Former Fed’s Warsh Says Fed Should Act Soon to Buy Market Time

Everyone I know hates the Fed, not because they’re necessarily bad people — but because we view them as cheaters — men and women who manipulate stock prices to keep the facade going long enough in order to avoid blow ups. I get why people hate then and I can certainly understand that point of view from a person short stocks into Fed action.

NOT FAIR. They cheated!

But do they have a choice?

Warsh, occasionally rumored to be a candidate for Fed chairman after Jerome Powell’s term expires, spoke Friday morning to CNBC’s “Squawk Box.” He recommended the Fed act as quickly as Sunday to assuage financial markets that have been in an aggressive swoon all week as the virus has spread.

“This thing’s moving pretty darn quickly,” he said. “At the very least, a statement on Sunday night before Asian markets open would buy them a little time and let us all learn a little bit more about where things are.”

He said the Fed doesn’t have a lot of ammunition to help markets and the economy so it needs to act quickly in a coordinated fashion with other central banks like the European Central Bank, the Bank of England, the People’s Bank of China and the Bank of Japan.

“They’ve got a knife. There’s a gunfight,” he said. “You might as well go find some friends that also have knives and see if you can’t to it together.”

They trotted the former Fed governor Warsh out there this morning to tell markets the Fed will be mulling about what to do over this weekend, “in order to buy time” for markets. We have been crashing, worst point declines ever, so I get why they want to stem the tide. Don’t get all uppity and say “there’s nothing they can do this time,” which is wrong. The Fed has no choice but to acquiesce to the demands of markets — because of the debt and the obligations and our addiction to cheap money. So let’s not even bother waxing poetically about the need for a hard reset and how millennials all deserve a strong dose of reality before they start moving into the suburbs to raise their families.

This is a game. You either play it well and try to think like the other person and front run or you play it poorly and obstinately make decisions based upon your feelings. I don’t know for sure when markets will bounce — but it’s coming soon and you best prepare for it. Shorting into the hole is never a good idea and we’re in a deep crevasse now. Exodus OS signal flagged yesterday, representing the technical lows reached during the late 2018 market rout. You remember that one right? Well this tape is as bad as that. We’re presently 28% higher from those doomful days and the Fed is to thank for that — sucking Trump’s dick the whole way to 1.21% on the 10yr, currently down a staggering 8bps.

The losses in the futures market have halved. I woke up at 5am to see Exodus brimming with comments, discussing the latest virus stock to rise 200% overnight. I didn’t even know stocks traded at 5am. What in the fuck is going on here? They’re all up like crazy this morning — massive cleaves cutting off the cocks of short sellers. See them all rise and cause FOMO and then see them collapse.

Virus stocks p/m: $LLIT +22%, $VIVO +15%, $BIMI +41%, $INO +10%, $NNVC +10%, $TRIB +90%, $LAKE +35%, $NVAX +23%, $OPGN +48%, $VXRT +48%, $GHSI +36%, $AEMD +10%, $CODX +17%, $VIR +25%, $APT +38%, $IBIO +102%, $AHPI +110%

— The_Real_Fly (@The_Real_Fly) February 28, 2020

You know what to do.

The sound of blood moving down Wall Street like rivulets was pervasive today. Traders attempted an afternoon gambit, rallying back from down 1,000 to 250. I attempted to partake and bought a variety of stocks, only to end up selling them before 3pm for marginal losses and gains. The delta was not meaningful to me, after enjoying such a glorious session.

What transpired into the close can only be described as capitulation — traders giving up the ghost, deathly afraid of what lurks behind the next corner.

Over 8,400 people in the state of California are under observation for the Coronavirus. Everywhere I look, commerce is being shut down. The end of globalism is upon you, as borders shut and people seize up with fear. The only solution is massive central bank intervention, which might happen this weekend.

