Summer Doldrums

People, this shit always happens in the summer, leading into the fall. You act as if this is the end of the universe, on our way towards an apocalyptic black hole or some shit. Every fucking summer, like clock-work, the markets get dicey. Then in the fall, we get crushed with devilish anvils. Then, finally, we run into the Thanksgiving-Christmas holidays. It’s as easy as greasy peasy.

Am I upset about today’s events?

Answer: yes.

Is it disturbing my vacation, which entails watching Jeremy diving into icy waters, not so much different than a fucking penguin?

Answer: no

You fuckers need to chill out and realize we are in a normal trading pattern, leading into the end of summer. If you think the downside is limited here, position for a rally. If you are disappointed with the results, after just 1 week, seek mental therapy.

If you’re gonna be in this game for longer than a few months and avoid aneurisms in your brain, you really need to eat more sandwiches and balance your portfolios out a little, pal. If you lose it all, you deserved to lose it, since you ignored risk management.

Keep some cash on the sidelines and buy your neighbors margin calls. The sky is not falling; you’re just too high on your own ego to figure it out.

NOTE: Once again, the culprit is the bond market. Keep watching TLT for evidence.

I do not get this sell off, which makes the market that much more fascinating to me. It’s like a never ending puzzle that changes all the time. The minute you have it figured out, BAM, it switches up on you. The greatest minds and most successful people in the world gravitate to the markets, not only for monetary reasons, but for the challenge. I could ramble on about how wrong you are and how awesome “The Fly” really, truly is, but that would help no one.

Instead, I want you to know that I am a beginner at this every single day. As much time and effort and experience garnered in the business, my approach is new, almost every single day. Throughout the years, I have developed thousands of different trading strategies and concocted countless theories, as to why stocks advance or decline. Some worked for awhile, others still work today (The PPT). However, the important message I am delivering to you, as you gawk at my Godliness from the “un-luxury” of your bullshit pleather chair from Staples, is this: be green.

In other news, I bought some ROP down here, looking for a 5 point run. And, I am about to get the flog out of here, en route for breakfast.

NOTE: The market will not rally without yen and TLT weakness.

As my west coast trip progresses, the market seems to be firming up here, especially now that all of the Hindenburg circle jerkers are out and about—galavanting around town—with their little facts and figures.  I spit on your facts. I shit on your figures. Actually, scratch the latter, for it is fairly disgusting. But you get my drift.

At the end of the day, when you bet against S.H.O.M.P, you get your face “ninja’d” the fuck off and your body gets paralyzed, as if you just got hit with a taser.

This early morning sell off is fucking bullshit, as all of the key ingredients for a rally are present. The dollar is weak, yen is weak, treasuries are benign and oil is up. What more do you want, an engraved invitation?

Going with The PPT‘s proprietary OVERSOLD signals, I bought some FLS yesterday, as it has been 80% accurate with its OS signals over a 5 day holding period. And, as you know, I am long UCO—based upon the unbendable laws of supreme and final mathematics.

On a personal level, I intend to finance my entire west coast excursion through my bountiful TNA position, which is terribly ripe for a run higher. All of these facts must confound a person, such as yourself. Some of you lower tiered bloggers must be like “WTF, OMG, that’s impossible.”

Incorrect, good sir. That’s where you are wrong. Believe it with your own eyes, else lose them during the great stock market rally of late August, 2010.

Off to wake up Jeremy, “the IT guy,” as he is staying in La Jolla as well.

UPDATE: I bought back my GMCR position, at least 50% of it.

The nasdaq had a decent day today. Inside of The PPT, my 4g index was up more than 1.4%—vastly outperforming both foreign and commodity stocks. Rightfully so, especially since tech stocks have been battered more than any other sector. If this market is going to rebound, tech stocks will lead the way. However, all sectors will participate, so get your fucking lists ready, as if your name was Santa Claus.

The rally will be buoyed by treasury/yen/dollar weakness. In addition, we should see a decent rally in oil, which is why I took down a position in UCO today. I expect to sell most of my recent positions into this rally; but I have not written such prophecies in stone—only cement.

Some of my long positions include BUCY, FLS, TNA, FAS, CBL, BAC, GLW and EWZ.

It chagrins me a great deal to be missing out on a party I have planned on attending since the beginning of 2010. While you may view this decline as something of fantasy, I was expecting this to happen—as the economy double dips into Hades. The reason why I am quasi bullish now has nothing to do with fundamentals. It is about the rubber band effect and the results of sticking ones head in a hot oven for too long. Nothing goes up or down in a straight line. I am positioned for a bounce; but still have 1/4th of my assets in an alleged downside hedge, VXX. Keep that in mind when I talk of menthol cigarettes and American dreams.

As scheduled, just in time for the debut of Wall Street II, the market shall feel the pain of unrelenting asshattery. When the time comes, I plan to have zero longs and chockful of shorts. There are many things to worry about: widening CDS in Venezuela, Argentina, PIGS and the biggest bubble known to mankind China. However, everything works on a schedule.

The rubber band is stretched to its limit and in need of a little release. I am not sure we will get some fantasm of a rally today; but it’s coming.

Off to vacation again, Obama style.

I initiated a position in UCO, FLS and added to EWZ.

