I Found the Money!

Concern over Federal deficits is rocking bonds, sending yields higher. [[TLT]] is getting smashed to the tune of a staggering 1.7%. Gold is NOT a safe investment, when it pertains to the “wall of worry.” Gold is a play on inflation, period. What we are seeing today is a seismic shift into dollars, as predicted. What I did not expect was the move up in yields. However, I am fairly confident today is an anomaly and should the market continue to weaken, funds will shift from cash to government debt.

Let me be clear: despite the tepid 45 point move to down downside (as of 3:00 et), there are some very troubling undercurrents with this tape, all stemming from the move up in the dollar.

On a lighter/sweeter note, [[SGG]] is up more than 5%. What an oddity.

In short, get ready for some downside “fuck you, you’re dead” action.

[[TLT]] is down a buck on PIMCO witchcraft. The stage is being set, ever so quietly, for a flight to quality, with Portugal getting downgraded by Bitch, the dollar ripping to the upside and stocks expensive as shit.

LOL. I’m just kidding. What was I thinking? You know damn well this market is sucking the helium balloons, produced by the trading robots at Goldman. There cannot be a pullback, especially before the April 15th tax deadline. Don’t be silly.

However, in the event stocks take a temporary pause, [[TLT]] will recover from today’s voodoo induced sell off and charge into the mid-90’s.

Separately, John Corzine, former Governor of NJ and President of the United States via CEO title at Goldman Sachs, is now CEO of MF Global Ltd. [[MF]] . Without a doubt, MF will receive some sort of oddball stock appreciation, thanks to the appointment. Keep an eye on that one, as well as CIT Group Inc. [[CIT]] .

Finally, Adobe Systems Incorporated [[ADBE]] smoked numbers, as they always do in March. I am not selling, especially since my long exposure is so limited. With my idle cash, for now, I will just sit here and stare at it, marveling at the prospect of receiving sub 1% money market rates. Life is pretty fucking boring right now, as far as my stock market life is concerned.

All citizens of the United States (including children over the age of 6) must smoke menthol cigarettes, else endure a 50% income tax penalty.

That is all.

So far, the market has advanced in 16 of the 18 trading days in March. The volume has been nothing short of pathetic, which incidentally is the best environment to jack prices higher. As prices move higher, the market advertises itself to the unwashed degenerate OTB guy. The end of this rally will be marked by speculation on a grand scale, within all of the lowest end names, like all listed Chinese companies.

If you must plow into the market, take a look at POSCO (ADR) [[PKX]] , Korean steel company, down at these levels. Also, play the short squeeze in SandRidge Energy Inc. [[SD]] , sub $8, ahead of the speculative money. The keyword for the market is “degenerate.” So, with that in mind, stocks like CIT Group Inc. [[CIT]] , Lloyds TSB Group plc (ADR) [[LYG]] and E TRADE Financial Corporation [[ETFC]] stand to do well in this environment.

Industrials stocks are “locked higher,” thanks to our Chinese overlords and their devoutness to all things material. From coal to iron ore, the Chinese want it and they want it now. Cummins Inc. [[CMI]] , Emerson Electric Co. [[EMR]] and Flowserve Corporation [[FLS]] will never trade down again.

In summary, this is so easy it’s scary.

NOTE: Going with the lottery theme, I am playing Adobe Systems Incorporated [[ADBE]] into earnings.

UPDATE: I bought some Brocade Communications Systems, Inc. [[BRCD]] and [[SD]].

This is a lovely market, supported by all of the finest people. You people are like small babies, with retarded brains, when it comes to investing in stocks. Take offense when I say “you have zero to offer the world,” just prior to seeing you try to burn it down. Never go to the website of a space alien magician and pretend to know the first thing about investing.

