Tuesday, September 21, 2010

9/22/10 Brick

6am day after christmas
I throw some clothes on in the dark
The smell of cold
Car seat is freezing
The world is sleeping
I am numb

Up the stairs to her apartment
She is balled up on the couch
Her mom and dad went down to Charlotte
They're not home to find us out
And we drive
Now that I have found someone
I'm feeling more alone
Than I ever have before

She's a brick and I'm drowning slowly
Off the coast and I'm headed nowhere
She's a brick and I'm drowning slowly


That's what owning an asset feels like in the 21st century. One day you're excited to own shares in a company with promising future cash flows. The following week it becomes a brick.

+1.16% gain for the total portfolio since last Friday, and back in cash. I'm learning to be content with grinding out gains 1-2 yards at a time.

103 comments:

  1. I'm sure I'm wrong, but isn't the easy explanation for the ST reaction in T's based on the assumption the Fed. has no intention of letting up on buying them? I suppose the reaching in the financials is the opposite result. Borrowing at 0 and buying T's just got less profitable?

    ReplyDelete
  2. Re: Brick newSubmitted by 2nd_ave (4606 comments) on Tue, 09/21/2010 - 20:54 #69766 (in reply to #69764)
    Dave- Maybe we should turn our attention to gold. Now those are bricks we can believe in.

    ReplyDelete
  3. The troubling thought I have with the FED buying T's is in the short term it serves no other purpose than to keep government from feeling the pinch.

    It seems as long as WDC isn't forced to face the music we're continuing down the same path.

    Too bad they didn't concentrate on improving the economy from the beginning as opposed to simply rescuing financials.

    We desperately need change.

    ReplyDelete
  4. CP- I agree. That's why I said it was a ST reaction.

    2nd- Good job man. 1.6% in a few days for the total port is a real #.

    ReplyDelete
  5. Daily Post-Mortum:

    "Today the Fed confirmed that it is more likely the Second Coming of Christ will occur before interest rates are increased and added that the U.S. economy was indeed in the toilet but stands ready to help if the flush-handle is pushed. In response the markets rallied to fresh 4 month highs aided by news that home builders created more inventory for people to look at on the weekends. In a non-related note, General Mills reported that dog and cat food sales soared last month on reports 1 in 7 people in America are in poverty and 1 in 8 receive food stamps suggesting the alternative food products they offer may be filling an important nutritional need for American families at reasonable prices. These uplifting events are supported by the news that the Recession ended in June 2009 as Federal Express said they will fire 1,700 workers and close 75 shipping hubs around the world because the economy is picking-up. The backdrop of this positive news is based upon the jobless rate increased in 27 states last month, the Labor Department said Tuesday. It fell in 13 and was unchanged in 10 states and Washington, D.C. That's worse than the previous month, when the rate increased in only 14 states and fell in 18. It's also the most states to see an increase since February however it is expected that nobody with money really cares which is most likely why this news has disappeared from every major Internet Portal Site on the planet in order to report that the Fed has decided to leave interest rates unchanged and make home ownership more affordable, especially for those working in the federal government that coincidentally earn 3 times more salary that their counterparts in the private sector but pay 25% less in taxes than someone earning the same."

    ReplyDelete
  6. Oh, I forgot to mention the good news; unemployment within the US typically runs around 5% during stronger economic times.

    ReplyDelete
  7. I know this may sound reckless, but one of the reasons I got a little longer today is we haven't really had the "move" that roasts the bears.

    I really hate all of the lame stock market 'sayings', but a few I find do have some predictive value. One is, all gaps get filled. The other is, a bear market wipes out everyone. We're not there yet.

    ReplyDelete
  8. My subscriber black box spit out a Top Spotter today at the daily highs of SPX and Naz but not Dow. These spotters have often proven to be indicators of a counter trend move, down in this case.

    FWIW and I have been a subscriber for about a year.

    ReplyDelete
  9. illini- I've asked before...can you send a link to the service? I'd like to see the methodology behind it. Thanks!!

