Riding the Silver Bullet

I’ve researched these peak-trough cycles to identify what sectors perform best going from trough to peak and the results are unanimous: get long silver. Both gold and silver represent reflation, as well as “safety.” When the market bottoms, without a doubt, the miners will offer the best returns for aggressive investors.

My favorites are AG, EXK and maybe a little PAAS.

The billion dollar question is “when will the fucking market bottom already?”

It’s hard to bottom when the higher tax ax looms in the balance. I don’t think Israel bombing the shit out of Gaza has anything to do with the PE ratio of AAPL; therefore, it’s irrelevant. I doubt the GOP is going to allow Obama cut a “fiscal cliff” deal. I really believe we’re going over that fucking cliff and crashing into a depot filled with flammables.

But, in the event they do cut a deal, this market is going to rip higher.

I’m not a coal man anymore, so coal and steel are off the table for me. On a bounce, I like tech and precious metals. Tech stocks like CRUS, NXPI, IPGP and CREE are of great interest to me.

We’re in trouble here. We need to bounce now.

[youtube:http://www.youtube.com/watch?v=C0jgZXVSq58 603 500]

Go through the archives, read what I wrote inside of The PPT. You will find that I was expecting this decline and prepared for it by positioning a 50% cash position. As fate would have it, I still bled the fuck out, with SWHC transforming into a knife and stabbing me in the face.

Silver moved higher too, as predicted. But the dicksuckers over at IAG have sucked the life out from the miners (pun intended). As a result, EXK is getting splashed all over the pavement. I’m down about 10% on both stocks and my VHC has retrenched by 10% as well, equalling a situation so bizarre, so asinine, I can only marvel at my ridiculous situation.

I now find myself in the awkward position of having to be an aggressive dip buyer, into what I deem to be a “bear market.” Or, I can just sell everything here and live out the rest of my life in the long grass fields of Romania.

War is on the horizon, gentlemen. Today’s opening salvo in Israel is an appetizer of things to come. It is the ultimate stimulus program and it will be enacted in Tehran.

My sense is we trade down 3,800 points from here, inside of the next year. We will bounce along the way and most of you will be hoodwinked into mercy positions by clever salesmen, circling the grounds of Twitter. I will start buying when my robots say we’re done going lower. Until then, I will bleed, just like you, but my wounds will not be mortal.

http://www.youtube.com/watch?v=LpPdl0StUVs

To replace it, President Obama has declared the old Thanksgiving to be renewed with “government appreciation day.” Look at Katrina, look at Sandy. Without the government, you’d be dead. Without the government, gentlemen, you’d be buying diapers from a store managed by the Taliban.

You should give praise to them for their stock market wizardry and for saving millions of jobs, bailing out your favorite banks and auto companies. Let’s not forget, without government you’d have no food!

Mysteriously, stocks are down today, ahead of government appreciation day, scheduled for Thursday of next week. It is my understanding, through nefarious channels, they (the government) are all buying Facebook today.

Surprisingly enough, I’ve been unable to dodge this fucking market meltdown, despite having 50% cash. I was down 2% yesterday and another 2% today. It’s unbelievable how stupid the world works. It’s like that movie Final Destination. You try to avoid death by locking yourself in a rubber room, then the room itself kills you with oddball toxins.

The sell offs in SWHC, VHC and EXK (silver is up, hello, fuck face) are buying opportunities–but I’m not buying yet. I much prefer buying into a semblance of strength, after a move lower, in an effort to catch upside reversals. Buying into a stock as it knifes lower is risky and Le Fly is tired of risk.

In many ways, I’ve become pussified, trained almost, to fear the markets. When I was a small boy, running about the schoolyard, I thought the stock market was a place of wonder, excitement and opportunity. I felt it was a venue for gentlemen, a place where a poor lad like myself could make a fortune. Well, I made a fortune, but it wasn’t easy. Now I feel like the whole thing is a giant snare, intended to wipe out investors with “Tsunami-like” precision.

The PPT is not oversold yet. It has nailed the top end of the range to the exact date and will most likely nail the bottom, as is customary for the algorithms to do so.

Investors are brooding over this market, on strike, selling everything but FB, CSCO and ANF. I had intentions of participating in a joyous rally today. But it appears my emotions, seemingly enough, were misplaced.

I should be ceremoniously burying this market, declaring it dead, then moving on. Hope keeps the sucker fighting for life, when in fact it is nothing more than an exercise in futility.

