Do You Chase Gold Here?

All of the ‘good news’ coming out from Iraq is lending a hand to the rout in stocks today, which is also helping out all of the doom and gloomers in bloomers long GLD. Nonetheless, there’s a choice to be made here.

Do you remain long, weathering the storm and hoping we’ll be back to business as usual again?

Or, is it time to shift away from tech, biotech and overweight energy/gold?

Or, would you be chasing the energy/gold trade here, sort of a sell on the news scenario?

One thing is for certain: the gold and silver trade has been the best trade of 2014, thus far. It’s amusing since it was the worst trade of 2013. That goes to show you, just because a sector or a stock is down and everyone hates it, that doesn’t mean it’s not a solid contrarian bet.

Here are the biggest losers in the gold space over the past year. Perhaps they have the biggest upside potential now.

NAK
DRD
ANV
GORO
BVN
GFI
TGD
TRX
RIC

The biggest silver losers.

CDE
AG
HL

Industrial minerals

AAU
AXU

Conversely, do you buy the airlines here, down more than 5%, off this move in oil?

I sold out of GIMO for less than a 2% loss (I have zero patience for underperformance these days) and swapped those dollars in the retarded shares of TSL.

Is anyone surprised that LULU is getting its big, fat, Canadian face bashed in this morning? Who buys that crap, anyhow? I remember when I used to buy my wife exercise clothes there and walk out feeling like a god damned idiot for spending $250 on three articles of clothing, some of their shit having seaweed in it. Like that’s a reason to spend $100 for tights.

PFfffff.

But the big, overarching, trend for retail is really death and destruction. It’s in a virtuous spiral of deflationary angst, whereby they keep throwing chinese stars at one another, begging for market share gains. When you go to the mall, it’s one sale after the next. Very rarely do I pay up for stuff anymore. Thank God my wife isn’t a vacuous hell hound who needs $2,000 shoes and $10,000 dresses. I actually have to tell her to spend some money for quality at times. Her typical response is “a dog will look like a dog, whether in a $2,000 dress or a $20 dress.” Amen to that.

S&P futures are slightly lower. The US consumer is looking for deals and the super rich, the ones who’ve been holding up retail for the past 15 years, are definitely spending less. I once read some data that suggested the top 5% of the wealthiest people in America make up for 70%+ of retail sales. What an absurd predicament to be in, if you’re running a sweat shop like LULU.

At the end of the day, Canada loses, all the time. Always remember that.

Out of all of the liquid Chinese stocks on the market, TEDU is the cheapest, sporting gross margins in excess of 70%, price to sales under 1.2 and a growth rate in excess of 60%.

I am holding until $15.

Sifting through the trash, I also like LEJU and KNDI.

The term speculation gets such a bad rap from snooty value investors, older men clad in burlap frocks who wait 5 years to realize the upside in their investments. They like to deride speculators as gamblers, people who carelessly toss money into the wind whilst drinking large vats of red bull. I do not harbor any bad feelings towards the blackguardly peasants who meander in and out of my equities, for they provide me with liquidity. All of you value investors are now sucking from the end of a boot now, as high beta biotech names defy reason.

From the perspective of money management, speculation is a cardinal sin. Regulators are quick to label it as “churning” and compliance officers are fast to judge portfolio allocation models. If you are trying to raise capital for a hedge fund, it will be exceedingly difficult to accomplish if your investment style is susceptible to large draw downs. Everyone loves the value guy, cleverly making 10-20% per annum, never rocking the boat, always making himself a fortune.

I believe there is room for both value investing and speculation, with a portion of assets dedicated towards longer term thinking and a smaller swath of cash directed towards price discovery.

I’m up nearly 20% in TEDU and the trade hasn’t settled yet. I made 35% in XON and the stock is still running higher. I’m up 10% in DRNA and I bought it yesterday. I did all of this through speculating wisely. I wasn’t guessing when I bought them. I had an idea about where money flow was heading and I got in front of buyers–plain and simple.

Now this round of speculation might be coming to an end soon and many of my positions, like ANGI, SGEN, TEDU, DRNA, AEGR and GIMO might come under some selling pressure, placing yours truly back into the penalty box. Over the past month or so, I’ve managed to reduce my year-to-date losses from -37% to now -22.5%, following today’s showing. But these are the risks one takes in order to attempt to achieve greatness. Had I left my portfolio stuck in PG, KMT and WCC, I’d still be down 32% now, punching holes into the sheetrock for missing this run.

The market is the sum total of a sundry of investment strategies displayed in real time. Just because some people choose to rip in and out of stocks based upon non-traditional Graham-Dodd investment methods, that doesn’t mean they’re road slobs–booze hounding about Wall Street fixing to blow up his savings account.

I am happy to be speculating again and doing it with the panache and decorum befitting of a top hatted, sword swinging, gentlemen of the 33rd degree.

TEDU ripping tits to the upside.

Indeud.

Which is why futures are sharply lower this morning.

In light of Virginia ousting the republican “leader”, Eric Cantor, with someone who’d like to convert America into a theocracy, smart people are betting that this is bad news for the GOP. See, there are two types of GOPers. There’s the guy with the American flag, ignorant as hell, shotgun in tow, screaming about illegal Mexicans, terrorists, and how the fucking Christmas tree should be considered a holy symbol. Then there’s the guy at the golf course, checkered pants, cigar in tow, interested in tax cuts, loose regulations and a strong military.

