Tweak

I did not like the weightings in my portfolios, so I changed them. As a result, I bough the following names:

FLS, NVDA, STI, TNA

As you know, I sold out of FAZ, solely based upon my respect and admiration for The PPT.

Okay, now back to sandwiches.

Here are all of the OB/OS signals in PPT history, layered onto two charts.

Like believing in God or Santa Claus, faith is required when investing. Whether you are long or short, you need to believe in something in order to have conviction. Let me tell you right now, without conviction, you are not going anywhere. You will fail.

Right now, if you are bullish, you have faith in the Fed and low rates super charging the economy. You believe, due to low rates and an accommodative Fed, we will reflate ourselves the fuck out of this giant mess, regardless of inflationary dangers. If you are a bear, you have faith in human error and all of the chickens coming home to roost NOW. Being bearish requires a certain type of brain, one that is disconnected from the “matrix” and able to turn a disaster into a profit. Not too many people are able to do that effectively.

There is a third camp, one that is reserved for the most distinguished men on Wall Street: the sandwich camp.

If you are into not giving a fuck about the bulls and the bears and only interested in banking coin, then now is the time to eat a sandwich, dressed with very little condiments, might I add. This is my camp. I have no loyalty to anything but the bottom line. I do not care about your catalyst, only the end result.

With regards to this tape: we are OVERSOLD and due for a bounce. However, I am afraid there are many fucked up mountain roads to navigate before we are out of imminent danger. I will not sell any of my longs, unless we climb 2-4% from here. Conversely, I will not sell my VXX, unless we dive 2-4% from current levels. Essentially, now is the time to do nothing.

UPDATE: I sold out of FAZ and bought 10,000 TNA @ $35.65.

As world government bodies try to paper over egregious and insurmountable losses, weird shit is happening.

Weird shit #1:

Japanese Yen appreciation. What the fuck is going on in Tokyo? That fucker is booking higher as if the carry trade itself fucked itself into a murderhole.

Weird shit #2:

Euro appreciation. I thought the Euro was going to zero? Are we past that stage in our lives yet or no? I just need a little clarity so I know what to fear monger about.

Weird shit #3:

Oil is not going down. Go fish.

Weird shit #4:

The SEC settled with Goldman Sachs on the same day BP capped the fucking gusher. I am a big disbeliever in coincidences.

Weird shit #5:

2010 is the hottest year on record, yet global warming is a farce. Blame the sun.

Weird shit #6:

NYC is fining people for stealing trash, as they deem it to be a “valuable commodity.”

Weird shit #7:

Someone cornered the cocoa market last week and not a peep about it. Some group of jackasses bought all of Europe’s cocoa supply. Can you say Willy Wonka?

Weird shit #8:

Treasuries are still strong as fuck and yields are absurdly low, pointing to a double dip recession. Low rates are not creating jobs, only offering safe haven for banks, via spread.

Weird shit #9:

China claims to be growing at 11%, yet steel mills are declining in capacity utilization.

I can continue: but why bother? You need to stay focused on all this “weird shit,” for eventually it will end up killing you. Mark my words. At any rate, I will be inserting all of this data into my “calculator brain” shortly and decide where I am willing to go with my assets, over the short term.

Some of you old school ibc’ers are well aware of the story pertaining to “Jack the Convict.” For those of you who are unaware, check the sidebar tag “Important Matters” in order to get schooled.

Anyway, I am happy to report that Jack is back, only this time in the form of a Crustacean! The story is good, but the ending is yet to be determined. So, once the story concludes, I will be certain to update you via an Important Matter post.

The stock market is under some sort of “mountain magic” spell, whereby phantasms get into the wires of the trading robots circuitry and make it go down. Why else would this market go down, amidst such a wondrous recovery? This recovery is so good our Prezident deems it unnecessary to work. Instead, he parlays around the mountainside or his local golf club, in order to enjoy a little r and r.

Either way, “The Fly” is like a 200 foot oak tree that shits on your bullshit chainsaw. Scientifically, I cannot be defeated, since there is win in my blood.

Back to your regularly scheduled fun filled sunday afternoon.

No fucking idea what to expect next. Anyone who says they do is a despicable liar, deserving of the electric chair.

FYI: The way I calibrate my asset allocation, for precision, is to monitor account values every hour and see if it’s working. If accounts start to slip, I adjust accordingly. My current plan is to freeze my accounts, via hedges, on sell offs and buy the dips. Thus far, it has worked like a charm, as we fucking grind our way to oblivion.