    ReplyDelete
  10. It is stopsandtargets.com. I do believe I posted it prior. There is not much deep info there but there is a video. I am in at the lowest level (3 major indices for $30 per month). It has kept me on the correct side of the major trends (LT and IT but ST is not it's forte). The seesaw, sideways market we have had is a challenge to their system but I think they have done fairly well for IT's and they did put up a top spotter at the last April high which has not been broken.

    ReplyDelete
  11. Mark - I agree with you. The only reason I'm not 100% long is because I wanted to just take a mental break. Otherwise I would be sitting all in. The more I read the more I hear people being skeptical of this "breakout"...think it's just a false one. Well, I highly doubt that.

    ReplyDelete
  12. Thanks illini, I'll take a look. GL!!!

    ReplyDelete
  13. TOF- You made the right move. I don't care what anyone says, when you have over sized gains in a short period of time it's far more stressful than building positions in a falling market you believe in.

    Same thing happened to me 3 times this year, to a much smaller degree than you. Those 3 trading periods account for all of my gains this year.

    ReplyDelete
  14. I smell a TT pool...How much longer for Timmy? Last man/women standing. Over/under has to be before the Nov. elections.

    ReplyDelete
  15. Geitner has to go too. Summers may be change but TG out the door would be real change. Maybe. I am for Elizabeth Warren to head Treasury.

    ReplyDelete
  16. The only long term stability I see is gold.

    Most of us were spoiled growing up in the 50's living in the house with the white picket fence.

    We got change for sure!

    ReplyDelete
  17. Most will be lucky to have change left in their pockets. I don't think Obama did this on purpose. I think at first they saw it as an opportunity to use a crisis to reward friends that got them elected, and as time went by, they realized that everyone else for the past 50 years has done that before them, and that they had wasted money that could never be replaced honestly, and that the nation was in a depression and bankrupted from all the previous attempts to avoid admitting it...

    We know now why Bush always had that scared look about him, even while trying to act defiant. I don't think he knew when he took office that the 90's bubble that had ended was the beginning of a generational depression, or he might have let Gore have the office so it would have been blamed on the Dems instead.

    ReplyDelete
  18. Well, I took the profit on UCO. It was $2300, so I figured I should take it while the big bid was there at $9.06.

    I can always reload or play something else...

    ReplyDelete
  19. After all, it IS football season!

    Note for everyone's desk.....

    You NEVER want to carry stock long into fed day, not ever. Even if long is the right direction, Fed days, in advance of the announcement are ALWAYS buying opptys. It is still to be determined if they are also selling opptys:)

    For those who like crappy little gold companies in the middle of frigging africa, ANO looks like a long. it's a buck now. This one went to 5.25 3 or so years ago when I told Kaimu to sell it after a gianormous move. He didn't until it collapsed.

    How's Bill anyway? Did he predict this move in gold guys, lemme know.

    ReplyDelete
  20. VB,

    I admit Jimmy Carter was a lousy excuse for a leader, but I blame most of this shit on Ronald Freaking Reagan.

    When he opened fire on Americans expressing their right to assemble and speak, that's when he should have been broken underneath the wheel:)

    I was a small boy in 1979, with no political awareness at all, but I knew in my heart that Reagan was a prick.

    See the thing is, all the various wingnuts have been trained by right wingers to believe that economics is a zero sum game...either the blacks win, or the whites win. Either the poor win, or the middle class win, when, at the end of the day, basically we all freaking lost. If not jobs, if not houses, then souls:)

    The politics of divide and conquer have succeeded wildly. Leaving nothing but the hollowed out empty shell of a nation.

    ReplyDelete
  21. a once-great nation, I might add...but we lost our voice, we lost our way, we lost our sense of purpose and the rats took over the ship. That would be Nixon, btw:)

    ReplyDelete
  22. African miners - Would that be South African by any chance? That is, the same South Africa where BEE and Apartheid are still gaining steam?

    http://www.southafrica.info/doing_business/trends/empowerment/bee.htm

    Just wondering...

    ReplyDelete
  23. CADC-

    8:59AM China Adv Construction Materials announced it has been awarded three high-speed rail contracts valued at a total of $10.7 million (CADC) 3.17 :

    ReplyDelete
  24. "China ACM Announces Three New HSR Contracts Valued At $10.7 M "

    ReplyDelete
  25. Random Thoughts:

    As usual, follow through will be key. Obviously, we didn't see any on Tuesday.