The problem with the GOP is that both of these guys hate each other. The party should split, one could name themselves “The Confederate Tea Party” and the other keep the name “Republican.” Either way, a two party system is certainly better than a one party system, which is what we’re heading for soon–should the GOP continue the path they’re on.

In other news, ANGI caught an upgrade this morning, as well as AAPL and AMZN. A slew of biotech stocks are up and SYNA is doing it big.

Bottom line: Our corporate tax rate is an absolute disgrace. It’s too high and just about everyone I know, both GOP and democrat, agree that it should be competitive with other first world nations. The loss of Cantor in a primary spells doom for the GOPers, as they shift right and away from winning national elections. While many backwater confederate states might want a theocracy, electing men who romanticize over WW2 and bygone eras, the majority of the country just wants to work and live happily ever after. The economy desperately needs some checkered pants republicans to seize control of the party and get these tax rates down. However, as of now, it looks like you’ll be hearing a lot more about Christmas trees and gay marriages instead.

Using an insider transaction tool in The PPT, I am able to screen for biotech’s that have been undergoing insider buying. I never put much credence into insider sales; but I always pay attention to when they’re buying.

ACAD: 3/5/14- Baker Brothers, 526,000 shares @ $28.50

ALQA: 4/14/14- Celgene, 714,000 shares @ $7
5/13/14–Brian Posner, CFO, 3,000 shares @ $6.92

AEGR: 5/20-6/3/14- Mark Beer, CEO, 66,400 sharesbetween $30.53-35.31

GEVA: 4/23/14- Baker Brothers, 56,000 shares @ $65.10

NNVC: 2/18-2/20/14- Dr. Anil Diwan, Chairman, 50,000 shares between $3.30-3.80

INO: 4/2-4/15/14- Dr. Joseph Kim, CEO, 28,750 shares between $2-9
11/13/13-Morton Collins, director, 63,625 shares @ $7.28

NVAX: 3/25/14- Stanley Erick, CEO, 10,000 shares @ $4.27
3/25/14-Richard Douglas, director, 50,000 shares @ $4.33
3/25/15- Barclay Phillips, CFO, 4,000 shares @ $4.25
3/25/14- James Young, director, 25,000 shares @ $4.47

VSTM: 5/13/14- John Green, director, 1,000 shares @ $7.74
5/13/14- John Pachter, director, 1,000 shares @ $7.62
5/13/14- Robert Forrester, CEO, 1,000 shares @ $7.62
5/14/14- Dr. Westpahl, Chairman, 2,000 shares @ $7.56
5/15/14- Dan Patterson, CBO, 1,000 shares @ $7.47
5/20/14- Richard Aldrich, Founder, 1,000 shares @ $8.37
5/30/14- Tim Barberich, director, 1,000 shares @ $9.90

CPRX: 2/5-5/19/14- Charles O’keefe, director, 25,000 shares between $1.81-2.02
2/7-5/21/14- Patrick Mcenanny, Chairman, 50,000 shares between $1.82-1.89
6/4/14- Dr. Steve Miller, COO, 100,000 shares @ $2.17

CORT: 5/9/14: David Maloney, director, 100,000 shares @ $1.85
5/9-5/12/14: Daniel Bradbury, director, 138,925 shares between $1.79-1.83
5/9/14- Leonard Baker, director, 100,000 shares @ $1.84
5/9-5/13/14- Joseph Cook, director, 200,000 shares between $1.79-1.84

CYTX: 6/5/14- David Rickey, director, 30,000 shares between $2.32-2.35

FCSC- 6/4/14- Randal J. “fucking” Kirk, 400,000 shares @ $2.90
6/4/14- Kevin Moore, director, 4,557 shares @ $2.99
6/4/14- Marc Mazur, director, 5,000 shares @ $2.90
6/5/14- David Pernock, director, 12,500 shares @ $2.95
6/5/14- Chistine St. Clare, director, 10,000 shares @ $3

SGEN: 5/14-6/9/14, Baker Brothers, 1,068,826 shares between $34.10-38.96

OPK: 1/2/14-6/6/14, Dr. Phillip Frost, Founder and CEO, an immense amount of shares and often, from the $7’s to the $9’s

SNTA: 4/11/14- Bruce Kovner, director, 1,250,000 shares @ $4.02

It’s still a bit jerky out there, with only 40% of stocks higher today. But of that 40%, there was a wide array of winners, indicative of speculation.

This is good news for the markets. If you were injured during the recent downtick in homosexual stocks, like FEYE and SPLK, clear your heads and get with the program. There is money in these here hills. You just need the balls to go look for it.

For the day, I made back another 0.5%.

Large capped biotech are selling off, as well as the oils–paving way for a huge wave of unchecked degeneracy in beaten down tech and small cap biotech. Across the board, small cap biotechs are screaming higher. My sales of JAZZ and SLCA could not have been timed better.

Aside from DRNA, AEGR and SGEN, I really like OSUR, HALO, SGMO, KIN, ACHN and CLDX, to name a few.

The going is good. Make sure to get some.