For example: many of you are so dramatic with your “critique” of my [[VXX]] position, as if it was a personal offense to you. You behave as if I said “your Mother is a Great Whore, who lives under a trailer homer, servicing convicted felons, in her spare time.” Relax yourself and go eat a greasy pork chop, lathered in lard. The discussion of ^Vix versus VXX is inane and unimportant. What’s important to know is that volatility, as measured by the Vix index, is near historical lows. Now, if you are so inclined to test out the brand new race track, in a brand new Ferrari, sans the breaks, be my guest and purchase call options on the Vix, that expire inside of a month. This way you can really get a nice great pop, or drop, for your money. Personally, I am perfectly content utilizing the slow moving vehicle, albeit flawed, that does not expire worthless next month.

It’s no secret that The Boeing Company [[BA]] is kicking ass, so far in 2010. Apparently, we are in, yet another, aerospace boom. Stocks like BE Aerospace, Inc. [[BEAV]] and Spirit AeroSystems Holdings, Inc. [[SPR]] have responded in kind and titanium plays are ripping higher too, namely RTI International Metals, Inc. [[RTI]] and Titanium Metals Corporation [[TIE]] .

All of the metals are charging higher, due to [[VALE]] proposed price hikes. Without a doubt, that is very bullish for the sector.

In short, this market is so fucking tempting to sell short; but it’s just not feasible, considering how much momentum there is to the upside. That pretty much sums up my thoughts aka “deer on Wall Street.”

It is being reported that [[VALE]] is asking for a minor 114% price increase from its good paying customers for iron ore. Health care stocks rip to the upside, as the government takes over the fucking industry. And, commodity bulls dig in their heels, preparing for the inevitable $100 tomato.

The only thing we are missing is a little private equity boom, topped off with a horrendous natural disaster, that will send natty aka “nat vegas” soaring above $15. Quite frankly, I yearn for the days when my local utility was telling me to go fuck myself, vis a vis a monthly bill.

If you little trollops are looking for cheap stocks, take a gander at Brocade Communications Systems, Inc. [[BRCD]] and Adobe Systems Incorporated [[ADBE]] , both positions of mine (full disclosure).

As an aside, you must admit it is funny as a fiddle trapped inside of a falafel, seeing Marvell Technology Group Ltd. [[MRVL]] , Broadcom Corporation [[BRCM]] and SanDisk Corporation [[SNDK]] trade at these levels. God bless capitalism and all of its authoritarian discipline!

Despite my bearish demeanor, I have zero short positions and 30% of my assets tied up in longs. With my longs, at the moment, I like Teva Pharmaceutical Industries Ltd (ADR) [[TEVA]] , [[CBD]] , Brocade Communications Systems, Inc. [[BRCD]] , Adobe Systems Incorporated [[ADBE]] and [[MWW]] . However, ultimately, I will outmaneuver most of you, via my burgeoning [[VXX]] and [[TLT]] positions.

Seriously, I’ve been a hardcore cheerleader for this rally. I’ve made every excuse, provided the internets with a plethora of reasons why stocks should trade higher; but this is just getting ridiculous.

Originally, I aimed for 10,500, then set my goals higher for 11,000. During the sharp sell off in January, I changed my mind on 11,000 and vowed to get the fuck out of stocks, once I was made whole again. Well, as you know, for the most part, that is exactly what I have done. While it may bore many of you to read my daily diatribes of “how to do the Hugh Hendry and why,” via [[TLT]] , you must remember, I conduct myself like a gentleman at all times and have perfected my trade of proper asset management, throughout the years, unlike many of you dart throwing coked out gorillas, running a hedge. I simply spit on you, from a range of 40-500 yards out.

Back to my point.

I look at stocks, trading with absurd valuations, like Baidu.com, Inc. (ADR) [[BIDU]] , Wynn Resorts, Limited [[WYNN]] , Starwood Hotels & Resorts Worldwide, Inc [[HOT]] , The Macerich Company [[MAC]] , Las Vegas Sands Corp. [[LVS]] , Amazon.com, Inc. [[AMZN]] and salesforce.com, inc. [[CRM]] and say to myself “this is going to be ugly when it ends.” I cannot say for certain when this Fed induced rally will end. However, rest assured, when it does end you will be swimming, mind you, in large capital losses, unless of course you are wise enough to plan ahead. The valuations that are now being applied to stocks, one year removed from the greatest economic collapse in generations, is simply unsustainable.

