount.
Microsoft trades at around 9 times earnings (more, or potentially less); yields about 3% (which is more than you can get from a 20-year government bond); and last quarter it reduced about $600 million in operating expenses.
Microsoft is a leader in its field, being one of the better companies in America. It has huge gross margins and a rock-solid balance sheet, as well as a decent barrier to entry. In sum, MSFT seems quite attractive at this price. (I bought some Friday, though I’m not sure how long I’ll keep it.)
On the other hand, IBM — which appears to sell at 10 times earnings — has a weak balance sheet, and I for one don’t trust the accounting, nor can I tell you how the company is really making its money.
So, to see IBM rewarded and MSFT penalized was absurd, as apparent glad tidings were being chased while an objectively cheap asset was being dissed. It was even more bizarre to witness IBM being pursued while financial stocks were melting down, given that these companies are IBM’s big customers.
As for the problem-creating financial stocks, Jim Bianco points out that if the remaining financials in the Dow were priced at zero, it would only lose another 300 points. So, they are rapidly running out of room to take the market lower. But to the important multimillion-dollar question: Are these stocks sinking because there really is no value for the equity shareholder, or because the institutions are going to collapse? I happen to think the answer is the former, not the latter — and that may be part of the reason why last week the market bent but did not break.
A new trend that appears to be developing, which I’m happy to see and hope gains momentum, is that some larger companies are no longer giving quarterly earnings guidance — i.e., Intel, Union Pacific, Microsoft, and GE. I’ve always thought that the game of beat-the-number was stupid, and that those companies which routinely “won” at it were liable to be involved in managing their earnings. (Think of GE as the perfect example — or any financial, for that matter.) So, to the extent that businesses are looked at as businesses and not vehicles with which to “beat the number,” that is a positive development.
Turning to today’s market action: Overnight stock-index futures were initially weaker, but higher in the early going. The market opened 1% higher and milled around. Then the morning macro data was released — with the leading economic indicators shown to have increased by 0.3% (vs. expectations of a 0.2% decline); and existing-home sales having increased 6.5% month-to-month ( rather than declining 2%). I think the LEI data was more significant, as in its wake the market immediately raced ahead. A couple hours into the day, the S&P and Nasdaq were higher by about 2%, with the Dow a laggard.
However, the morning highs did not last long, as the market started to leak — such that by early afternoon, all of the gains had evaporated and the indices were back to unchanged. The last 90 minutes saw an attempt to grind higher, but that too fizzled, as the market closed with the Dow/S&P higher by 0.5% and the Nasdaq about twice that.
A Rally-Friendly Backdrop
A large chunk of earnings season is behind us and we’re heading towards the no-news period — when folks can fantasize and hope that business is getting better. Also during this period, we will see the government’s stimulus plans. Of course, the Fed will be working 24/7 to stimulate as best it can as well.
So, I think there’s a chance that the market might rally and that 800 on the S&P and 8000 on the Dow will be the lows for a while (although there’s always the potential for tape bombs, such as next Friday’s employment report — which could be brutal). If the market is able to rally (if the economic news stops getting worse, even briefly), at some point folks will get their hopes up again. As those hopes are dashed, we could see dramatic weakness once again, but I think that’s getting way ahead of the process.
Away from stocks, the dollar was weak — as was fixed income (after having been sort of under pressure last week). It is entirely possible that the bond market may finally have seen its highs.
More importantly, at least to me, gold broke out last week, as did many gold stocks. While away, I added to my gold positions (stocks, not bullion). I’d been on red-alert looking for a test of the highs of the “range” (as I noted in my last Rap on Jan 6). What appeared to be part of the catalyst for the strong action last week was the news (midweek) that the Swiss National Bank was joining the U.K., the USA and Japan in quantitative easing. Each week, it becomes even more obvious that the world’s central banks will print whatever is required to attempt to stanch the bleeding from the business collapse that’s under way.
