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
22,417 Blog Posts


The past month I’ve been fucked on a level that is unbelievable. Not only did I miss out on the rally, but I’ve also been stumbling onto a sequence of rare events as if said events were designed especially for me.

Last week I caught a 80% down move in VRAX amidst 13 trading halts. I ended up selling for a 45% loss.

This week I was entreated to an out of nowhere 20% decline in NA, after the NASDAQ told them to fuck off.

And today I opened down 40bps only thanks to a 15% hedge in LABD, which opened up 8%. I sat and watched it sink throughout the early morning and then the markets tanked so my LABD fortunes improved. In preparation for selling it, I first sold a few biotechs I owned and next thing out of the blue — PFE bids for GBT at a 45% premium and LABD goes from +2% to -7% in a matter of minutes.

You’d think biotechs would fade a little after this, but no it continues and I’ve seen this before — me being cursed and all. I will be trading extremely small next week in order to reduce the various ways I could get fucked. If there is a rare black swan event lurking in the shadows, I’m sure I’ll find it.

This is a most unfortunate series of events and I’m now down about 10% off my annual highs, enough to warrant some serious circumspection.

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It’ll likely reverse lower after I post this but since then open everything has been bid higher, in particular the oils, especially of the SHIT varietal.

There’s all sorts of reasons to buy stocks off confirmation that job losses are a fiction. Think about it, who’s gonna stop us? We have been told for a decade we couldn’t even think about higher rates, for fear it would CRUSH the economy and here we are thriving.

The NASDAQ has shot up 200 since the open but still down 15. Many sectors are up and running and in order to stop them, we’d need some sort of late day collapse and/or another fickle reassessment.

Looks good, for now.

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+528k v 250k on the jobs front and markets panicked because the Fed hikes haven’t destroyed the economy yet, which means inflation is here to stay. This means more hikes and because of that traders are BIG MAD.

You might be thinking “wow Wall Street is evil.” You’re not wrong. But then again, Wall Street is only a pure and transparent reflection of who we are, a people who eschew disease cures over treatments and higher unemployment during periods of hot CPI numbers because it disrupts our portfolios.

The good news is the economy is doing fine. The bad news is the Fed has to destroy it.

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It’s over for you bears. I was with you in spirit and with my money. But it’s over. There are a slew of movers to the upside this evening based off STRONG consumer spending. This is all the market needed to see.

Lyft beats by $0.17, reports revs in-line, adjusted EBITDA of $79.1 mln, easily exceeding its guidance of $10-$20 mln

Cloudflare beats by $0.01, beats on revs; guides Q3 EPS in-line, revs above consensus; reaffirms FY22 EPS guidance, guides FY22 revs above consensus 

DoorDash misses by $0.32, beats on revs  

Block beats by $0.02, beats on revs 

Carvana misses by $0.37, misses on revs; continues to expect a return to >$4,000 total GPU and significant positive EBITDA in FY 2023

Yelp beats by $0.12, beats on revs; guides FY22 revs above consensus

Expedia Group beats by $0.40, beats on revs

Block beats by $0.02, beats on revs


Today’s highlights were all biotechs, up 4% for the session. It seems, as unbelievable as it might be, the rally will at least continue into tomorrow. God willing, sometime soon, we can get back to sharply higher energy prices and much much lower stocks.

I finished 85% long, 15% short via LABD.

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People are selling FCF generators and dumping the cash into most down stocks YTD. This is abundantly clear. Looking at growth names down more than 40% for the year gives us a pool of stocks 150 deep and they’re up 11% the past month.

Some of the more notable names include: META, PYPL, NFLX, TEAM, SQ, SHOP, SE, WDAY, ILMN, and ALGN. The median loss for these stocks is -55% YTD.

So when you put those losses into perspective and then cast a curious eye on the 11% gains the past month, one should be suspicious that the recent rally is and could be anything but a dead cat bounce. We are now led higher by cash burning biotechs — because markets are trending up and perhaps the market is suggesting capital markets could reopen for these cash starved scam artists.

For the session, the pool of stocks I mentioned above are down 1%.

Losses are led by RVLV, YETI, and CROX — all consumer names.

In summary, the market has been rotating out of oils and into consumer names based on the idea that the economy isn’t so bad. However, all of the consumer oriented names are now getting DRILLED after reporting WORSE THAN EXPECTED earnings.

You do the math.

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Pardon me for interrupting your day with more commentary. But I must opine — the calamitous drop in the oils has little to do with the war in Ukraine being a non-event of things in Russia so desperate — they’re selling oil cheaply to India who then is selling it back to Europe — because tricks. I still believe, in spite of what the markets are doing, the market is also pricing in a sharp decline in global growth. Even though Chinese stocks are up today and everyone is merry and gay, there is a pricing mechanism in oil that is abundantly clear: SLOWER GROWTH AHEAD.

This is why we are also seeing a WEAKENING of bond yields. Since inflation has been defeated, the Fed can stop hiking and also being cutting rates.

All fantasy.

But what I wonder is — are the oils done going up?

Above is a seasonality chart inside Stocklabs. You can clearly see oil is very seasonal. This is data stretching back 40 years. Oil does not go up in the summer and the fall. Oil goes up, traditionally, in the winter and again in the spring. Once the diving season is upon you — it’s already too late.