I stand before you a very victorious man. My gains capsize your small boat and sink you and your passengers to the bottom of the ocean. I bought several virus plays into the bell, not because I had to or even wanted to make money, but because I found it to be fun. A rather obnoxious excuse for the purchase of a pennied stock. But that is a social construct that is as ridiculous as the traders on Wall Street Bets and their inane options trades gone awry, blown the fuck out like the millennial faggots they are — a cheap and tawdry denizen for low IQ traders to rally together to find enough courage to lose all of their coin in unison.

“The Fly” doesn’t share that culture and only wins, as evidenced by the results found inside of the hallowed halls of Exodus.

Good day to you.

Markets are down over 600, but members of the hallowed halls of Exodus wouldn’t know. We are booking OUTRAGEOUS gains in virus related plays — because I was prepared for this eventuality.

Here are the results of today’s booked trades.

$FNDG +8.4%
$NVAX +15.6%
$NNVC +31%
$RVMD +8.9%
$SOXS +10.1%
$VXRT +95.7%
$TNXP +121%

That’s right. Two doubles for the day. I have a few more on the books, other than that cash.

Good day (tips hat).

Here’s some pre-market pin action for you.

Pre market virus stocks: $TNXP +80%, $CODX +48%, $VIR +20%, $VXRT +25%, $MRNA +27%, $APT +45%, $NVAX +30%, $NNVC +20%, $LLIT +23%, $AHPI +80%, $LAKE +16%, $BIMI +23%

I am long several of these.

With quarantine being extended and school canceled, I like Chinese online education plays. Do some research, pal. I am sick of playing wet nurse for you.

The 10yr is 1.27%, WTI $47ish, gold higher. It is fucking over.

European markets are barreling lower, almost by 3%. Brussels is off by almost 5%.

I stand before you a very victorious man.

I don’t give a shit how you feel about Trump — this is some stupid shit. Incredulously, and in the midst of a pandemic breakout, Trump placed VP Pence in charge of the coronavirus response in America. What in the fuck is going on here?

I’ll tell you what’s going on. Narcism. This is how rich people act. When faced with an issue that is inextricable, they find fall guys — someone to shit upon. If Pence does good, Trump is a genius for appointing him. It’s all bullshit and people know it. He announced for a surprise meeting at 6:30pm today to discuss the virus. His plan was literally shit upon by Wall Street and now we’re really reeling.

Dow futures are OFF by 315, Nasdaq raped for 125.

Over in Germany, futures are lower by 2.4% and hilariously, Chinese equities are HIGHER by 0.4% — because that entire country is a scam.

The news is all bad, with breakouts all over the world, especially S. Korea and Italy. More specific to market stress is WTI and Brent crude, now crushed to $48. This will soon manifest itself by way of credit ratings and potential defaults for the oil sector.

Needless to say, we need some reflation and we need it soon. Do not be surprised to see the Fed ginning up some scheme soon. I sleep tonight with nearly 50% cash, short semis and FANG and long a shit load of virus stocks — but I too know this market rout can be suspended at any point in time with one presser from the Fed. My actual sense of the matter is, we deserve to trade lower by at least another 10%. Under those conditions, there is an enormous amount of money to be made short semis.

See you in the morning.

Listen to me. This isn’t going to be one of those obnoxious posts where I wax poetically about my gains. I merely attempted to do that on Reddit today with the FAGLORDS from WSB and was entreated to a sundry of “prove it with screen shot” requests. Truth is, I don’t care if you believe I made a fuck load of money on these ideas or not. None of that is really relevant. The size of my cock has nothing to do with the quality of woman I keep.

But I am in a zone, totally and completely prepared for the chaos you see enveloped around you. I prepared for the coronavirus weeks ago and did the research and know what the people want — because I run a very big and popular trading room in Exodus.

Sure, on occasion, these stocks break and halt and trade sloppily throughout the day — but the results are what they are and I am here to genuinely help. It’s not selfless of course. I am 75% through with our next iteration of Exodus, dubbed StockLabs. Go sign up for a beta trial now.

