Can You Smell What the Market is Cooking?

It has the distinct smell of ursine. As the masses obsessed over the second coming of World War 2, with USA v Germany soccer action, the market asserted itself, led by a wide pastiche of high beta chinese lottery gambling degenerate stocks, the sort of things one buys for his grandmother–on margin.

Over this period of time, “The Fly’s” winnings have expanded, encroaching on what I like to call “a day of sheer, unadulterated, winshippery.” Now you have every right, as a man and member of the society of humans, to bet against the tape or wallow in a miserable cash position. But I am telling you here and now, as sure as I am sitting on this chesterfield couch typing away: this market is about to wheel in the penis guillotine into the city square for swift and immediate action against enemies of the state.

To be short is the same as being a terrorist and you shall become wardens of the state.

Pay for your sins now and get long, get very long, else face the consequences of your inbred driven actions.

Gentlemen, we’re back inside of the meat grinder, the sort of sordid market where everyone loses. Thank the heavens that I am not part of your occult clan, as I have skipped the meat grinder line, in favour of the beer and pretzel one. The majority of my top holdings are up, see, so I really don’t have much in common with you.

I believe CJES was acquired by NBR; but now the stock is down. I don’t even want to look at the news, for it makes my brain hurt.

What’s important to know is the melt up in chinese burrito lotto stocks is real. I believe that is TEDU approaching 14 dorrars now, is it not?

On Jupiter’s Stone, both LEJU and TSL are heading much higher. I’d also like RUBI to recover. However, we cannot get what we want, when we want it, how we want it, all the time. The truth of the market is, we are enduring a phase of consolidation. The only sector that appears to be immune to the trials and tribulations of the fribble-minded investor is gold, which is why I haven’t taken profits on CDE.

Top picks: LEJU, TSL, RUBI

You can stop shorting stocks now. You’d be all the wiser for it.

A weaker economy means the Fed will slow down the tapering. I realize many of you insist to believe the economy is doomed and unsustainable, and all of the other things taught at Tea Party rallies, by people with junior high school reading credentials. But here is what is really going on, unvarnished and without subjectivity.

The stock market is the economy, literally.

During the crisis of 2008-2009, the government learned that if the stock market goes, so does the country.

The Fed will support the economy, through the stock market forever.

The Fed would appreciate it if the bond market could function without them. Hence, they are ‘tapering.’

If, by chance, the stock market should go down more than 5% in a short period of time, the Fed will pay attention.

If, by chance, the stock market should go down more than 10% in a short period of time, the Fed will intervene.

 

There you have it. Taper or no taper: the Fed is the buyer of last resort, the proverbial bid in this market, forever. Arguing against these facts and taking long term bearish positions is a waste of time, since you and I both know that the game is rigged. The most dangerous games to play are the ones that are unfair. If you insist on playing it, you could at least side with the rig-er and not the rigee.

I was up 0.82% today.

Added a little to LEJU. It’s very thin, so be careful.

So the economy collapsed by 2.9% in the first quarter–absolutely hilarious. I am telling you it was the snow. Anyone who lives in the United Steaks knows full well that nothing moved during the winter. It was that bad.

So here we are, post apocalyptic GDP revision, and the markets are up. How frustrating, if you are a bear.

The refiners are getting knuckled down because we are now allowing crude to be refined outside of the US. I’m not sure if this is a one day event for the refiners or not. Either way, I have no interest in adding to my ALJ position. It’s a good thing I didn’t buy more of it. I was very tempted to buy more of it yesterday, but held back because of how weak the stock was acting.

It’s a mixed tape. Once again, silver and gold are rock solid. Oils look pretty good, especially transport plays like GLOG and GLNG. Select chinese stocks are ripping, like TOUR (I was gonna buy that too).