Now I am not suggesting you should sell your oils here. As a matter of fact, I like their values. But don’t expect grandiose returns unless something tangible happens in Europe that causes a supply disruption.

The pricing of energy is correct because that’s what the market says. Arguing against the market is almost always a losing proposition. At times you can trade ahead of the market; but generally speaking — following trends is better and more conducive with being a normal person in society.

For long term accounts, having 10-20% of a portfolio in oils and/or other commodities is mandatory for balanced accounts. But the trade now and has been for the past two weeks: long the consumer because the world isn’t ending yet.

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What a wonderful way to buoy your investment. BLK is “teaming up” with Coinbase to provide clients with access to cryptos, whatever the hell that means.

As such, shares of COIN have exploded higher by 30%. I’m not even gonna offer an opinion.

Early going the rotation trade is strong — out of commodities and into consumer oriented names. It’s worth noting the Stocklabs quant expertly exited a heavy overweight oil position 8/1. It’s also worth noting, I got caught short China (which is soaring) and long CROX (who missed) and now find myself DOWN 400bps with a long only book even after booking a 15% gain in XELA last night.

‘Tis the breaks.

I’ll probably hold here and wait.

As for COIN, it’s very nice they cut a deal with a shareholder to rig their shares higher; but I wouldn’t chase it here. Hey, at least they’re not going to zero anymore. That’s the big takeaway here. The absolute doom trade is over.

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Turned on Market Exposure BULLISH — the End is Near Again

I ended down 1.8% for the session. My MTD return is +0.3% and I was DOWN 3.8% last month, while at the same time the Nasdaq has jumped by 15%.

Standard stuff.

I don’t beat myself up about these things, but instead keep going and work through it. No vacations and no time off. I don’t need time to clear my head and I don’t need to relax on a fucking beach somewhere with mosquitoes gnawing away at me. The way I bust out from these squalls is to keep working and keep trading and eventually a light bulb turns on and then I’m off to the fucking races.

Since I have been maligning myself here daily, let this be a stark reminder to you FUCKED FACES in the comments section here and on Twitter — I was +300% in 2020, +215% in 2021 and I am +47% YTD — so before you talk shit to me again and/or decide you are qualified to offer me financial advice — fuck your own face.

I bulked up on strong stocks into the final hour at 106% leverage, ditched two major losers, and kept a 15% hedge via YANG — because China.

We will trade great again. The great whore of the market will suckle us and when we’re done — she will suckled us some more. We will partake in many grandiose occasions for celebratory/festive slurping, as the blackness of this curse wears thin and I bust loose once again to the upside — CASTRATING (pause) my enemies with great violence. There will be periods of time when all seems lost and those who might say “The Fly is finished.” It is at that very point in time when ancient spirits revitalize me and transmorph the bad into the good and I once again ride heavily into the sunset with spear in one hand and severed heads in another — cheerful and happy — knowing I had just won.

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I Keep Missing Big Up Days

With the market down 400 yesterday, I made 1.7%. Now with the NASDAQ +300 and all of the crap rising to the top — I am DOWN 1.4%. The sequence of events that continuously leads me to this abhorrent performance has a pattern. It goes something like this.

Market collapses and my counter-correlation trade works.

Bounces are not trusted, so portfolio is constantly hedged thereby limiting gains on big up days.

Desperate to regain some BPS, often times I will attempt gambits via oversized positions or very small caps.

Due to the nefarious nature of these small caps, they are prone to disaster.

Undergo said disaster and then lose confidence in making resolute decisions about the market, thereby further hampering performance.

Repeat this process for months until a tape I am very familiar with appears and allows me to outperform again.

I had been avoiding the small caps up until recently and was entreated to a 45% drubbing in VRAX and now today a 20% whoosh lower in NA. Naturally, in an attempt to make some back, I bought some small cappers in the hopes of catching lightning in a bottle.

I’m presently 45% cash and I doubt I’ll jump in here with the NASDAQ +300 and all of the trash +10%, so I’ll sit here watching all of the kids have fun — kicking the can around in the splashing water — as I wheel my ass back down into the sewers to sleep in the dark.

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Rotation Still Underway

While we sit and wait patiently for markets to collapse again, the rotation out of commodities and back into growth areas of the market continues. There is no denying we are seeing RISK ON, with leadership in SAAS, retail, and biotech. My problem with all of this is based on the worldview it’s all nonsense and nothing more than a summer fling.

This morning we have strong moves in anything consumer based, from online vendors like SE to SHOP to RVLV and almost the entire software sector is on fire.

Commodity related stocks haven’t been overtly weak, but just not as poppy on big days and there has been a steady progression down for WTI.

Yesterday all the rage was small capped Chinese stocks, likely due to China not bombing Taiwan and traders just acting retarded, bidding up everything.

PayPal crushed earnings, giving the bedraggled BNPL sector of stocks strong bids: SQ, UPST, AFRM. Those stocks all looked like zeroes a few months ago and now they look solid.

Bottom line: it’s not all doom and gloom, sadly. We must acknowledge constructive behavior when we see it and trade the tape in front of us, not the one we want or pretend exists.

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