    One day at a time though.

    Again, if it comes right back in then all bets are off. See recent newsletters for more on the "fake out" scenario.

    The market remains overbought.

    Futures are soft pre-market.

    ReplyDelete
  26. This is one of those scary opens for me. Up 1.3% out of the gate on a soft market,

    ReplyDelete
  27. FINALLY got into eBay. Bought some at $23.6 on todays weakness. If I haven't expressed my love for this stock before, well, let me do it again. I love this stock.

    ReplyDelete
  28. I might take XCO off here. 10% return. I'ts just above the 50 and the 100 is a buck higher.

    ReplyDelete
  29. TOF- EBAY...I heard that someone is leaving.

    ReplyDelete
  30. Hi Shark,

    Yes, a during the nixon era the Bretton Woods system ended. That ended the gold standard

    Morning test:

    What was the reason behind ending the Bretton System (or not reinstating it)

    vb

    ReplyDelete
  31. yeah some dude(tte?) in their marketplace segment i think. who cares? it's all about paypal, which is becoming a huge force in e-commerce.

    ReplyDelete
  32. Sold my ODP this morning at $4.35. Also sold my REDF at $4.55.

    ReplyDelete
  33. Come on and ease on down, ease on down the road...

    ReplyDelete
  34. mark i still like ODP just like eBay more. keeping my risks low still until i'm sold on which direction the market is going. i still think its going up, but this crap can change on a dime.

    ReplyDelete
  35. TOF- Thanks. I really have no interest in it other than what you guys think.

    ReplyDelete
  36. Mark - I still have 200sh of ODP. Not sure. I'm not sure about anything in this environment. Watching the pullback. We could go either way from here...

    ReplyDelete
  37. X and AA running in different directions.....

    ReplyDelete
  38. TOF- Still thinking of RAS @ 1.40 if it get's there.

    ReplyDelete
  39. Mark - haven't had time to dig more into RAS...it's completely dependent upon the market picking up in my mind.

    Went long some October $23 calls on ebay at $1.09.

    ReplyDelete
  40. Reloaded UCO at 8.93, missed the bottom by a bit

    ReplyDelete
  41. team

    paypal is the only viable global payment processing system. No one can catch up at this point

    It isn't a bank - fee based - low overhead - growth india and china

    ReplyDelete
  42. out at 8.98, now at $2620 for the day

    ReplyDelete
  43. vb - totally agree. i use it for my furniture business and i have seen a clear trend toward more use of it every month.

    ReplyDelete
  44. out of UCO for 8.84, now at $2950 for the day

    ReplyDelete
  45. Did Bernanke happen to mention his long gold position y-day? Just wondering....

    ReplyDelete
  46. They decided to THROW the dollar under the BUS, justifying the debasement in order to improve unemployment numbers.

    But, WILL it improve unemployment numbers?

    HOW MUCH debasement will be needed before we can put America back to work balancing the trade deficit?

    ReplyDelete
  47. took a loss on a UCO trade, now at $2730 for the day

    ReplyDelete
  48. the way financials are breaking down, the bears might just be on to something with this false breakout they're calling for. if they continue to go down then qe2 is definitely in play.

    ReplyDelete
  49. "HOW MUCH debasement will be needed before we can put America back to work balancing the trade deficit? "

    Funny how the U$D is so high when you consider the trade deficit that's been carried for decades, and the growth that's beginning to accelerate in emerging nations.

    Why would anyone want to hold the currency of an economy that's dead in the water?

    Go figure...

    ReplyDelete
  50. CADC - Relative volume is 4.6x today. Is it HFT fakery, distribution, or some kind of accumulation?

    I have no idea...

    ReplyDelete
  51. I woke up, saw that copper, aluminum, FCX, AA are in a rally mode, and figured that the current market weakness could only be temporary, and so I should take this opportunity to close my SKF while I still have a decent profit in it. So I just sold at $19.72 the 300 shares I purchased a couple of days ago at $18.91, for a profit of $230.