Truth is, in case you haven’t noticed, I swapped out of my conservative ideas–back into high beta stocks, in an attempt to make it all back, sooner rather than later. This might set me back a few months, or expedite my return to grace. It’s a rather high risk move on my part, especially since I was doing so nicely. But I get the sense this market isn’t done going higher, so I intend to milk her for all of her milk–as rapidly as possible. I’d attach machines to her nipples and draw milk 24 hours per day, if I could.

Oh, by the way, forget about raising interest rates, whilst the economy is clownishly falling by 3% per quarter. You people make me sick.

There was nothing distinguished about that tape, that rabble that just dropped rocks on my head. There I was trying to have a nice meal, celebrating my daughter’s elementary school graduation, and BAM! the market tumult returns with a vengeance, boxing about my chin and nose. Why, just this morning I was crossing the Rubicon, on my way to sack large cities, make slaves of my enemies. Now the Iranian revolutionary guard occupies my house and they’re making me convert to Islam and hate the stock market.

I was partially saved by RUBI being green. But let’s be honest, today was a fucking meltdown of epic proportions, Chernobyl 2.0. I had so many higher stock prices this morning and now I have a leather whip to my face.

To remedy this situation, I’ve prescribed large quantities of wine (trust me, I am a Doctor, god damn it).

It feels like a Friday to me. Much to my chagrin, this market will open tomorrow and most likely defecate onto the faces of all of those who were climbing the wall of worry for the past 5 weeks.

I lost 1.4% today.

Adding to my Rubicon collection (RUBI), I bought an old favorite RBCN, based off a number of reasons, none as powerful as the specter of an immediate melt up thanks to an aggressive short squeeze.

NOTE: I sold out of ACE.

This is the type of market that hunts down short sellers and skins them alive. There isn’t a respite in sight, as these men of undistinguished cloth get vanquished from the field of battle. We all know the stocks that have moved: FEYE, TSLA, WDAY, SPLK etc.

But what are some heavily shorted stocks that haven’t quite moved yet, but might? After all, even the old Que Pasa.com (MEET) is ripping tits today.

Here are my top 5 favorite possible short squeezes.

CZR

ANGI

SFUN

ZU

NMBL

UPDATE: I am adding RBCN to this list.

Now that the market is back, I am sure our trusty investment bankers will take it upon themselves to toss a whole new slew of IPOs and secondaries onto the the (extra turrets syndrome) plates of their clients. With regard to biotech, be especially mindful that the vast majority of these companies lose tremendous amounts of money, as they are nothing more or less than funded laboratories stocked with scientists who don’t give a shit about the stock market. These nerds need to buy new Bunsen burners and flasks. They will raise capital into these ascent.

As for the IPO market, I’ve never met an investment banker who didn’t want to bring a company public. I do believe, however, the market can handle a certain amount of new issues, but hopefully not too many–else dilution will affect the market. These slugs are encouraging their brokers to flip the IPOs for quick profit, all the while they lure you, the internet sucker, into the sand trap.

Be mindful of the sand trap for it is filled with murderholes.

As for me, on this glorious day, the last day of school in NJ, I look forward to making some money. What else am I to do?

I sold out of SGEN and PRTA, since smaller cap biotech has fallen out of favour. I booked a 5% gain on the former and a 2% loss on the latter. Moving on, I bulked up on RUBI and started a new position in LEJU, since tech continues to move higher. I like recent IPOs that trade below their offering price. It gives the market a clear target to shoot for.

I also put some new money to work, ear marked for long term holds. I won’t bore you too much with the details, as I do not intend to move those positions around for a very long time.

The market had every reason to sell off today, but it didn’t. There is a clear bid in this market and risk is certainly back. I particularly like those ‘roach motel’ type stocks, low volume, small float, high short percentage names, that were nightmares for longs when the market was going down. Now that the market is in short squeeze mode, expect to see those stocks gain volume and traction. Again, my favorite is RUBI. I like LEJU too, especially since Tencent owns 16%; but I haven’t had a chance to see it trade for too long.