There are people who believe that equities can keep trading up, providing the dollar is debased. Over the short term, sure, that makes sense. But is that a logical trade long term? I mean, really, are you fucking nuts?

These days, everything is interconnected. A Japanese bank getting fucked in California mortgages can throw mashed potatoes on this rally and precipitate a global crisis, in one week flat. You cannot have a poor economy, weak dollar, and expect higher stocks indefinitely, based upon the idea that “since it’s priced in dollars it must go up.” WRONG. The chickens must come home to roost.

Take a look at what occurred during the credit crisis. Asset managers were stuck in funnels, dying to get out of stocks, as margin calls exasperated their cash calls. The only true flight to safety was in U.S. Treasuries, since it is backed by the full faith and credit of the United States. After all, when the shit hits the fan, where would you rather have your $200 million, in Treasuries or Freeport-McMoRan Copper & Gold Inc. [[FCX]] ?

Look, there is so much money invested in the U.S. markets, it would take some sort of parabolic shift to jar the dollar to startling lows. Money will simply follow the path it has always traveled, in and out of stocks and bonds. There will be no Exodus from the dollar into euros. If anything, euros will flood into the United States, in an attempt to escape their hopeless mess.

In recent years, gold has been plugged into nearly all asset management models. And, as a result, there is decent support for the yellow metal. However, once again, during the crisis of 2008, gold proved it was not a safe haven.

In short, enjoy the rally while it lasts; because when it ends, you are going to be shining my shoes.

Post trillion dollar heath care reform bill passage, this is how The PPT ranks health care names.

#2 sector out of 202: Drugs Wholesale

No.	Ticker	Price	Tech.	Fund.	Hybrid	Hybrid Change – Daily	Hybrid Change – Weekly
1	MHS	66.24	3.87	4.20	4.02	1.52%	28.03%
2	ESRX	102.01	3.87	4.15	3.99	1.53%	28.30%
3	ABC	29.22	3.57	4.50	3.97	5.87%	5.59%
4	MCK	64.65	3.92	3.65	3.80	1.33%	33.68%
5	CAH	36.25	3.87	2.95	3.48	32.82%	22.97%
6	OCR	29.27	3.77	3.10	3.48	20.83%	-15.45%

#3 sector out of 202: Hospitals

No.	Ticker	Price	Tech.	Fund.	Hybrid	Hybrid Change – Daily	Hybrid Change – Weekly
1	AMSG	22.55	3.77	4.95	4.28	28.14%	9.18%
2	CYH	40.39	3.87	4.25	4.04	27.04%	-0.98%
3	HMA	8.84	3.97	3.85	3.92	31.54%	0.51%
4	UHS	36.32	3.47	4.40	3.87	28.57%	-0.52%
5	LPNT	37.82	3.87	3.45	3.69	8.53%	-0.81%
6	RHB	27.28	3.42	3.80	3.58	0.85%	17.70%
7	THC	6.30	3.87	2.35	3.22	43.11%	10.14%
8	SEM	8.68	3.17	3.10	3.14	4.67%	43.89%
9	SSY	2.07	3.22	3.00	3.13	64.74%	28.51%
10	MDTH	12.64	2.87	3.05	2.95	-16.19%	47.03%
11	CCM	7.99	1.12	2.75	1.82	-1.62%	1.11%

