…is not in my office today. Instead, I am filled with regrets and quick flashes of rage, in between snacks of course. There was no reason to hold Flotek Industries, Inc. [[FTK]] —but I did. I mean, it goes against all of my rules and silly little mantras, holding a stock with poor fundies and in a downtrend, while in a bull run, is more than stupid: it’s downright gay. The premise or thesis behind the trade idea was valid: go long a commodity related stock with financing issues, in the midst of a commodity and credit recovery. It made perfect sense. The stock even had a big short position to boot, which could be used as tinder, at a later date.
However, it did not work out, as some stocks/companies are bound to fail or just mess things up. It was a bet worth taking, considering when it was done (8 months ago) and why (reflation). To be honest, it takes great skill to pick such a loser in this market. For this gift of “loserdom,” I am eternally grateful.
No matter how many times I get hit with losses, they always sting. The gut wrenching feel in my stomach makes me want to punch somebody’s face off. At any rate, it doesn’t serve any purpose crying over an empty milk carton. What to do now?
Well, first of all, I do not believe the company is going out of business, just yet. Once they get another waiver from their creditors (weeks), they will have enough cash to survive another year. Add to that, the burn rate does not take into account the remote possibility of revenue growth. What the company needs, desperately, is for natural gas prices to rise above $5, in order to revive U.S. natural gas drilling operations. If that happens, in my opinion, the stock can recover, big time. If not, unfortunately, it will go by the wayside.
Aside from that, I am focusing on other ideas, like Ciena Corporation [[CIEN]] , W.W. Grainger, Inc. [[GWW]] , Bio-Rad Laboratories, Inc. [[BIO]] and U.S. Global Investors, Inc. [[GROW]] .
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Who’s buying FTK on the dip.
I am buying. SSSSSSHHHHHHH. I need the scrap iron for my railroad tracks.
Apparently, only me. It is scary when orders get filled that fast.
Excellent post
Good lessons. Lackeys-make your own trades.
At least it wasn’t ARWR
I am no stranger to pain and regret either.
The sun will rise tomorrow and God willing we will still be living.
Now… what to do. That is the forward moving, positive outlook question at hand.
So The Fly doesn’t always win?!?!
No. He’s not really a god. Maybe a demigod.
Le Fly wins even when it looks like he’s not winning.
No need to worry, housing is on the rebound and the housing crisis is over. Right Fly? Isn’t that what you and Cramer agreed on. Maybe it is slowing but it is not over by any means. just a slower grind down
http://finance.yahoo.com/news/Mortgage-delinquencies-hit-apf-3335040402.html?x=0&sec=topStories&pos=1&asset=&ccode=
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A week ago Friday, the President signed a bill extending that tax credit well into next year and expanding it to first-time buyers with higher incomes as well as to existing homeowners, with a $6,500 limit. National Association of Realtors chief economist Lawrence Yun feels “rising sales from the expanded tax credit should stabilize home prices by next spring.”
The tax credit is not going to do shit as unemployment continues it move up to 13% (yes that’s where its heading IMO).
People will still not be able to afford houses at the “stabilzed prices”. Of course Lawrence Yun is an optimist, he gets paid to be one
Well, seeing as your predictions have been so spot on as of late, you’ve changed my mind.
The way you are able see the future is truely (sic) a gift.
“Finally, the NAR’s report on home prices said most U.S. cities saw gains in the median price of single-family homes for Q3–the second quarter in a row of price gains. Prices were still down from Q3 a year ago, but the pace of the decline has been slowing. Many experts feel the shrinking supply of unsold homes suggests the housing market is edging closer to price stabilization. Even foreclosure fillings fell in October for the third straight month.”
“Many experts” oh you mean the same people that where saying to buy real estate in 2005 and 2006.
Foreclosures will rise again.
Look the housing crisis is not going to be permitted to rematerialize. That would utterly shatter any remaining confidence in the federal government and corporate sector. Even if they have to inflate this bitch to Dow 20,000, and flush all of the risk out of the market into other sectors of the economy, in a brilliant charade, the housing crisis will not resume, and it will be publicly acknowledged that whatever problem replaces it will be of its own origins and making.
You all need to stop betting against real estate. You don’t have to bet on it. But if you keep thinking that any public official will seriously gamble all of their clout on allowing destruction to return to that sector, you’re gonna end up broke in an alley.
Ha Ha Ha Ha!
What do you mean resume? It is not over. Ask all the people in tents in Sacramento. Drive down a suburban street in Vegas.
Where is all the money going to come from bank lending has now declined for 21 weeks in a row and over this entire time frame, a total of $216 billion (15% at an annual rate) of loans and leases have vanished.
Fannie Mae? Freddie Mac? What a joke. Even the FHA is seeing pain? There is still a lot of strecthed home owners with prime mortgages that will be seeing deliquency soon. There are still a lot of ARM’s out there that were originated in 2005 and 2006, 5/1 arms with high margin rates and a bunch of interest only loans too. In fact Wells fargo is modifying loans and placing the borrowers back into an interest only loan so that they can “afford the payment” Yeah right. Keep beieving the shit you here on TV and out of Washington and you’ll end up broke in the alley my friend
Yes, I actually agree with your assessment of the condition of the average home owner, I’m fully aware that there are a vast number of destructive securities in existence, and I completely believe that we are going to feel much more pain. In fact, I’ve already predicted an increase in bankruptcy filing over in the KoPG, at the start of the new year. But saying house owners are going under and saying that will translate to the market are two very different things.
