A New Era of iBankCoin Supremacy Has Arrived

Armed with algorithms that literally predict the future, and now the most comprehensive equity analytic software the world has ever seen (Exodus, coming soon, I promise), “The Fly” has turned over a new leaf, one of extreme winship–based upon certain truths that cannot be debated. Gone are the days of wanton speculation and outsized drawdowns. Believe it or not, I’ve learned a great deal about the market in recent months and I am not ashamed to say I continue to learn from the great humbling mechanism that is equity trading.

Like in all aspects of life, if one doesn’t adapt to a changing environment, one will become extinct (extra dinosaur). There isn’t any denying certain truths that I am about to reveal to you.

Your gains will always be higher if you exclude Chinese burritos from the menu of stocks that you choose from.

Your gains will always be higher if you’re buying companies with a specific amount of free cash flow. The number cannot be too low or too high. It must be just right (don’t ask).

Your gains will always be higher if you accept the fact that trading quickly is a poor man’s game. Buying over periods of time, in increments, is a preferable method of investing for a wide array of reasons.

This isn’t 2013 anymore. The market is asking for certain requirements before sending your stocks higher. As for me, I am making headway in MS, MD, JAZZ, MUSA, N, SGEN, HAR, SBNY, just to name a few. Being that I have a very large cash position and lots of ideas of how to reinvest the money, I began buying today, starting with SKX and LVLT.

In light of the HABT decline, I added to my position. I have 7 months left of dollar cost averaging into the stock.

The PPT Wins again– to the exact day.

This is getting tiring. The Federal Reserve isn’t going to jack up rates, jackass, because they cannot. Listen to me for the 10,000th time: if the Fed raises rates, it will be responsible for completely destroying a wide basket of foreign currencies, and by extension, hurting US multi-national firms. Are you even monitoring the rout in the euro vs the dollar?

It’s like the media is filled with catamite idiots, the dumbest varietal of human being. There isn’t a basis to raise rates, not now, not ever!

Pray tell me, why should the Fed raise rates, aside from the moronic idea that we need “bullets” for the next crisis?

All European yields are at RECORD LOWS. Negative yields persists and King Dollar reigns supreme. WE DO NOT NEED TO FUCKING TIGHTEN WHEN INSIDE A DEFLATIONARY VORTEX!!!

As an aside, INTC just warned thanks to currency fuckery. Banks look good and the market is set to bounce, as predicted, yet again, by The PPT.

SHOMP.

Someone wake me up when the bulls grow balls.

If we can’t bounce after a 330 point drubbing, we are going lower. I don’t make the rules. I merely read the tea leaves.

I’d get into watch lists and other things, but it’d be a waste of everyone’s time. You never pay attention to posts like this anyway. For some reason, you only pay attention to when I buy boat stocks or threaten to kill someone.

Nevertheless, if you’re cash rich like me, keep waiting for signs of courage.

However, in the event this support, this level of oversold doesn’t hold, you want to be cautious here. Right now, right here, is a very important level for the short term sentiment of stocks. Despite my predisposition to believe stocks are guided, ultimately, by its fundamentals, certain harbingers of doom present themselves to us in the form of price action–often. Last year, this time, bubble stocks nearly destroyed me. I’ve built my business on the bones of others for over 15 years and in one fell swoop, last year, it almost drifted away into the winds of oblivion. Naturally, such a thing as that is nearly impossible for a person of my high caliber. Nevertheless, it got dicey for a minute there, and for most of 2014.

But this is a new year. We have new ideas and a fresh approach to stocks, hell bent on redemption and bleeding out our enemies through acts of attrition.

If this were another time, I’d join you in your holy war against the devils who shorted your stocks. We’d smash them to bits and pieces, take their valuables, then set off for new lands. But I must remain cautious, in the most stoic of ways possible. My returns of 13.5% must stick and I must build upon it, for it is a fortune worth preserving.

Bottom line: I am waiting for confirmation of a bounce and will stay cash heavy until I see courage.

I have a unique perspective on markets and offering financial commentary. Unlike most of your internet hot-shots, guys trading in and out of stocks for nickels, never allowing a loser to marinate for more than a few hours, I do this for real, with real money. When you’re managing real portfolios, for real people, one doesn’t spin in and out of trades like a fucking idiot, especially in 3x ETFs. As a matter of fact, the industry that I work in hates 3x ETFs and makes it a point to stop you from buying or selling them.

Many of you are young, cow eyed, punks, with little to no money to your names. That’s fine, since we’ve all been there. Hopefully in a few decades you’ll have enough money to consider yourself a person of interest. The problem that I have with most commentary, especially on StockTwits/Twitter and an array of low brow sites, is the allure of fast money and riches. Listen to me now, the stalwart part of your revenue stream will derive from industry, not speculation. While it’s true, some have made mind-boggling fortunes in venture capital over the past 10 years or so; that’s not sustainable. Eventually, everything comes back to the mean and those buying late get diced like pineapples (extra Boss Ross).

I come across as combative, sometimes unstable, and somewhat of a carnivale clown with a murderous streak in him most of the time. But I do have a reservoir of experience and wisdom worth sharing when it comes to this line of work.

