Don’t Devil Dog Yourself

One of my favorite pastimes is viewing the idiotic behavior of my peers. Whether at theater, dinner or at Target Corporation [[TGT]] , I enjoy observing human behavior and people with flawed overtones. “Normal people” are boring, but most likely to murder you over the last pair of black socks, size large, at Target—fyi. In general, people are narcissists, always putting their own ideas or causes ahead of others. I especially enjoy when people talk about themselves, as if anyone cared. The same flawed people trade the stock market and think the entire investing world revolves around their actions. You may know who these people are when hearing them say “Oh, I just bought XYZ, watch it go down now. I am such a jinx and fucking gayyyy.”

As I write this, they are tossing their entire accounts into an ideology that is basically a fucking guess. Whether it’s long or short, the crime is the same. NEVER go “all in” based upon what you believe will happen in the market. As a matter of fact, unless you have a serious edge on something, NEVER go “all in” period. I hear people say this (going all in) all the time and it makes me sick. There are no fucking short-cuts in life. If you want to build wealth, it takes time to build an account, through consistent contributions and discipline. Do not be the albatross on your family’s neck, by way of losing the entire family nest egg, because you had a “smart idea” that didn’t pan out. And quit watching Wall Street so much. You’re not Gordon Gekko.

On a separate note, I hate snow. And, if I might be so bold, I fucking nailed the [[TLT]] trade, thus far.

Today is a do nothing day. So go outside and play with some snowballs.

Starting tomorrow, on The PPT,  I will launch my 4th tracking index: Risk Appetite.

The components are all sensitive to the whims of credit, some focused on sovereign debt, others hold muni, corp and preferred stock investments. All in all, it will serve as a great way to monitor credit conditions, from a poor man’s real time perspective, without the luxuries of fancified bloomberg terminals spitting out stupid CDS quotes.

For now, this will suffice.

NOTE: Yes, it will be tracked with a fancy chart and composite technical reading, using PPT’s proprietary algorithms.

The market should have closed near the lows of the day (LOD); but due to men with burlap masks, stocks rebounded and melted higher into the bell. This is exactly the sort of tape that keeps me light and heavy in [[TLT]] aka “The Safety Trade.”

I expect to be back in the market, offering “death-blows” to the skulls of short sellers, by March. All of the “stuff” that keeps me sidelined are hypothetical and, thus far,  have not materialized. However, as always, I will keep my eyes peeled for such events and try to avoid the pitfalls of letting my cautiousness morph into some sort of weird bearshitter disease, whereby my brain distorts everything into a negative light.

This is not some credit related sell-off. As of now, emerging markets, corporate, local municipalities and even California are unscathed. Should you begin to see credit clam up again, run for your fucking lives.

Place all of these close end funds on your little/bullshit monitors:

[[JNK]]

[[EMB]]

[[LQD]]

[[PCK]]

Eaton Vance Insured Municipal Bond [[EIM]]

Let this be a lesson to you clam-fuckers: never fuck with “The Fly”. I speed in space rockets, while you’re in bed, cuddling with bitch-ass stuffed animals. My level of awareness is much greater than yours, thanks to the terrible burden placed on me: I can’t help but to bank tremendous coin in the market. I see what no one else can and hear what you do not want to, mainly because you are tone deaf and you need to listen ever so quietly to hear my music.

This is NOT the beginning of a precipitous decline. Instead, this dip can and will be bought, eventually. For the moment, I am being a pussy, bogged down in [[TLT]] —currently a 12% position. I intend to hold it—at a minimum—through its next scheduled dividend payment (3/1). If the market rebounds off these lows, I shall and will buy some [[VXX]] .

Just know and understand: “The Fly” is well aware of his actions and how a small minded person, such as yourself, might have difficulty in discerning the difference between shit and chocolate pudding. I never ask that you “follow me” into anything. I do this blog thing for sport, in order to vanquish and utterly destroy all other financial bloggers. So you know, I AM ACCEPTING RESIGNATIONS, from whomever can’t handle the day to day stress and anguish (the fucking drama) of calling the shots on these here internets.

Top picks: [[TLT]] , [[VXX]]

Why yes, as I matter of fact I do.

skip to 1:00

He was just off by a year and change.

Carry on.

We are enjoying an oversold bounce. But, in my estimation, there is more downside, in the near term, than up. Overall credit conditions are still good, as evidenced by [[LQD]] and [[JNK]] . However, trading stocks is more of a crystal ball activity, not reading the latest headlines—if you know what I mean.

If you are still heavily long, please, on Salomon’s eyes, raise cash.