#4 sector out of 202: Specialized Health Services

No.	Ticker	Price	Tech.	Fund.	Hybrid	Hybrid Change – Daily	Hybrid Change – Weekly
1	FMS	56.15	3.72	4.60	4.10	39.93%	-14.36%
2	HGR	19.01	3.77	4.45	4.06	0.00%	28.48%
3	BIOS	8.42	3.77	4.35	4.02	29.26%	17.61%
4	PSYS	30.45	3.77	4.30	4.00	41.34%	-0.95%
5	HLS	19.47	3.77	3.90	3.83	27.67%	0.52%
6	DVA	64.18	3.67	4.05	3.83	17.48%	17.43%
7	ALLI	6.60	3.27	4.35	3.73	0.00%	-0.27%
8	PRSC	15.05	3.72	3.30	3.54	49.37%	58.48%
9	VRAD	10.39	3.12	3.95	3.48	48.72%	44.40%
10	HWAY	17.68	3.82	2.90	3.43	4.57%	3.94%
11	MD	57.89	2.27	4.75	3.33	-1.77%	-14.80%
12	ANCI	1.89	3.22	3.45	3.32	11.78%	51.60%
13	IPCM	34.28	2.27	4.10	3.05	12.55%	1.33%
14	NHWK	3.38	3.17	2.60	2.93	1.03%	67.82%
15	TMH	16.00	3.57	1.80	2.80	1.82%	0.72%
16	MDZ	8.34	1.87	3.65	2.64	0.00%	-25.14%
17	NBS	1.80	1.67	2.30	1.94	-37.01%	-34.56%

#5 sector out of 202: Medical Equipment Wholesale

No.	Ticker	Price	Tech.	Fund.	Hybrid	Hybrid Change – Daily	Hybrid Change – Weekly
1	OMI	46.08	3.77	4.35	4.02	20.72%	-20.92%
2	HSIC	58.16	3.82	4.15	3.96	1.54%	1.28%
3	MWIV	44.37	3.97	3.90	3.94	2.87%	31.18%
4	PDCO	31.22	3.87	3.65	3.78	32.17%	9.57%
5	CHDX	11.97	2.77	4.60	3.56	-6.81%	-9.67%
6	PSSI	23.85	3.22	4.00	3.56	20.27%	-7.53%
7	STAA	3.65	1.87	2.55	2.17	2.84%	-23.21%
8	AHII	1.82	1.37	2.60	1.90	6.15%	1.60%

You get my drift. Medical stocks, across the board, are higher today, as if the government will allow unlimited profit margins. I realize 32 million people will be inserted into the system. However, I have to believe there will be some constraints or caps on profit margins. Although I do not understand the true essence of the health care bill, I know enough about government to know they could give two fucks and a gay goat about shareholder value. If I was long any of these names, sans solid wholesalers, I’d book the gains. Within wholesalers, I like AmerisourceBergen Corp. [[ABC]] and McKesson Corporation [[MCK]] , based upon the prospect of much higher drug volumes.

Adobe Systems Incorporated [[ADBE]]

I bought 10,000 Adobe Systems Incorporated [[ADBE]] @ $32.90.

Disclaimer: If you buy ADBE because of this post, your government will spend all of your tax dollars, AND MORE, on crazy eyed projects. And, you may lose money.

Bravo, bravo, a job well done! I must admit, I did not expect the market to climb higher today, amidst news of horrendously poor economic policy change. Don’t get me wrong, I am not judging the Prezident or his health care initiative. Basically, I feel it is always a mistake to jack taxes higher, while trying to climb out of the deepest crevasse since The Great/Awesome Depression.

To see the market tick higher, despite the news, makes me feel all warm and cuddly inside. Because, unlike God, now I know for certain that our government overlords are watching us, ever so intently (tear drops from face).

Do not expect “The Fly” to trade in a market he does not understand. However, I will tell you, Adobe Systems Incorporated [[ADBE]] looks good here, as well as a variety of other stocks. Perhaps I need a good talking to, in order to “correct” my erred ways. But then I look up at my monitor and see, dammit, I SEE SUGAR DOWN AGAIN (crying profusely). Has the world, suddenly, decided to go on a diet and kick the ol’ diabetic lifestyle to the curb? Perhaps.

With my money, I will bore you to death, doing “The Hugh Hendry” and nibbling at [[VXX]] .