Also, a wildcard was added to the mix last week when Tim Geithner accused the Chinese of manipulating the yuan. It’s a completely idiotic move on the part of the administration to get in the face of the Chinese when we’re going to be borrowing so much money, but nevertheless the administration did that. In any case, gold was obviously quite strong last week, as were gold stocks. Early on this morning, gold was higher by 2%, as was silver. Gold stocks were also higher, but they all reversed and closed lower. Gold itself closed 1% higher, as did silver.
Lastly, oil was flat. Perhaps it too has made its low for a while. Certainly, many oil stocks have sprinted higher in the last few days.
Positions in stocks mentioned: LONG MSFT.
The Fly is God.
Nice call FLY…you da man.
BTW- I know you liked the action in the EU (UK) banks today. However, I think HBC will go the way of Bear Sterns.
Thoughts.
Thank you for the advertisement Fly!
Throughout the years, our rating system has always been following draconian internal controls and procedures to ensure the highest integrity of our ratings. We have our best people at the job guarding the integrity of our ratings.
Cheers Juice 😉
thaks for the link
also here: http://www.cnbc.com/id/15840232?video=1013593036
The Guy is Flod
FLy,
do you have a short term target for SRS?
Notice how the chick on Fast Money was MIA today. I believe Karen said to buy ROH all the way up until last Friday (closing price Fri: 65.82). Today we’re down over 13% on ROH. Nice call, Karen. These Fast Money guys are on a roll.
Cubs – thx 4 the Larry David clip … love that show 😀
Citigroup Jet Purchase: $50 Million, 12-Seat Plane Despite $45 Billion Bailout
E-Trade Baby found dead (suicide suspected):
http://www.celebjihad.com/celeb-jihad/e-trade-baby-found-dead-in-apparent-suicide
Mauldin had a good letter about the Dow Index Shenanigans going on currently. It’s unlikely that the index will go much lower unless some of the high-dollar stocks get pummeled. C, AA, and many others have done all the damage they can do. They’re blatantly gaming the index here.
From Mauldin:
“Citi (C) = $2.80
GM (GM) = $3.50
B of A (BAC) = $5.10
Alcoa (AA) = $8.35
“If all four of these stocks went to zero on today’s open, the DJIA would lose only 157.3 points.
“The financials in the DJIA are …
Citi (C) = $2.80
B of A (BAC) = $5.10
Amex (AXP) = 15.60
JP Morgan (JPM) = $18.09
“If every financial stock in the DJIA went to zero on today’s open, it would only lose 331.25 points, less than it lost yesterday (332.13 points).
“If you want to add GE into the financial sector, a debatable proposition, then: GE (GE) = $12.93
“If the four financial stocks above and GE opened at zero today, the DJIA would only lose 434.24 points.”
“So what is driving the index? The highest-priced stocks:
IBM (IBM) = $81.98
Exxon (XOM) = $76.29
Chevron (CHV) = $68.31
P&G (PG) = $57.34
McDonalds (MCD) = $57.07
J&J (JNJ) = $56.75
3M (MMM) = $53.92
Wal-Mart (WMT) = $50.56
“For instance, if all the sub-$10 stocks listed above, all the financials listed above, and GE opened at zero, the DJIA loses 528.63 points. To repeat if C, BAC, GM, AA, JPM, AXP and GE all open at zero, the DJIA loses 528.63 points.
“If IBM opens at zero, it loses 652.95 points [IBM has risen since then – JM]. So, the DJIA says that IBM has more influence on the index than all the financials, autos, GE, and Alcoa combined.”
Link for the whole story:
http://www.investorsinsight.com/blogs/thoughts_from_the_frontline/archive/2009/01/24/here-comes-tarp-3-and-4.aspx
imagine if Fidelity was public – their books must be just as bad as the rest….
I have been betting against you and winning. XOM, just to name a few.
First winning day in five for da Fly apparently
Startling recently unearthed footage!
The Fly, “interrupted” in his revenue collecting activities by recently appearing heckle-douche shamocrat, “The Fly Swatter.”
Things don’t go so well for FS, and there’s a lesson to be learned by all you nine millimeter pooh-poohers, too.
