CATASTROPIC COLLAPSE ***

This is a God damned Red Alert and perhaps it will amuse you to learn that yours truly was completely dispatched in the market place of men today. I had ideas and all of them were wrong, rooted in greed and my desire to be something or someone important. I wanted to be a winner, you know, the type of person looked up to as an ideal to others. Instead of all of that happening, I found myself in a cold kitchen cooking for the fucking dogs — down 411bps for the session.

How did it all happen, when I knew myself so well I actually warned myself in the opening blog today?

“On days like this, I often churn myself into oblivion and end up staring into the mirror blankly for stock advice that doesn’t exist.

The best course of action, at least for me, is to fuck off now and remain in 65% cash, hedged, so that I can reflect upon my errors and remember them.”

I will tell you, and much more, so that you never forget the lessons I am about to teach you.

I was having difficulty finding stocks to trade and most of my go to stocks were down for the session. But like other down days in this CLOWNISH tape, I figured we’d somehow someway ramp into the fucking afternoon and gleefully skin the bears alive.

We started to dive lower late afternoon and I saw 5 consecutive red candles hit the tape, accompanied by a massive spike in the VIX and inverse ETFs. Under normal circumstances, I’d take that as a signal to hedge and reduce long exposure. But since I was feeling adventurous, I did the opposite and bought in after that 5th red candle hit.

The odds were, after all, forever in my favour. We have seen this pattern play out time in and time again and the results were a FUCKING RAMPAGE into the close. But not today. Soon after, markets took on an apocalyptic undertone and the losses became both ribald and transfiguring. I dazed into the screen and had flashbacks of my life as a young stockbroker — punk son of a bitch know it all averaging down into the maelstrom of the dot com blow up and acquiesced  to extreme jeering inside the denizens of Stocklabs — where my enemies trounced upon me, joyous to see me taken down a notch. I had to liquidate it all and behold the specter of DOWN $53k for the session — ending up, as it would be the case, heavily long VIX and short the fucking NASDAQ into the bell.

The bigger picture here is my month to date gains have been reduced to +1%. My amateurish risk management today caused me to give back two weeks of returns all because of unchecked greed and a sinful demeanor that was rightfully checked.

In short, I deserved today’s losses and I’d like to tell you that my best days were behind me and that I was once a great trader and it’s all over now. But that’s not true, just like Pax Americana is still plodding along. I am at my pinnacle of trading success, perhaps in the top 0.5% quartile of all traders in America and this was my day — for all of you to enjoy and bear witness to my agony and shame.

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