    ReplyDelete
  52. Just covered at $84.72 my 200 short shares of FCX for a loss of $520. Not good. But then, copper broke out about $3.50, and if I wouldn't enter FCX short at this point, then holding it doesn't make sense as well. I'll re-enter this short when copper breaks down below $3.50 or when FCX loses momentum at higher prices.

    ReplyDelete
  53. long UCO again at 8.77 this time. I feel like turning off the screen for a week and not looking...

    ReplyDelete
  54. For now, I placed a sell short stop order for 200 shares of FCX at $84, just below the range where it oscillated today, so as to catch it on the way down.

    ReplyDelete
  55. i tell you what...if the market stays above 1,130 for a week or so then it will have essentially traded sideways while working off its current overbought state. I think it will do this but I’m watching for the sidelines for a little while longer so as to not let all of my gains slip away.

    ReplyDelete
  56. doubled at 8.70, unloaded at 8.77, now back to $2930 profit for the day.

    That's enough for me! I'm gonna take it and keep it, and THEY ARE NOT GETTING IT BACK!

    ReplyDelete
  57. Well, they keep banging 1130 aren't they. I'm probably biased as my port is green for the day, but I say this holds and is just a shakeout.

    Good job Bob!!!

    ReplyDelete
  58. OK, here's the parameters for the Timmy Pool. Date of announcement and replacement.

    Winner to receive 2 tickets to one of Kendra's soccer games, a juice box, and granola bar.

    Here's mine:

    Nov.15th/Jamie Diamond

    ReplyDelete
  59. Even though I am leaning short in my thinking, and in fact I am SURE that the market will be MUCH lower at some point in the next 2 years when the next recession hits, in the meantime I am ready to give benefit of the doubt to the speculative fervor that can arise based on Bernanke's promise of doing QE2 as soon as the economy starts weakening noticeably. I don't have any short/ultrashort positions now (only puts to protect my downside), so I am a disbelieving bull...

    ReplyDelete
  60. CP- CADC action not good at all. Looks to me like someone was waiting for some volume to get out.

    ReplyDelete
  61. One could say that we are in the last stage of the bull market when gold is rallying, but then I see copper and aluminum rallying strongly today is well, so I would say that we still have some ways to go before we finally put a top and start sliding into the next recession.

    ReplyDelete
  62. Frigging AA is still cooking. Any ideas here guys?

    ReplyDelete
  63. Re: ADBE newSubmitted by 2nd_ave (4609 comments) on Wed, 09/22/2010 - 13:55 #69842 (in reply to #69810)
    Closing @ 26.64. (Also closing ADBE Nov 25 calls, opened at 2.23, closing @ 2.40.)

    ReplyDelete
  64. Let's see how the pit closes crude.

    ReplyDelete
  65. some more indicators
    Submitted by DavidV (16 comments) on Wed, 09/22/2010 - 14:24 #69847

    The market will start pricing in the next recession when the high-yield bond spreads start shooting up. They shot up before the equities started heading down in late 2007. They shot up in May 2010 but are now back to the lowest levels since mid-May (according to the CDX.NA.HY series on markit.com). At the same time, EUR in JPY terms is back to its highest levels since mid-May.

    So the market is definitely not heading toward greater and greater risk aversion, and so the current temporary rally can keep going higher for a while before it finally reverses and S&P drops below 1000. In fact, Jeremy Grantham thinks there is 0.45 probability of S&P rising to 1300 or above by the end of 2011 based on speculation arising from 0 Fed funds rate and QE2 promises. When this equity bubble finally bursts, the whole world will be in tears because the Fed funds rate will still be at 0 and the only thing the Fed will be able to do is to print $USD outright. THAT'S when gold will *really* start zooming.

    ReplyDelete
  66. My FCX short was triggered at $84.05, but I covered right away at $84.07, since as I wrote before, the macro picture is still bullish.

    ReplyDelete
  67. boy it sure looks like eBay is going higher. Buying the dip today has been a great play. I think this stock is heading much higher.

    ReplyDelete
  68. re: UCO - I should have known they always fuck me...