My question to you is not whether we will suffer for these mistakes. Rather, I’m asking you, how will we suffer? If you didn’t notice, banks balance sheets have cleaned up quite a bit in the last year. Is it just an illusion, or have government programs and some nifty legislation on any one of the unread thousands that have passed through our Congress perhaps absorb some of that risk?
We are still very much in a crisis. But bear in mind, not all crises are the same. Sometimes appreciation is a crisis in and of itself, when it occurs without corresponding creation of wealth. And it is very likely a currency crisis which we have transgressed into. No one should be betting against financials, banks, and REITs as if when the Fed kids back on the rates, these things will immediately go to zero; as if their various failing debtors, clients, and tenants hold ultimate sway on their fates anymore.
While the men behind these latest years are not brilliant, they’re also not complete idiots.
You’re right they are not idiots at all. The are the most brilliant hucksters and criminals of all time. They still from people to feed their never ending greed and the sheeple simply believe everything they say. Do you really think that the world would have ended if the TARP would not have passed
No. Only that new people would have been in charge and many others would have lost homes and possessions they never should have had.
However, if I’m going to bet on a horse, I’d much rather bet on the horse that’s going to win.
This is a good discussion exchange, thanks for posting TMoe, DMG and Cain
BIO just broke par
God willing, we will see 10,500 today and Fly can say what he really thinks of the fine gentlemen over at Flotek.
Heebner called the crash and played it well. Maybe he stayed bearish too long.
R.I.P. FTK Lets all say good buy to our fallen friend for allas we new him well . Our deepest sympathy goes out to the family , friends, and BUGS . I am sure you know who you are . Amen
You missed your chance to buy the Silverdome (plus 130 acres) for about $583,000.
Could have named it FlyDome and had tractor pulls and Rolling Stones concerts.
Or just lease it out to Detroit area gangs for weekend shootouts.
http://www.freep.com/article/20091116/NEWS03/91116065/1318/Canadian-firm-submits-winning-bid-of-583000-for-Silverdome
Haha, I see that old building practically every day. Really, as crazy as it sounds, Detroit is coming along much nicer than what is perceived. I think the majority of violent criminals so ruined the local economy that they all must have starved to death. Or else they moved to Flint…
You live in the D, Cain?
Yes, I think you mentioned you do as well.
Loses can be recovered when you are the fly right?
“Loses?”
_____
Fly,
What makes you so confident FTK will get that waiver from its creditors? If I was a bank, why would I give this fucktard management more chances to run away with my money?
Spread the word – Geithner just announced that FTK is too big to fail.
I also heard that Warren Buffett and George Soros are buying up stock.
Feel free to spread the word.
Seem to be tipping into the green. However, if I’m not mistaken it looks like oil is in the process of disconnecting from the markets. Perhaps even rolling over. Anyone have thoughts?
a long term oil deal will fix the price. nuff said.
Tech, ag, and some financials are showing strength today. Euro futures are still holding their upward trendline and have been banging at the October highs, if it breaks lower then look for an oil down/euro down/dollar up move accordingly. Looks like $USD futures have found some support around $75, gold has touched an upper trendline and looks “exhausted.” 10yr treasuries also may break out now, located at the top of its range. The Ozzie dollar has just been going up without bounds but was down today off its highs yesterday.
I think that we could see a bit of a pullback now, although it feels some correlations are breaking down, as we approach inflection points; people may be re-allocating risk. One other thing I noticed was that LQD (Investment grade ETF) hit new highs today. JNK (junk bond ETF), and HYG (High yield ETF) both look to be bouncing off their recent tops. I think there is also a movement occurring from higher risk into investment grade securities, short term.
Crude has been trading in a range the past sessions and the Exxon CEO comments may have decoupled some correlation traders (all speculation on my part), but despite what the news and doomsayers blog, the market wants to go higher. Crude and natty are at record storage capacities (natty is like 3.7tcf versus 3.9tcf total capacity). Crude bull catalysts are Chinese econ data saying crude demand is increasing and OPEC doing their typical bullshit. I’ve noticed oil rig counts increasing over the past few weeks and this may make sense because of the contango. If they drill now and store or buy near month contracts while the far future contracts are at a premium it makes sense for the drillers to just store and sell the far month contracts.
Short term I like selling calls, avoiding the volatility of small cap stocks, moving into foreign medium to large cap, and remain bullish for equities.
What do you think?
I’ll post on my thoughts tonight.
I couldn’t get a borrow on RTH so I decided to pick up a few Jan 95 puts.
HPJ showing some vigor into the closing hour
picked another 10,00 of FTK for a total of 20k and 40k of DPTR. Feel like gambling today. if nothing else, they will help hedge my insanely large short positions.
why is the market not down today in the face of a large $ rally?
sold HPJ. taking more GROW!
LOSER. he he he.
I highly recommend this WSJ article to all of you.
http://online.wsj.com/article/SB10001424052748703811604574533680037778184.html?mod=WSJ_hpp_LEFTTopStories
I for one will not gloat at the FTK loss in hopes that Fly does not laugh at me when he sees that I picked DZZ at the beginning of the year in RC’s stock picking contest.
At least I can claim senility.
I see TK just bought TZA. This makes me very nervous, not because he is a bad trader but he just has had a shity run for months now! He is not in a positive vibrational match with the universe at this time!:)
Too many PO’s coming lately … how much can the market absorb?
DRYS, EMS and TEN announce after market close.