Quit getting all jelly ass on me and do what you were born to do. Well, actually, don’t do that, since most of you were born to mow my lawn. Today’s sell off came as a surprise to many, mainly because we like parties. It’s human nature to enjoy a good cocktail party. We dress ourselves up like penguins and walk around with top hats and canes, whenever invited to high end NYC soirees.

Some of us mingle amongst the crowd, complimenting each other about the “luxurious and decadent design” of pocket squares or prep school blazers. Others, lurk in the background, plotting to exact revenge on the person(s) who sent out invitations. We all have a role in this stupid world. Some are commissioned to hoodwink billions into war. Others, on the other hand, create scams based upon peace. As for me, I just bank coin.

Life is nothing more than a series of coincidences exacerbated by our actions.

If you find yourself getting ham and egged today, long equities into a sell off: chill the fuck out and put things in perspective. We are 100’s of points higher than the recent lows and most of us have solid YTD gains. Today could be the beginning of a severe sell off, or a one off event. Either way, it’s important to be in control, instead of relying upon hopes and dreams, like most fucktarded money managers featured on the teevee.

CDS spreads are widening for Ireland. Does that mean Ireland “is next”? No, but they are at risk of being “stealth raped,” pardon my terminology. What to do, what to do, what to do?

One word: HEDGEYOURSELFBITCH

This is the way Wall Street works: get caught leaning and bleed out like a fucking pig in a slaughter house. I’ve said it before and I will say it again: this market is a fucking meat grinder. Fuck the news: it’s always bad. However, today’s action points to a 3-4% decline, something I am unwilling to ignore, being 90% long.

So, over the last half hour or so I sold out of the following names, some for profit, others for loss:

GS, CLF, SHLD, CRNT and half CIEN.

Understand something, I did not want to sell them, but had no choice.

With some of the proceeds, I bought coconut sized aka “gorilla ass” positions in both VXX and FAZ.

Do I think we are heading back into the deflationary vortex of certain death and calamity?

Answer: Absolutely.

Nevertheless, I did not go “full retard with titled head” short. Instead, like a gentleman, I simply hedged, while thinking about puffing on some cigars. Current allocation stands at around 20% VXX, 20% cash and 60% long. This blend has worked wonders for me in the past and will do so, yet again. Should the market climb, my gains will the “midgetized.” However, who gives a shit? This mornings losses, out the gate, were about 2%, give or take. I did not want that 2% to morph into 4%, with a possibility of getting “clown raped” on Monday for another 2%. That’s how bad habits start.

So, instead, I acknowledged the fact that I was wrong and moved on.

What about The PPT?

Well, I sort of ignored it. The fucker printed 3.10 earlier this week and closed above 3 on 7/8 and 7/13. I was waiting for a close above 3.10 to give me the green light to sell out. Perhaps I was being a little too picky. After all, the 3.00 line has worked numerous times in the past. There is a strong possibility it will prove on point, yet again.

I bought truckloads of GLW, EWZ and X and nibbled on some MLNX, reducing my cash position to around 10%. This is as far as I will go.

In other words, I am “all in” fuckface.

Let the games begin, despite the obvious fact that this is not a game anymore.

I will have you know, the stocks Gods make sure that I am protected at all times. For example: today’s a bad day for many of my positions, but they’ve managed to turn FTK, GS and SHLD green (some of my largest holdings), effectively stymieing my losses to nil. For the record, FTK was last years disaster. Year to date, it’s up more than 20%.

Let me be the first to tell you, in the utmost of baritone tones: IF THIS IS ALL THE BEARS GOT, WE WILL SLAY THEM, and more!

Going into the “closing hours,” I suspect a little hand wrangling out of the bear camp, shimmying their spastic asses into custom made murderholes. I fucking warned you about those.

Nonetheless, with my money, I am sitting tight, with 27% cash. Should the market firm up into the last hour of trade, I will deploy all of my cash, AND MORE.

That’s because it is bad. With TLT and FXY sprinting higher, “The Fly” is in no rush to allocate all of his money into stocks. It’s not that I won’t do it: I just won’t do it right now.

On the bright side, natural gas is going higher. Does that mean anything to you? Anyone? No?

Ah, the market is getting lit up. I suspect it will get a little worse, before it gets better. So, like they say in France, when things get dicey: “I am getting the fuck out of here and going for a walk.”

More on this later.

UPDATE: On my way out, like a rat nibbling on a piece of sweet corn, I bought 5,000 CIEN @ $13.33.