    ReplyDelete
  69. I've been consistently losing money while shorting FCX, and I am wondering whether I should be buying it instead. So I just bought 200 shares at $84.11. Looks like the indexes have put in a higher low on the intraday chart, so FCX should move up as well.

    ReplyDelete
  70. Placing a sell stop at $83.95, just below the level where it had stalled recently...

    ReplyDelete
  71. Moving my stop on FCX to $84.30 so as to definitely make some money on this intraday trade.

    ReplyDelete
  72. I had a brief thought of placing my stop at $84.50, just below the recent congestion area, but I guess they sensed my thoughts and immediately spiked down FCX briefly below $84.50 so as to run my *imaginary* stop! These black box trading algorithms are getting to be very good! :))

    ReplyDelete
  73. ok it's official. i'm sitting on my hands for another few days outside of the tiny trades i'm making.

    that Sensex index (india index) sure looks like a parabolic move up and those usually end really badly on the either side of things. Maybe REDF has run up only because people have been scrambling to buy anything India related? If that’s the case and REDF doesn’t clear $5 I wouldn’t be surprised to see it go back down. and i wouldn't be surprised to see a lot of things down in general because a piece of this recent run up was based on speculation overseas.

    ReplyDelete
  74. i'm just gonna sit and watch the action, particularly UUP, FCX, AA, JPM, Copper Charts, Sovereign Spreads, and the Sensex.

    By the way, STT fell back below the $37.9 support level.

    ReplyDelete
  75. CADC - Earnings report this month (90 days following EOY: June 30th).

    This company is well positioned, this must be a shakeout attempt.

    Shoulda waited for RSI(2)< 2 before adding so I'm gonna just hang in there.

    Kinda like water skiing.

    ReplyDelete
  76. TOF- Yep, JPM...I watch it all day. The way I look at things it needs to hold right around here or we might be in trouble.

    ReplyDelete
  77. SPX 1136 - Hmm, I'm surprised, expected closer to 1130... 1131 was low, better than expected.

    When does Moral Hazard start kicking in?

    ReplyDelete
  78. Man, those black box algorithms are tough to compete against. They did stop me out of FCX at $84.30 (for a $40 profit) and then ran it back up. Well, a $40 profit is better than a $400 loss. :))

    ReplyDelete
  79. Water skiing hun? OK, but can you speed the boat up a little. I'm slowly sinking :)

    ReplyDelete
  80. Remember a couple day ago when S&P just sliced right through 1130? Didn't you ask yourself "WTF?" at the time? I did, there was no contest whatsoever...

    ReplyDelete
  81. If I were the pilot, you'd have a hard time hanging onto your Cypress Garden Specials...

    ReplyDelete
  82. Man....Thank God my 3 biggest positions were in the green today (SWN/PXP/XCO). Flat on the day. OK, down -.02%

    ReplyDelete
  83. I know SNDK has a bearish flag or whatever those bullshit artists...err technical analysts say, but I didn't realize that the company has $5.2 Billion in cash ($4.3 Billion net after backing out debt). The market cap is only double that. Aren't they in the iPad and potentially other tablet devices? They have been generated about $350 Million in free cash flow each of the past several quarters...

    ReplyDelete
  84. "The first water ski show at Cypress Gardens was performed in 1941 and was a bit of an accident. Julie Pope, the park founders wife, had sent a photo to the Orlando Sentinel, which they ran, and featured beautiful flowers and skiers in the background. The next day three servicemen showed up and asked what time the water ski show was. Mrs. Pope stated that the ski show was at 3:30 p.m. and asked the gentlemen to enjoy the gardens until that time. Ironically, though, there was no ski show so Mrs. Pope quickly telephoned the local school to have her son, Dick Pope, Jr., round up some friends to perform for the soldiers. She picked the children up promptly at 3 p.m. and the show began exactly on time!"