Separately, the refiners are looking attractive again, heading into driving season. In that space, Tesoro Corporation [[TSO]] and Holly Corporation [[HOC]] are your best horses.

As for me, well, I will simply pass the time, kicking back in my southern hillbilly made rocking chair, reading newspapers, while sipping ever so gingerly on a nice cool glass of lemonade—not too sweet ya hear. My next move will be to go long [[VXX]] , as I further entwine myself in the business of betting on lower stock prices. One step at a time, young man. One motherfucking step—little leech.

“Bearded Clam” Bernanke tells us we need low rates, for a long, long time. No shit, dickhead. We need low rates because just one year ago today we were on the precipice of total and complete collapse of the modern banking system. Don’t forget, we can still fuck this up, sending us back into the stone age. Forget about inflation; try to focus on the greater evil: deflation.

With my money, I am seriously considering a position long [[VXX]] and short NIKE, Inc. [[NKE]] . The days of the Nike Slave Prisons are coming to an end. Let it be known, no one wears Nike sneakers anymore, not even in Harlem. In all seriousness, the upside is 1-3 points with 10 points down. The Vix trade is a cute way of saying “stocks are heading lower, asshat.”

Thus far, the market is higher, giving my longs a boost. And, much to my delight, my [[TLT]] position is up too. So you know, [[TLT]] is now my largest position by a factor of 3.

It’s time to teach those treasury shorts a lesson or two about this here government. The dark forces of the Grande Recursive Order of the Knights of the Lambda Calculus shall thrust their monetary spears into them, while chewing on gobstoppers and other childish sweets.

Some of my best ideas were never captured because I was too busy being a cheap-ass, trying to get better prints. Or, I had a theory, but second guessed myself and ended up having to claw out of a fucking financial sinkhole. As much as I would love to ignore bad news and kick old/disabled fuckers into active battlefields, I must—PAUSE—here for a minute and observe what the fuck is going on.

Banks are not lending, because they do not have a reason to lend. Why lend to you, when they can buy whole books of business, on the cheap, via the FDIC? Or, they can borrow from the Fed and buy bonds— for an easy, quick, assured return.

Much of this recovery is contingent upon a sharp improvement in employment. I keep fucking waiting for it to happen. However, thus far, all I get is Obama-talkie talkie, with little results.

While it’s true, the printing of money should, in theory, devalue the dollar, hence, leading to a rise in dollar denominated commodities. But, what about the debts? Also, how do we account for European debt? All in all, the market is one big scrambled egg, with fuckfaced cooks throwing shit in the pan— mixing in onions, meat, cheese and now FISH. The fucking omelet, for Uncle Robert the Trading Robot-God’s sake, is disgusting and I want no part of it.

The latest salvo out of the Fed (raising rates) screams desperation to me. I do not see the need for the Fed to raise rates in an environment where fuckers from Ohio are living off government cheese, working at Burger King Holdings, Inc. [[BKC]] . Sometimes it’s important to think crazy; and right now, I’m off my meds.

Let’s assume the Fed knows there isn’t enough buyers for government bonds, throughout 2010. Most people think rates will be forced higher, in order to lure desperate Chinese men back into the fold. Really? Do you really think 1-3% higher is the difference it takes to attract 500 billion dollars?

I think not. This is a political relationship, completely and utterly detached and devoid from performance review.

If the government needs money, you will provide it. They can take it from you, via tax hikes; but no politician wants to do that. Or, they can trick you into lending it to them, by way of convincing the investment community that they need a “flight to safety.” As we know by now, gold is no longer a “safety” trade. It’s more of a reflation trade, very sensitive to the whims of the dollar. The only real safety trade is [[TLT]] .

How low can the market go?

I don’t know. All I know is, someone just threw a giant fish in my fucking omelet and I don’t like it. Not one bit.

If you notice, I am purposely opting to avoid selling short, even though I think the market will trade lower. I am trying to remain focused here and not get caught up with the mixed emotions of being both long and short at the same time. For the day, I sold a little more, upping my cash position to about 45%—putting my current allocation at 45% cash, 45% equities and 10% treasuries.

The [[TLT]] trade is a very simple, low risk, bet. Essentially, it’s like cash, but better. If I hold it long enough, I will receive dividend payments. And, should the market get raped by zombies dressed in burlap, it will appreciate. Unlike past markets and trades, my current strategy revolves around lowering the beta, in order to preserve assets, so that I can buy stocks lower.

That’s the point.

As the European cow-fuckers trash their own currency, ours will appreciate, essentially making [[TLT]] a “safe haven.” I realize this is a 180 degree reversal of my previous prophecies. However, the future is always changing; therefore, I must change too.

Top picks: [[TLT]] , [[DRR]]