I’m rooting for stocks, from a distance, and hope FB can really “save the day.” But we all know what this type of trading action portends and it has nothing to do with cocaine gorillas.

In the meantime, I am researching WNC, another Chuck Bennett winner–and how an upgrade cycle might push the shares to $16. I’ll check in with you later on today, just to see if you’re breathing and if the market has destroyed whatever sanity remained in your person.

http://www.youtube.com/watch?v=ERQzl4xDpXk

My studies point to a near term respite in the market. The CSCO beat will help provide the fuel to light the tinder.

I’m still “bearish as fuck”, but even dead cats bounce when toss off balconies.

I highlighted my thoughts in detail inside of the capstone of The PPT.

In short, we run tomorrow or never run again. Focus should be fixed on tech, especially semis. I am willing to allocate another 20% of assets for short term trades, but nothing more.

As you were.

http://www.youtube.com/watch?v=Wr7FJohm68o

This afternoon I had the pleasure, while noshing on a few almonds, to overhear Mrs. Fly and her “fengshui” expert (who seconds as our cleaning lady) discuss a great many things pertaining to luck and fortune. I learned that the south east part of the house is in fact CURSED with bad luck until February and that “we should move the children out shortly” to avoid such unluckiness. I was, however, happy to hear that my office was in the lucky part of the house and that Mrs. Fly couldn’t afford some luck charm that our “fengshui expert” aka cleaning lady had in her possession–all very amusing to me indeud.

This brings me to my next point. You’re all a bunch of Mrs. Fly’s out there, totally disconnected from what’s going on, devoid of the alertness needed to avoid murderholes. Without me, the lot of you, as well as Mrs. Fly, would be resting inside of one, tending to wounds so heinous, they shouldn’t be discussed in this blog.

I want you to heed my final warning and understand that the government is intent on inflicting damage to you. They will not avoid the fiscal cliff–but purposely drop you off of it.

Top picks: SWHC, EXK, VHC, 50% cash

There is a serious lack of momentum in almost every sector. With exception to airlines, what exactly has been working? Hospital stocks? The market is up today, but breadth is barley above 50%. I don’t mean to rain on your parade. I intend to lash you with lightening bolts and scare you with thunder instead.

I added to both EXK and SWHC because it’s the only place I feel comfortable investing money.

I spent the morning perusing some of the top holdings of our genius hedge fund managers. Coatue and JAT steal the show for dumbest positions ever, saddled up heavy in names like PANL, CIEN, FSLR, CMG, NFLX, NTRI, MCP, SINA, SODA and GMCR.

Tiger Global is up more than 22% this year and they are gambling, long names like PCLN, LNKD, TDG, YNDX, QIHU, MELI, ARCO and DECK.

You’d be surprised how exposed most hedge funds are to beta. If we continue to soften, these glorified gamblers will need to liquidate. When they liquidate, it causes a rippled effect and stocks cascade lower. My theory is the government is dysfunctional and cannot agree on a “Fiscal Cliff” solution. This will erode investor confidence and precipitate a sharp sell off, from already low levels. Once we flush out, the aforementioned hedge fund managers, as well as many others, will be forced to liquidate, else cede their gains and live out the rest of their lives like vagabonds.

As for me, I only desire to buy margin liquidations. I am a man of modest wants and needs, sashaying (no homo) throughout time in a plutonium powered time machine–making investment on behalf of others so that I can afford hand-knotted rugs for Mrs. Fly.

http://www.youtube.com/watch?v=DjRky-ACSJg&feature=related

I added to both my EXK and SWHC positions.

There is a very large group of mega-cap stocks woefully underperforming. Some of these stocks might end up being terrific values, others continue on their path of irrelevancy.

Here are some staggering year to date returns for once great companies.

HPQ -46%
PC -42%
SNE -41%
NOK -39%
DELL -36%
CAJ -30%
CHU -27%
EXC -26%
CNQ -25%
FTE -23%

Of those 10 losers, EXC is of most interest, mainly because they’re not in a dying business and they pay a whopping 6.8% dividend. As an aside, At&t is up 18% for the year and it pays a 5.4% dividend. Hell, I could’ve just put it all on T and wish for the best and I’d be doing just as good as I am now, without all of the headaches and seizure inducing volatility.

The market is opening sharply lower. Stocks like AKS are dead in the water here, having to endure another 4 years of financial tyranny and saddled with a tremendously impaired balance sheet. I have a list of stocks that can “go all the way” to zero, should we fall over “the fiscal cliff” and wallow like fat fucks in vats of butter–awaiting slaughter.