I quit managed money in order to pursue my dreams of running a legit data analytics platform for traders and I’m almost there. With my expertise in capital markets, I of course intend to leverage that to boost sales, which in turn will bootstrap me to scale operations and completely dominate the space. But that’s a discussion for a later day. For now we will discuss my positions and I will give them to you now.

My trades today.

MRNA +14%
AHPI +52%
AHPI 28%
CODX +37%
CODX +30%
LAKE +10%
DAO +5.2%

Plenty of Exodus members did much better than me today, especially with VIR and CODX positions.

And here is what I like into tomorrow.

TNXP
LLIT
NNVC
NVAX
SOXS
FNGD
STMP

I’m 45% cash too, so I have room for error and to average down if need be.

Ciao.

Today’s score.

sold $MRNA +14%
$AHPI +52%
$AHPI 28%
$CODX +37%
$CODX +30%
$LAKE +10%
$DAO +5.2%

I can’t think of a time when I had more successful trades like this in my entire trading career. Some of us dissipate and get BOGGED the fuck down. The rest of us flourish.

Both AHPI and CODX were doubled sized positions, which is why the duplicate. Trades all done in real time inside Exodus.

Yesterday amidst the early morning splendor, bond yields got hit and I new it would sink stocks. Today is a different story, with the 10yr +3bps. We can bounce today.

The only caveat is oil, presently off by 1%. It needs to lift.

Also, the good folks from JPM have all but considered the virus to be something akin to a temporary phenomenon and have declared China will grow 15 fucking percent in q2.

China’s economy will bounce back from the coronavirus and grow 15% in the second quarter on a quarter-on-quarter, annualized basis, JPMorgan Chase’s Joseph Lupton told CNBC on Wednesday.

Lupton, a global economist for the bank, said on “Squawk Box” he is projecting negative 4% growth for the first quarter, when the coronavirus outbreak brought much of China’s economy to a halt.

“It’s not just looking at things still depressed. It’s looking at where the bottom is and are we starting to march our way upward?” Lupton said.

Lupton said 15% quarter-on-quarter annualized growth could be possible, in part, by the depths of the first-quarter decline. “If you get a rebound that’s happening, even if you’re still down 30%, if you were down 50%, that’s a 20 percentage point move that actually starts to impact growth not just in the second quarter but even in the late first quarter,” he said.

Fuck off and whatever.

Virus stocks are higher in the pre-market, but they usually trade lower with stocks higher. It’s a fluid situation, as always. Just find solace in knowing China’s GDP is going to grow faster than ever soon. Super cool!

Market closed down nearly 900, yet I found myself liquidating stocks at 50% gains. See pal, that’s who I am — simply sashaying throughout life win after win after win. I make it look easy.

Into the close, I loaded up and doubled up on virus stocks. I also re-bought SOXS — because that’s what men do during periods of uncertainty.

I am not looking for a full blown 30% crash, just a modest 8% lower to December 2019 levels.

Be afraid. Soon the virus will be here and markets will seize up because commerce will grind to a halt. The market is only now understanding the gravity of the situation and that is now being reflected in share prices. But we’re just getting started.

Congrats, we’re now at Jan 2020 levels. December 2019 levels takes the NasCRACK down to 200, or 8% lower from here. That’s my short term target.

Today, trying to be clever, I made a variety of moves. Here are the results.

SOXS +2.6%
(SIG -4.6%)
(CCC -6%)
APT +48%
APT +28%
(TNA -5.5%)
(SPCE -6.2%)

The TNA and SPCE trades were poor attempts at me trying to catch a bounce. What I should’ve done is stand firm with my overnight SOXS position. Nevertheless, I did catch a day trade in APT for +28% and 48% from shares I bought a day or so ago. Who remembers these things anymore? The one constant in all of this is cash. I have lots of it — now about 40%.

In short, we dive into the close and dive again tomorrow, amidst the sorrow and the angst. The virus is coming and so are the margin clerks.