iBankCoin
18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
23,150 Blog Posts

ROTATE NOW OR FEEL THE WRATH OF COURRECTION

I have to keep this short, for two reason.

1. I just got back from the pool and need to shower.

2. My kids have their friend from NJ here and I am being forced to see Barbie at 4:50pm.

I have been trading in and out of inverse ETFs to hedge against a long book and so far quite successfully. I am +5bps in an otherwise drab day. I was correct in assuming risk averse was back on the table. I am nearly fully invested now in low beta divvy payers and enjoying the carnage in tech.

My dream, naturally, is for this all to end. This perverted distortion of free market capitalism produced by people who hate me. I’d like very much to see them fail and in doing so make America rise again and become glorious. The interlopers, of course, will be upset by this and if being honest with you — I feel they’ll win because they have the resources and the means. Everyone else, you and me both, are chaff — cannon fodder to be used at their discretion.

There used to be benefits in this global order, when it was benign. But now it’s wholly malignant and I’m afraid the fractures on society are so great, due to the 4th turning, that the only way forward is through the fires.

In terms of professional money management, no one does it better than me. But I do hope you well and for your families to prosper into what can only be described as an acute cataclysm with profound consequences.

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MARKETS COLLAPSE; SECULAR OLD MAN STOCKS IMMUNE TO THE HORRORS

Big move in the 10yr today caused me to stop out of my TMF. Although crashing of rates is a conviction trade for me, the timing isn’t now — apparently. I have no interest in sitting around for things to materialize.

Having said that, stocks are cratering, Nasdaq off by 150+ after a series of earnings reports. For the record, I’m not too concerned. On the other hand, now is a good time to hedge.

I’m mostly long secular stocks now, slow growth divvy payers and they’re all up.

What’s happening is called rotation, out of shit stocks into quality. How long it lasts is an interesting question.

For now 35% cash, 15% hedged, the rest in boring names like MDLZ — but I’m up 9bps unlike you — who are likely roasting inside of hell.

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Decided to Bulk Up in Old Man Stocks

Here is my thesis, at least for tomorrow and perhaps into the future.

Rates will decline, which will provide a benefit to the balance sheets of regional banks. With yields dropping, large cap dividend payers will be bought. This might coincide with overall weakness in the tape — because let’s face it — this market is fucking nuts.

The specter of a reversal to the downside is very much in my heart; but I have yet to see any actual evidence that this is happening. Ergo, before getting short — it might be wise to reduce risk and bulk up on lower beta high divvy stocks.

This is my play.

Tactically, I’m up 3% for July, 49% for 2023, and to be honest have nothing to spend the money on. I will never remove it and really need to get myself a S. Dakota trust ASAP. There isn’t a sense of urgency for me to make 50% more or 5% more from now through Fall. I will, however, impose my will upon any tape that possesses violence.

Good day.

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Gross Margins Matter

If you look at the biggest winners throughout history, you will find them to be companies with very high profit margin. Amazon wasn’t killing it until they started selling cloud services on an enterprise level, which greatly increased their gross margins.

I am going to steer this right back the fuck into Bitcoin and there is nothing you can do about it.

Here are the lowest producing Bitcoin miners.

You see WULF at the very highest margins? Do you want to know how they’re able to achieve it? I’m gonna tell you anyway.

NUCLEAR FUCKING POWERED MINING MACHINES.

While you cunts twiddle your thumbs with windmills and solar panels, the men at WULF are using clean energy that works, via boiling water.

While WULF is small, they’re growing. They produce about 12 BTC per day and there’s a reason why the stock price has been hot. Coming in at #2 on margins is CIFR — again small but highly profitable.

When BTC catapults to new RECOURD HIGHS, you will remember the day I posted this and be grateful for it.

OR, these CEOs of those companies turn out to be criminals and you’ll really hate me.

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Looking for a Guaranteed Trade

My new strategic portfolio is intended to receive all of my best ideas, conviction trades that I often miss out on because I’m too busy trading to and fro. One of my best ideas, if not the very best, is being long US long dated bonds. This trade has been poor and the specter of renewed inflation is always just around the bend ready to grab our legs when we start running. Nevertheless, it’s only a matter of time when we see MATERIAL WEAKNESS in the global economy, from which will bring forth a flight to safety into bonds — cascading yields and general acrimony.

