The Fifth Reverse Horseman: PACW

I really want to make [[CATY]] the fifth “Reverse Horseman,” but I can’t. I must anoint the morons at [[PACW]] with this ungodly title, who, without doubt, are very busy eating through capital like pacman—as you read this.

Basically, PACW is a play to bet against the California mortgage market, like [[DSL]] and [[FED]]. For fucks sake, they lost $10 per share last quarter.

Look for a dividend cut, as the credit markets worsen.

As for CATY:

It’s a perfect blend of Chinese fuckery and bad California mortgages and HELOC’s. Cathay services the Chinese-American community, in the most egregious fashion—via bad loans.

Basically, on face value, CATY appears to be handling the ‘credit crisis’ quite well. However, I believe they are greatly understating their bad loan exposure. On top of that, the company, egregiously, bought back 2.8 million shares @ $32, in 2007, burning through 92 million dollars.

For now, my top bank shorts are “The Reverse Five Horseman”: [[DSL]], [[FED]], [[FHN]], [[CORS]] and [[PACW]]. Also, I think there is considerable downside in CATY, [[EWBC]], [[CSE]], [[WTFC]] and [[BBT]].

NOTE: Pardon my misstep with the financials, during yesterday’s tape—via buying some. What was I thinking? Aside from [[UB]], I am back to betting against them.

Exclusive:

Finally, I have revealed my identity.

I bought 1,000 [[RIG]] @ $146.87.

Disclaimer: If you buy RIG because of this post, a swarm of locusts will descend on your property, in biblical fashion. And, you may lose money.

“So Spaniard, we shall go to Rome together and have bloody adventures. And the great whore will suckle us until we are fat and happy and can suckle no more. And then, when enough men have died, perhaps you will have your freedom.”

Proximo, Gladiator, 2000

I sold short 5,000 [[CATY]] @ $13.38, 2,000 [[WTFC]] @ $25.93, 2,000 [[PACW]] @ $16.90 and 2,000 [[CSE]] @ $15.19.

Disclaimer: If you sell short the above names, because of this post, your local grocery store will jack corn prices up by 200%. And, you may lose money.

I sold 5,000 [[ZION]] @ $33 and 10,000 [[CMA]] @ $31.80.

I sold out of my stupid [[ZION]] and [[CMA]] positions, for a quick loss.

At the same time, I bought a little more [[UB]]. This is a stubborn trade. I am going against what I believe, which is to kill the banks then urinate on their graves.

I do not like banks. Actually, I hate them. Here I am, like some sort of fucktard, buying them—when I should be selling them short.

There are significant breakdowns all over the sector. From [[WM]] to [[WB]], it looks like the bulls are throwing in the towel, following GS‘s quick “shitting of the shower.”

To hedge my UB position, immediately, I will be selling short [[CATY]], [[PACW]], [[WTFC]] and [[CSE]].

I bought 1,000 [[FTK]] @ $20.10, 1,000 [[RIG]] @ $147 and 5,000 [[UB]] @$44.57.

Disclaimer: If you buy the above stocks because of this post, your neighbor will sell his house to a member of the Russian mafia. And, you may lose money.

I was correct to cover my shorts yesterday, so far. [[GS]] posted a blowout number, but no one seems to care. Foreign banks, like [[UBS]], [[CS]], [[BCS]], [[IBN]] and [[HDB]], are doing well, while stupid American banks suck wind.

The stupid asshats from Utah, [[ZION]], are giving back all of yesterday’s hard fought gains and more, with the rest of the regional bank space. My initial reaction is to “reapply” short positions and bet on the “hammer of slicing and dicing” to befall on the financials. However, for now, I will be patient and wait for the day to develop.

The two stocks I bought in moderate size, [[UB]] and [[CMA]], are not fairing too badly.

Ag related stocks are gapping higher again. I must say, this is getting more than ridiculous. I haven’t seen such insanity since the dot com era. I know the stocks are supported by strong fundamentals, but so was [[CSCO]] circa 2000.

At the end of the day, in my opinion, the only sector worth betting on are oil service companies, like [[NOV]], [[RIG]] and [[FTK]].

The shippers are gapping higher today, led by big dicked gains in [[GNK]], [[TBSI]], [[EXM]], [[DRYS]], [[DSX]] and [[OSG]]. A lot of people think the sector has bottomed. Look for some follow through, especially if shipping rates improve.

Finally, for a trade, [[CTRP]] looks interesting. The stock has been bloodied in recent weeks and looks “bounceable.” And, I like [[PCZ]], up to $65.

Assholes. Like Nike, just do it. Buy the banks or oil will go to $1,000 and you will die.

Hank Paulson, U.S. Banking Bailout Team, Goldman Sachs