It’s important to dream; but don’t be delusional. Setting unrealistic expectations for yourself, such as duplicating ridiculous 10k to $1million portfolio success stories, is next to impossible. You have a better chance at getting struck by lightening than doing that. Also, the idea that you should quit your jobs and only trade, despite not having a high net worth, is dangerous. Some can do it; most cannot.

Trading is almost like gambling, except for the part that if you wait long enough and buy good companies, you’re most likely to have success, whereas the exact opposite applies to gambling. Anything worthwhile is worth waiting for. If you approach your portfolios in that manner, instead of this ego driven, manically bastardized version of instant-gratification or die, you will do just fine.

First, let me reiterate my approach to my $HABT position. When they came public I said this was going to be a long term position of mine, that I’d buy it once per month for 12 months. Having said that, I have about 8 months left of buying to fill the position. Despite my enthusiasm for the stock, it is in my best interest for the stock to be flat to down, especially as the company executes on numbers.

Both earnings and guidance exceeded expectations, helped by an additional day in the quarter. Wall Street’s response has been negative, sending the stock lower in after-hour’s because the numbers weren’t break out.

That’s okay.

There are two things keeping margins down.

1. Price of beef.

2. Rise in minimum wage in California.

Given the collapse in commodities, it’s only a matter of time before beef costs sink lower, helping the company with inputs. The minimum wage issue will abate, as the company diversifies outside of Cali. They have plans to open more than 25 stores in 2015, many in NJ, DC, Nevada and Florida. Numbers were tempered as the quarter dragged on because they were recently featured in a Food magazine for having “the best tasting burger in America.” Naturally, this free endorsement helped boost sales, which will of course wane as time passes. Nevertheless, the core to the Habit/Shake Shack thesis remains intact, which is to destroy the MCD-Burger King hegemony on fast food hamburger consumption.

Playing casual dining has been a very lucrative place to make money over the past decade. This trend will continue, especially with lower fuel and commodity costs.

Making money in proven themes, like the sale of hamburgers, is fairly straight forward. As store openings accelerate, so will the share price. We’ve seen this play out over and over again in CMG, PNRA, BWLD, SONC and even YUM.

HABT intends to double its footprint over the next 4 years. Based off current guidance, the company is trading 4.5x 2015 sales, a discount to CMG’s 5x sales and way under SHAK’s 20x sales. I don’t like my chances at making money in HABT over the next 4 years; I love it.

Terrible day in stockville. Breadth is abysmal and losses are mounting, except for players in the world of medicine.

Up on takeover rumors after canceling an event, shares of ACAD are through the roof. This name has a lot of important biotech investors in it, like Baker Brothers–who owns more than 20% of the stock. If you’ve been following along, Baker Bros just made a killing in PCYC. Their other two large positions are GEVA and SGEN. I am long the latter. Aside from that glimmer of respite, everything else is acting rather medieval, with marked exception to REITs–up thanks to rates going lower.

So, let’s summarize.

Economy good: rates rise, banks go up thanks to yield curve, REITs, Utes suffer. If rates go too high, market throws tantrum and tosses everything into the sewer pipe.

Economy milquetoast: QE is a possibility, yields are down, REITS, Utes thrive. Stock market rips to new highs.

Economy bad: QE is all but assured, yields plunge, then maybe rise off sovereign debt fears. Stocks initially rise off QE prospects, then plunge after idiots gather around a fire and declare “The Fed has lost control” and we’re all fucking doomed to depression.

If you can fit your trades into those themes and where we are now, with respect to these idiots cycles, you will make a mint.

In summary, Wall Street is like a story of three little bears playing out. They hate hot and cold porridge and love the “just right” medium type. Without question, Wall Street is filled with a bunch of drama queen drug addicts, who don’t know their ass from elbows when it comes to knowing what’s best for America. To denigrate positive employment numbers because the proverbial punch-bowl might be taken away is reprehensible. Then again, humans are a disgusting breed of life-form.

We will reach a place of equilibrium soon, an oversold condition in these markets. The PPT will tell you when it happens and we will act upon it. Anything more than that, at this point, would be idle guessing on my part.

Yes, I am selling into the hole here. The very last thing on the fucking planet that I intend to do is repeat last year’s fuckery. As such, I am merely taking precautions, cutting some losses, booking gains.

I sold out of FMSA, EMES, FL and some SLCA.

I have sell orders in for a few other names, with an intent to raise enough cash to allow me to eat yams all day long and talk shit on the computers.

We can talk about the reasons why stocks are plunging to hell this morning; none of it matters. All you should know and care about is there are more sellers than buyers today and the tone of the tape has changed.

Once per month, we get these sell offs. People get all worked up in a frenzy and fuck themselves inside of idiot stocks. Bear in mind, we are in the midst of an epic bull run, one that has lasted for six years. Each and every sell off has been transient, temporary phenomenons that are met with unchecked, wild-eyed, buy programs–fueled by cheap money and strong liquor.

The very idea that the Fed might hike rates is hateful to most Americans. We want cheap money, strong booze, and fast cars. Austerity is for conquered countries, like Germany and Greece.

Bottom line: Don’t laugh off the sell off just yet. Examine it closely and do what you need to do to protect your assets. Being emotional about money is always a good way to lose it.