My other dunk shot investment is UBER. People talk shit about UBER — but always use it when in the city. Their brand is unassailable and once they can figure out how to rid themselves of drivers — margins are off to the races.

I am trading extremely light today, since I do believe in my heart of hearts a great calamity looms.

More later, +16bps.

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DISASTER LOOMS *

Inside Stocklabs there was a general sense of entitlement today — with members cavorting around the room feeling grande because markets rewarded them once again with outsized returns. There seems to be some confusion amongst the general populace who feeeeels as if this life is supposed to be fun, filled with passport stamps, and feeding until portly and disjointed.

This is a fallacy.

Life is hard and should continue to be hard. You should work until you are dead and travel very little, especially to places that do not have proper civilizations that understand how to produce clean water.

You have been lied to your entire lives and believe your own happiness is paramount to all and that your legacy should only be that of a jovial person who liked to smoke pot and eat cheese with his wine on a Saturday night whilst watching FOOLSBALL.

YOU SIR are wrong and your disconnect from the natural order of things is what is wrong with society today.

I hedged heavily, bled out by 81bps for the session, as the fats inside Stocklabs poked fun at me and pretended to be smart. I look forward to the reckoning to come and the great many pains that will be inflicted upon those who opted to soften themselves before the fires.

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Trading Out of Pocket

I am not focused on trading today, as I deal with day 4 without proper usage of my right leg. I am now incredibly grateful for once having full motion of my right leg and really would prefer if the Gods stopped clowning around with me and permit healing to expedite.

I had gains — but now they’re gone — down 65bps and I’m fully exposed to the perils of risk. I just had to blow out of both ACHR and JOBY for 4-5% losses — who the fuck knows what’s happening in the flying taxi cab space.

Truth is, I am bored of making money so frequently and stacking gains atop of gains without challenge. What am I doing it for? What in the fuck do I get out of it?

Exactly.

Into the close, I’ll attempt to build for tomorrow. My bias is for a continuation of a commodity run — but this trade has been a very stupid one for quite some time now.

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Russian Grain Deal is Dead, The Freezing of Europe Trade is On Again

One of Russia’s mistakes in the war is not understanding the level of hatred the west has for it. The west blew up their pipeline, sent men and weapons to kill Russians, and yet Russia continued to supply Europe with the materials they needed to survive.

Yesterday’s announcement of the Ukrainian – Russian grain deal ending topped off with missile attacks on the Port of Odessa might elucidate the thinking inside Moscow: total disconnect from the west.

If so, the duplicitous Turks will not be used to transit gas and oil into Europe. And if so, indelibly, Europe will freeze due to lack of natural gas.

This was always Russia’s trump card, but they were too soft to play it. I suppose they wanted their cake and eat it too. But this war has devolved and the rhetoric borders on pro genocide.

Markets are beginning to price this in today, with a major lift in fertilizers, drillers, coal, and anything commodity related. This trade appeals to me incredibly and I’ll be partaking in its bounty.

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NO FEAR IN THIS FUCKING TAPE

Pardon the seedy verbiage in this title — but it must be emphasized there isn’t any fear in this fucking tape in a world rife with risk.

The VIX is now sub $14 and the US/UK/URK blew up the Crimean bridge last night and the Black Sea grain deal was canceled by Russia — and let’s not forget the Pentagon just dispatched a destroyer and F35s into the Straight of Hormuz to check Iran. We also, if you weren’t paying attention, sent more troops to Syria.

It doesn’t matter what side you’re on in this war. Markets have concluded Russia is losing and America is easily winning without fear of escalation. This is perhaps a grave disconnect from reality, which can cause some severe drawdowns if anything to the contrary develops.

NEVERTHELESS, like you, I slavishlessy obeyed the tape and finished +93bps without any hedges into tomorrow. The only difference is, between me and you, I am wholly convinced that doom, or whatever you want to call it, looms right around the corner.

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This Bull Market is Top Heavy

Here are some stats for you.

Stocks with market caps over $100b are -7% on a median basis over the past 52 weeks.
Stocks with market caps under $1b are -55% over the past 52 weeks.
Mid cap stocks from $5 – $50b are -11% over the past 52 weeks.

Generally speaking, the market has rewarded mega cap monopolies and following the previous path of FANG. We had a brief period during and after COVID where small caps busted loose and it left the mega caps in the dust. But that bubble popped and if you’re only focusing on the smalls, you should expect to be disappointed.

Presently I am 45% cash, +105bps, one small hedge.

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