    ReplyDelete
  85. cb...bob..........David said...
    I had a brief thought of placing my stop at $84.50, just below the recent congestion area, but I guess they sensed my thoughts and immediately spiked down FCX briefly below $84.50 so as to run my *imaginary* stop! These black box trading algorithms are getting to be very good! :)),,,,,
    Man, those black box algorithms are tough to compete against. They did stop me out of FCX at $84.30 (for a $40 profit) and then ran it back up. Well, a $40 profit is better than a $400,,,,,,

    somehow your trading patterns are not subject to being easily picked off.

    you might back check trades,for volume, length of time span,slope angle as win/lose trade factors. same goes for david's fcx log. the algo is also subject to gigo, really just kids trying to out guess you!
    you know better than any one else how to find logical terms to deconstruct why & when you change each directional choice.

    e5

    ReplyDelete
  86. CADC - Okay, this may have something to do with the recent action, looks like there's some kind of expiration associated with warrants?

    http://finance.yahoo.com/news/China-ACM-Series-A-Preferred-iw-1123658655.html?x=0&.v=1

    ReplyDelete
  87. I figured that instead of trying to short FCX in the environment where copper broke out above the $3.50 resistance level and gold is obviously heading higher, I will try shorting IWM, which is also very extended now on a 6-month chart. I have just placed a sell short stop limit order for 300 shares at $65/$64.90. I want to protect my currently net long portfolio if the market starts sliding tomorrow.

    ReplyDelete
  88. e5,

    Its either "just me" letting fear take over and being "relieved" to get rid of whatever for any profit, or something to that effect, because they do it to me on just about EVERY issue I bottom fish.

    I think the root cause is that I never really did figure out a GOOD way to decide when/how to sell when in profitable territory. The way I'm doing it saves my butt, making me a profit in a waterfall collapse, but gets me out too early when I REALLY DID (surprise!) pick *THE* bottom, I think.

    As for the mm's catching on to me, I usually only trade any one thing for a day or two, and then choose another issue, so I don't think its that they see my trading pattern.

    ReplyDelete
  89. And thanks for getting me to think about that. I did experiment before with other exit strategies, but never did get something that worked better down pat.

    ReplyDelete
  90. Analyst65 just made an interesting post on CC, at 18:11.

    There is some truth to it -- I remember that when the yield curve became inverted in 2007, the equities kept moving higher for a few more months and the inverted yield curve was dismissed because "this time was different." Well, it wasn't. If the short-term rate were not pegged at 0, then the recent collapse of the long-term rates would have led to an inverted yield curve. The stock rally between March 2009 and April 2010 has also coincided with a rally in bond yields, so THAT'S what we could say is a NORMAL reaction to fiscal and monetary stimulus. In that light, the recent collapse of bond yields signals that we are not in the same NORMAL environment now. As such, right now is probably not a good time to do buy-and-hold, and instead the recent market rebound might be a great opportunity to go SHORT. That's why I put the sell short stop order under IWM for tomorrow and I am ready to jump in on the short side at the first sign of market reversal.

    ReplyDelete
  91. David...just my take on this guy.

    Re: The Folly Of Investing Today, (Interesting READ).
    Submitted by teamonfuego (2177 comments) on Wed, 09/22/2010 - 19:33 #69867 (in reply to #69863)
    Anyone that has listened to this Denninger guy has lost a lot of money over the past 2 years. The problem is he can't segregate the economy with the markets, much like any permabear can't. His claim that the 10 year Treasurys has always lead the S&P 500 is dead wrong.

    http://finance.yahoo.com/echarts?s=%5ETNX+Interactive#chart6:symbol=^tnx;range=my;indicator=sma(50,200)+dividend+volume+rsi(7);charttype=candlestick;crosshair=on;ohlcvalues=0;logscale=on;source=undefined

    The above chart shows the long term 10 year chart. As you can see there were plenty of times when the 10 year tumbled significantly yet it didn't result in any decline in the S&P 500. I understand he is only looking at the past 10 years but why do that? Why not look at more data points?

    This Denninger guy is still calling for a S&P 500 of 200 and change. Puhhhlease. If half of the companies in the S&P 500 went bankrupt and you applied a 5 multiple on earnings of the remaining 250, you would get to about S&P 500 at 200. That's how absurd this call is.

    I urge the permabears on this board to consider other opinions than this guy. He may have a good take on the shenanigans going on in the mortgage industry and on economic reports but he has had a horrible take on the markets for a while now.

    ReplyDelete