Throwing Some Dice

I like the way sentiment shifted this morning, as consensus went from “OMG, we’re fucking doomed” to “Europe has been saved again.” Also, Cramer took his DEFCON 2 threat off the table, always a good thing. I bought some DECK, MDR and TNA. I didn’t go all in, only allocating about 15% of my cash–leaving me at 25%.

The thought process is fairly straight forward: maybe, just maybe, we can focus on US fundies for about two weeks, leading into an end of year melt up. If not, I will be proven wrong, forced to take some losses. This shit doesn’t scare me, it really doesn’t.

Out of all of my positions, believe it or not, I like RBCN best now. The short position is too fucking big and the stock has been acting strong. Look for this shit to peel off the fucking faces of unsuspecting bears soon. Also, I like GSVC. It’s one of those stocks that is able to punch people in the face, all day every day, and no one will even notice.

Yesterday I was declaring “be scared” and today I’m bangin’ out million dollar trades on my iPhone. So goes the market.

http://www.youtube.com/watch?v=HRQFd3TWoF0

I bought MDR, DECK and TNA.

I have an early morning meeting to attend and I see the futures are fading. The truth is, buying on a Friday with this European horse shit to deal with over the weekend is a high risk play. If you’re into that sort of thing, have at it.

I intend to buy this dip, at some point. However, I’d prefer to see a really ugly trading session before I allocated my 40% cash horde.

In my personal/aggressive account, I am 100% cash, waiting to leg into TNA or ERX.

I feel that many of you are where I was 10 years ago and no matter what I say or do– you’re gonna blow yourselves up anyway, as is the nature of the market.

I feel I spend too much money.

I feel my bank account is too big, compared to the size of my house.

I feel nothing at all towards religion, even though I grew up catholic, as an altar boy, and all of that shit.

I feel making money in stocks isn’t so much fun anymore and my clients are fucking ingrates.

I feel they have no idea how lucky they are to have me. They could have you.

I feel the years are getting by me and I am not accomplishing enough. My kids are getting bigger and it makes me sad to see their baby faces mature.

I feel like this website is a revolution in finance and if people cannot relate to my passion, they can leave. Everyone hears my thunder, but fears to acknowledge it. Fuck them.

I feel that every other website is horse shit, even if I like them.

I feel friendship is overrated.

I feel selfishness is the worst of all possible traits and I do not want to be around anyone who talks about himself for more than 2 minutes.

I feel like moving out of NY, but do not know where to go.

I feel like opening a hedge fund, but don’t feel like going through the process of making it happen.

I still feel poor, even though I have money.

I feel like I want to read more of the classics.

I feel sorry for people who never find a job they love.

I feel if I drank coffee that would make me weak (I quit 9 months ago). I do not think it’s healthy and I always make an effort to eat healthy. Therefore, I will never drink coffee again.

I feel rage towards lazy people who do not find pride in their work. The small things matter.

I feel that by writing about my feelings on a blog is bitch-like, so I am going to stop right now.

The republican party in the United States supports the bold and decisive inactions of the fucking Germans in Europe. Spanning over thousands of years, the German people have never contributed to society. Instead, they’ve deducted from it. They take what they want, when they want it, no matter the “feelings” of their neighbors. If you are wondering if Germany will come to their senses and finally agree to finance European debt, remember these are the same cocksuckers who used to gas kids.

They are kamikazes, ideologues, the idols of our ignoramuses in the the GOP–addled with serious mental issues stemming from the very depths of their fucking DNA.

Nevertheless, I sold out of my TZA position today, booking an 8.5% gain on the OVERBOUGHT flag, provided by timely algorithms inside of The PPT last week. I left the account in 100% cash.

For managed accounts, I shed less than 0.5%, thanks to my 40% cash position. I am still long LULU, GSVC, GMXR, WNR and RBCN.

Correct me if I am wrong, but Draghi said the ECB was not going to support massive euroville bonds purchases. Yields are spiking across Europe and the euro is tanking. Yet, for some odd reason, US markets are yawning in the face of this horrific news.

I want you to be scared. This is not your ordinary set up. These fucking imbeciles are playing Russian Roulette with bond vigilantes. Are they not aware of whom they are dealing with?

This all has the hallmarks of a bottom falling the fuck out type of market, as the European perverts in Brussels fuck it up once again. We need to brace for the reality of inaction times ineptitude equals catastrophe.

The deflation trade is back with a vengeance and there aren’t many places to hide. I am 37% cash and building.

If nothing gets done, not only will not regret being heavily long into idiocy; but you will regret your birthday.

There’s been a lot of buzz these past few days inside The PPT, with regards to our new trading system, using the Overall Hybrid Overbought/Oversold signals to place long and short sale trades. Those who are familiar, the results convey a picture of mathematical brilliance, something I’ve been alluding to for several years.

The rules are very simple. For example, when the algorithm says “oversold” a buy order representing 1/3rd of a position is executed. Another tranche is not executed unless the system flags oversold again. Should the algo go straight to overbought, due to a sharp market reversal, then the buyer will have to suffice with just 33% of his assets invested. No matter what, upon an overbought signal, the entirety of the account must be liquidated and a short sale placed.

In other words, on both the long and the short side, money is allocated in three tranches and liquidated in its entirety upon receiving an OB or OS signal, depending on whether you are long or short.

Here are the results since inception or 2009.

2009: SPY +32.3%, DIG +76.35%, ROM +148.61%, OIH +101.5%, IJR +32.3%, XLB +52.9%, ERX +155%, TNA +84.9%, UYG +28.5%
2010: SPY +18.34%, DIG +56.4%, ROM +84.01%, OIH +61.5%, IJR +29.48%, XLB +39.6%, ERX +97.8%, TNA +123.3%, UYG +31.4%
2011: SPY +12.79%, DIG +52.72%, ROM +18.66%, OIH +16.75%, IJR +24.76%, XLB +23.6%, ERX +71.6%, TNA +65.6%, UYG +12.5%

This is a brand new study and we will be building upon this framework to include highly correlated equities. We have data on stocks like FCX and EXK and the results are similar. When gazing upon this data one thought comes to mind: “Sublime Harmony of Mathematical Precision (SHOMP)”. By the way, that UYG (financials) data is about +50% in outperformance versus the year to date returns of the buy and hold crowd. Indeud.

Spread sheets with details are provided inside The PPT.

In other news, Europe is disappointing again. The Italian meatball at the ECB said, and I am paraphrasing here “we don’ta knowa what the fucka yous a talkin’ abouts. The ECB isn’t doing a shit.”

Get to cash.

http://www.youtube.com/watch?v=7LYbdbpifd4

I don’t need this shit. Did you see how stupid the volatility was today? Wait until the deviants from Europe get together and poke fun at one another. The last thing I need is a heart attack for X-mas. “The Fly” intends to drink whiskey and splurge on holiday nonsense. I will eat rib roasts and consume large quantities of left bank Bordeaux.

I edged higher today by 0.45% and opted to sell a large position of mine, CVI, because crack spreads are nose diving again. My cash position stands at 37% and I have a lot of fire power to buy shit like GMXR. Call me Santa Fly.

In closing, fuck this end of the year homo shit. “The Fly” is much more interested in gaudy watches and unnecessary discretionary spending.

Top picks: RBCN, GSVC, LULU, GMXR and TZA

I doubled my GMXR position.

I sold out of CVI.