Disclaimer: If you buy the above stocks because of this post, you will fall victim to a heinous act of immoral stupidity. And, you may lose money.

There is no time to waste. You mustn’t procrastinate any longer, for this market is about to rip your short hairs off. The rebound will be lead by CRE and retail stocks and there is nothing you or your stupid friends can do about it.

We need the dollar and TLT to start nosediving; then we will have our rally, AND MORE. This coming rally represents freedom, democracy and the American way. It is everything your Grandparents built and nothing you opt to destroy. This rally will make all other rallies look like child’s play, sort of how the ruins of Puma Punku make the shitty pyramids at Giza look. This rally will be the crown jewel achievement of the O’bama administration. He will laud it from the perch of his vacation home as “the greatest American achievement since the invention of menthol cigarettes.” This rally, in short, will punch your fucking faces and necks off—mainly because you deserve it.

You can go back to dancing again. Thank you for your time.

I know my boy Scotty likes to throw my little VXX into his play volcano, where he stacks it with Pepsi and mentos; but you must admit, with all of the shit hitting the fan right now, volatility is cheap. For the love of fucks sake, it was trading above $30 in a market that was not nearly as creatively destructive as this one. We got imbeciles doing “The Hugh Hendry” long TLT, on the exchange floor, as if that shit was really a dance move. And, the currency degenerates aka OTB guys, are destroying the entire country of Japan, via forcing yen higher. This all stinks to high heavens, despite JAKEGINT’s “cement head” (CH) demeanor. As the handsome Senator from KY country gets ready for his run in 2012, “The Fly” is busy trying to save his overzealous kids from drowning in the Pacific ocean.

As it stands now, this little trip of mine is proving to be immensely expensive, as I find myself out of the loop of certain things to do with Wall Street and “in the know” of cool places to gobble down eggs benedict. There is a certain laziness to the California lifestyle, which is much different than NYC. In NY, I tend to be on edge all of the time, looking out for murderholes. Over here, I seem to not care about holes, whether they are pits with money in them or life vacuums.

As I can see by the close, stocks closed badly today. At this point, I cannot be optimistic. Seeing my VXX position barely up in the sea of tragedy, I am disappointed, but not demoralized. As this hole in the Earth gets bigger, people will eventually fall into the vortex and force them to declare “mercy.” When they do this, by way of capitulation, I will sell VXX for more than $30.

Before that happens, as God is my witness, we shall have a rally—especially since the laws of mathematics kicked in today.

More on this later.

Homes sales are through the fucking floor boards. Now, I don’t want to hear about unemployment rates or how poor America is, when it comes to these numbers. After all, everyone I know has a job and lots of money in the bank, sans a few assholes that I grew up with in Brooklyn. With home prices 30-60% lower than where they were 5 years ago, the only logical answer to the “housing question” is “The Banks Hate You.”

You fuckers burned them last time around and now they hate you. Can you blame them, really? You fucking deadbeats nearly destroyed the entire world-wide shadow banking system, with your retarded Mcmansions. Hell, if I was a banker, I’d toss my dollars anywhere but the housing market. Because of this fact, I believe the Fed is trying to squeeze the banks into upping their risk profiles, by way of tightening the spread. They can’t raise rates, for that would cement the economy down. However, they can manipulate bond yields, effectively tightening the noose around the bankers necks.

The game of borrowing money from the Fed at low rates and buying treasuries is coming to an end. “The Hugh Hendry” has run its course, as predicted here by the way. The upside to TLT is limited and the risk is now on the other foot, if I might be so bold (no idea what that means).

We need ZERO DOC, ZERO INCOME NEEDED type of loans again, only this time at lower real estate values, to save the country from a housing depression that will make your faces bleed (again, no idea what I am writing here). The point I am trying to make, rather ineffectively: Your local bankers need to up the ante. Are they man enough to lend you money again? Are they stupid enough to finance more Mcmansions in the middle of the desert?

NOTE: CRE stocks are leading this bounce higher, alongside homies.

We should be down 300-400 points today, considering the Yen and bond markets are unhinged. Take into consideration the bloodbath in Europe, we are fortunate to have such lovely, benign, robots controlling our markets. Those French robots must be real assholes. I bet they smoke cigarettes on the trading floor.

I made a commitment to refrain from making any trades, until after 10:30. The reasoning is to allow the excess to get out of the tape, considering  all of the pole smokers who jumped in/out of the market, following the HORRIFIC housing numbers. You must understand, days like today is when you lose it all, literally. The tape looks so bad, it’s as if the stock Gods are granting us all a gift, in the form of FREE SHORT SALES. Hell, we can short anything and get rich. Oh, but wait, it gets dicier. All of a sudden, the dollar goes down and inflationistas start diving into empty pools again, via large directional long bets. Eventually, the pool is filled with a bunch of dead bodies, making it safe for newly minted inflationistas to jump in, without fear of death. Then the rally begins.

In no way am I suggesting, at such an early hour, that we will have a pool over flowing with inflationistas, which effectively will lend towards a robust bounce. That would be most preposterous, small pleb. I am only offering an alternative ending to the fucked up story-line we are given.

In short, keep your eyes on the metals, banks and tech. Dollar weakness is good. But we need some deterioration in the Yen and bond markets, if we are to witness a bounce of stupendous proportions.