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+27 in 2007
+60% in 2008
so far, up 11+ in 2009.
STFU.
Off to dinner.
Shhhh…the Messiah speaks…..
Jake,
Dennis Farina is a great guy. It’s funny when he plays a heavy because he was a cop before he was an actor. Lives in Scottsdale most of the year to play golf.
Anton,
I’m assuming you know him. He’s one my favorite character actors. If you ever have dealings with GE Capital out of Chicago, he has a clone walking around up there. Hangs in all the best mob restaurants, too. Great guy.
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the fly adapts quicky
your resume is obvious
Dennis Farina was great in one of my favorite films–Midnight Run. If you haven’t seen it, it’s a must see. DeNiro, Grodin, Farina, Joey Pants, John Ashton.
Blackberry test. Buy stocks. Go broncos.
Looks like I didn’t regret moving off the sidelines and going long on some horrificly battered Banks last friday morning. We’ll see if I regret it over the next few days.
Didn’t the Broncos just hire the E-trade baby to coach their team?
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Here is a link to some of the E-Trade baby Super Bowl outakes that won’t make it to the game.
https://us.etrade.com/e/t/jumppage/viewjumppage?PageName=etrade_super_tv_ads
Too bad about the suicide.
I’ll say again, watch housing data; We are now only a couple more reports away from the market deciding that housing has bottomed and, thus, other markets will have bottomed as well. It WILL change sentiment, and it WILL trump jobs. In the next 30-40 days, CaseSchiller will show bottoming out of price declines because of recent sales pickup. Today’s existing homes showed a huge inventory drop on still-weak sales – that’s key. Inventories have clearly topped. Upcoming new home sales will confirm: an uptick in sales with multi-decade lows in construction. Transaction rates change (both up and down) much faster than building activity; that’s why real-estate cycles tend to have V-shaped bottoms. You’ll be looking at one soon.
Please note Fed strategy, through purchases of MBS and treasuries, will be to force a sales rebound by suppressing rates. They will not let their thumb up until home prices have actually significantly rebounded. Why? It’s the cheapest way to restore capital to the banks, via MBS security repricing.
Supply overhang? In your dreams. It will vaporize at the first hint of a price inflection faster than Merlin can say “poof”. Every seller who’s still alive will be thankful, pissed, and motivated to wait. ADBs in the housing market will rule, both the individual and institutional types.
It’ll even make XOM go up. More. 😉
Housing has V-shaped bottoms? You clearly haven’t been in a housing bubble, have you?
When bubbles burst in housing prices, it takes years to recover. There are LOTS of owners right now who would sell their property at the first hint of a price jump. Supply is low because prices are low and falling (can’t compete with foreclosures). You can keep dreaming about that V-shaped recovery.
All I can say is about the market bottom and real estate is that I totally maxed out my 401K purchases of utilities and real estate sectors for the last six months so I think I’ve been stockpiling bargains for the long term. I’ll look at it again in a couple years.
“”I totally maxed out my 401K purchases of utilities and real estate sectors for the last six months “”
well, that sucks…what other view could you have after that besides the long view? LOL
The long view is all I have had as far as the 401K goes. I’ve got another fifteen years to watch that so I am very pleased to be purchasing during this time of trouble.
Jake,
You better get your tickets to Detroit.
Lullville looking tough. Big East is a Monster!
Peezy… Can’t believe Washington beat UCLA, I stayed up and watched them squeak by USC…that team would give me high BP.
Thought I would repost this in light of the statements made by Thain today –
(Reuters) – Merrill Lynch & Co Inc said on Monday it would raise $8.5 billion by selling new stock. But CEO John Thain has consistently denied that the investment bank would need to raise more capital. Here is a selection of comments by Thain or about his views since the end of last year:
“One of my first priorities at Merrill Lynch was to strengthen the firm’s balance sheet, and today we have made great progress towards that by bolstering our capital position through these investments and our announced sale of Merrill Lynch Capital.” (December 24, 2007 — Thain in a statement when Merrill announced a $6.2 billion capital raising)
“…These transactions make certain that Merrill is well-capitalized.” (January 15, 2008 — Thain in a statement after selling $6.6 billion of preferred shares to a group that included Japanese and Kuwaiti investors)
“We’re very confident that we have the capital base now that we need to go forward in 2008.” (January 18, 2008 — Thain as quoted by the New York Times).
