Coffee versus Gold

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Any questions?

Today was a pivotal day for the markets. We could have folded up tent and tanked, but we didn’t. Despite gold receiving the “homo-hammer” for most of the day, the markets rallied back and took what’s rightfully theirs: bearshitter capital.

Gold, oil and other commodities will trade up from here and Green Mountain Coffee Roasters Inc. [[GMCR]] will punch the cocks off of those who bet against it. Do not make the childish assumption that your charts foretell anything. Using charts to buy stocks is equal to watering the lawn when it snows.

For the day, “The Fly”enjoyed modest gains; but he is setting up for something far more perverse. He’s been buying Chinese stocks, like [[YONG]] , China Digital TV Holding Co., Ltd. [[STV]] and [[HEAT]] , with the hopes of malfunctioning tradebots running wild, slapping the tits off of you sloppy short selling salad makers.

Into this new leg up, I am emphatically bullish on Chinese, Tech and Energy related stocks, with a heavy emphasis on names with large short positions. And, don’t forget, I like names like W.W. Grainger, Inc. [[GWW]] for “$100 roll prospects.”

I bought 10,000 [[HEAT]] @ $15.

Disclaimer: If you buy HEAT because of this post, on the coldest winter night of 2009, your furnace will break down. And, you may lose money.

Several weeks ago, Shanghai changed its building code to include more wood, in order to build cheaper housing. China intends to spend up to 132 billion on affordable housing, as the great communist experiment in China creates vast diversity between the haves and have nots. Needless to say, lumber stocks have responded with higher prices.

I’m not a big fan of lumber stocks. Personally, I am more of a pulp guy, which is why I was long FBR. However, there is something to be said about China and their burgeoning economic power. While we laugh at China’s grandiose plans for world domination, they are actually laying the ground work to control the world, economically. This is what happens to an old superpower who gets fat and lazy, drunk and stupid. You get displaced.

Today’s market has an annoying feel to it. No one wants to commit, yet here we are wasting each others time. Oil is getting “ape raped,” once again and banks are weak. The Dow is unchanged, yet I have several stocks down 3%+.

One notable mover is Research In Motion Limited (USA) [[RIMM]] . I have to believe, RIMM is nothing more than one good phone design from a BROKEN ROBOT breakout to the upside. The stock is cheap as Chinese drywall, in the low $60’s.

In short, do not underestimate your Chinese Overlords, for they will soon be whipping you at your local Li Fung prison factory. And, before committing new capital to this market, you might want to make sure both gold and oil firm up.

Let’s all take a moment of silence to pray for severe blizzard conditions, which will help out the good folks who store natural gas. God knows, the natural gas drillers need some sort of cataclysmic event, in order to “clean out” their fucking inventory. The problem with natural gas: there is simply too much of the shit. We need to liquefy it, then lose it to some rogue pirates headquartered in the middle east.

While the shorts continue to conduct themselves like garbage men (no offense to police officers) smoking cigarettes with the windows up, “The Fly” will be looking to bank some coin in natty. Why the fuck not?

My fav’s are SandRidge Energy Inc. [[SD]] , GMX Resources Inc. [[GMXR]] , Apache Corporation [[APA]] , Southwestern Energy Company [[SWN]] , ATP Oil & Gas Corporation [[ATPG]] , Chesapeake Energy Corporation [[CHK]] , Continental Resources, Inc. [[CLR]] , Arena Resources, Inc. [[ARD]] and Weatherford International Ltd. [[WFT]] .

Extreme dice rolls include Flotek Industries, Inc. [[FTK]] , NGAS Resources, Inc. [[NGAS]] and GeoGlobal Resources Inc. [[GGR]] .

Okay, you can now go back to your regularly scheduled monotonous life. Try not to watch CNBC too much. I hear that shit can give you cancer of the eyeballs.

Hide the kids. Starve the dog.

Developing…

Off to eat a coffee mug.

Top picks: Green Mountain Coffee Roasters Inc. [[GMCR]] , [[YONG]] and China Digital TV Holding Co., Ltd. [[STV]]

No offense to Jakegint, but gold is for 2nd class morons. The type of people who buy gold call themselves “bugs” and stockpile food, waiting for the end of civilization. In their heads, they imagine a world, not too much different from the Lord of the Rings, where the Federal Reserve are evil monsters trying to feast on the flesh of the righteous humans. These miscreants make stupid videos and talk all day long about fiat currency and how China is going to stop buying our fucking bonds.

Well, I got news for the Peter Schiff crowd: that shit will NEVER happen, at least in your lifetime—unless of course the Chinese are into afflicting grave depression upon their populace, which in turn will lead to an armed revolution.

Ladies and idiots, America has the world by the short hairs. As a result, buy the dips, sell the rips.

The banking crisis has been put on hold, for at least another 3 years. So, you might as well get used to not running out of food or the dollar going “Zimbabwe.”

In short, gold has been going up due to asset allocation. Money managers and sovereign wealth funds have been buying the yellow metal, mainly because of the idea that it is an alternative to paper money. However, in reality, the only viable purpose a gold brick would serve during a financial collapse would be to bash in your neighbors skull for stealing your crops.

Some of you are short gold, via [[DZZ]] or [[DGZ]] . I can’t get into that sort of thing now. Stocks, bonds and commodities are irrational these days. In my opinion, it makes little sense to get in front of the “Gold Bug Express.” However, just know, it is filled with idiots.

I sold out of [[UYG]] , National-Oilwell Varco, Inc. [[NOV]] , The St. Joe Company [[JOE]] and The Clorox Company [[CLX]] , all of which were long term positions.

With a portion of the cash, I bought 5,000 Green Mountain Coffee Roasters Inc. [[GMCR]] @ $63.

Long live “The Fly” and his fucking Keurig coffee machine.

With Green Mountain Coffee Roasters Inc. [[GMCR]] winning “The Coffee Wars,” defeating [[PEET]] by acquiring [[DDRX]] , GMCR will now own and control 85% of the K-cup market. Do you understand how significant this is, fuck-ball? They go from making .06 a cup to .12. Chew on that, while you marinate in your fucking GMCR short.

The market is taking a bit of a breather today; but for the most part, my stocks are up. From [[YONG]] to Green Mountain Coffee Roasters Inc. [[GMCR]] to CGG Veritas (ADR) [[CGV]] to Sociedad Quimica y Minera (ADR) [[SQM]] to Equinix, Inc. [[EQIX]] , I am up.

However, certain sectors are getting punched. If you are at all interested in positioning into foreign names, POSCO (ADR) [[PKX]] , Mechel OAO (ADR) [[MTL]] and Vimpel-Communications (ADR) [[VIP]] would be at the top of your watchlists, right now. From my vantage point, the market is setting up for a terrific “Santa Claus Rally,” whereby “Santa Fly” will make mounds of coin.

To the watchlist, fuckface!

I like China Digital TV Holding Co., Ltd. [[STV]] , [[HEAT]] and SandRidge Energy Inc. [[SD]] , right here, right now.