“…Today I can say that we will not need additional funds. These problems are behind us. We will not return to the market.” (March 8, 2008 — Thain in an interview with France’s Le Figaro newspaper)
“We have more capital than we need, so we can say to the market that we don’t need more injections. We can confirm that we have tackled the problem.” (March 16, 2008 — Thain in an interview with Spain’s El Pais newspaper)
“In 2007, we lost 8.6 billion dollars after tax, but we raised 12.8 billion dollars in new capital. We raised significantly more capital than we lost. And we did that on purpose so that we could say to the marketplace that we raised more than enough capital. We replaced all the capital we lost. We have plenty of capital going forward, and we don’t need to come back into the equity market. The goal is to maintain our current ratings. No more capital raising; I’m sure we have enough capital.” (April 4, 2008 — Thain in an interview with Japan’s Nihon Keizai Shimbun)
“We deliberately raised more capital than we lost last year … we believe that will allow us to not have to go back to the equity market in the foreseeable future.” (April 8, 2008 — Thain to reporters in Tokyo, as reported by Reuters)
“John Thain has been very clear that we have sufficient capital and don’t have a need to raise additional common equity for the foreseeable future. When we raised this capital in January, we had a lot of demand so we went beyond what we needed.” (May 12, 2008 — Merrill President Greg Fleming in an interview with the Times of London)
“Today on a pro forma basis we have about $44 billion of equity capital, which actually isn’t very much below the all-time high that Merrill ever had. And our philosophy about this is that we are well-capitalized. We’re comfortable with our capital position. We, like everyone else, are deleveraging our balance sheet.” (June 11, 2008 — Thain on a conference call hosted by Deutsche Bank)
“Right now we believe that we are in a very comfortable spot in terms of our capital.” (July 17, 2008 — Thain on a conference call after posting Merrill’s second-quarter results)
(Reporting by Martin Howell; editing by Braden Reddall)
With my 401K, I didn’t have the buying power of Mr. Buffet when he picked up CEG last Nov at fire sale prices with an egregious dividend contract and a purchase agreement at 23/share at a later date if he so chooses. But, since the utilities I’ve been buying over the last six months involve dividends that are reinvested in stock purchases, the stuff grows over time and are in companies that have been around for over a hundred years. As far as the real estate thing goes, I’m picking up fire sale prices on that stuff, no doubt.
My mad money trading was sidelined in Mid december after 76% gains in 2008, mainly made by picking up banks during the short squeezes last year. I’m doing it again starting last friday.
Ok, you own me when it comes to trading. So throw me a bone, help me be a better trader. Not your job, true but help us litlle guys too.
Please don’t make me pay Timmy for help.
Hey Guys & Gals, I got home a couple of hours ago and just finished reviewing the market. Looks like we will be DOWN tomorrow as a pivot day and go down to break below S&P 800.
BTW, I doubt the jerks at cnbc alerted anyone that the $DJT had it’s LOWEST CLOSE of the year today. Obviously, that is a great tell for the bulls. You also might want to take notice of the 3 month libor over the past 3 weeks as it has been going UP. See you all tomorrow!
D Dog speaks the truth. Listen to him.
BTW, I doubt the jerks at cnbc alerted anyone that the $DJT had it’s LOWEST CLOSE of the year today.
Hmmmm… could a Dow Theory non-confirm be as important a signal as a confirmation?
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Out of the 269 trading days between Jan 08, 2008 and today there was a 50% chance of a day being lower than the previous day.
Oh yeah, DD – that was with a .5 Standard deviation so you’re coin flipping calls signify nada.
On the other hand
If the SPY aims to close @ less than 83.2 tomorrow then there will be a buy signal for the 357MA-SPY which is trading down at -2% YTD.
2008, the 357MA was up 28.84%