Sunday, September 11, 2011
09/11/11 Easier than anything I'll ever do again
Waking in the morning to the feeling of her fingers on my skin
Wiping out the traces of the people and the places that I've been
Non-stop weekend. We lost 6-1, but the little guy dominated play/scored the only goal for his team.
I see negativity continues to reverberate through the global markets tonight. Don't let it bring you down. It's a natural cycle, as timeless as dusk/dawn and the tides. One morning you'll wake to the realization that you've hit what Brinker refers to as 'critical mass,' and the myriad sell-offs along the way fall into place as natural counterpoints along the way.
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Watching the news and one of the 'economic experts' was referring to O's speech and said he liked everything until the '..and you guys figure out how to pay for it part'...Like was posted at DT instantly once said by a very astute DT commenter.
ReplyDelete2nd- Time for the little guy to move up to the insanity of Div. I soccer. It will scare him for life ;)
ReplyDeleteI've fully participated in the study of alcohol and it's effects on health this weekend. Had 2 tall bud lights at the Angels game on Saturday and had a couple great local beers at the bar my buddies and I go to to watch the football games.
ReplyDeleteThe Angels game on Saturday was my first time to Anaheim and we got to see an excellent matchup: CC vs Haren. We lucked out on our seats: bottom of the upper deck, just left of the foul pole, gives you a direct shot of the bull pen and we were able to watch CC and Haren side by side throwing warmup for about 15 minutes.
Anyway, my takeaway is that the field is decent, nothing great and definitely not as nice as Petco. But the fan base in San Diego pales in comparison to the fan base in Anaheim. I miss living on the east coast and going to Red Sox games and Mets games (I'm a Mets fan). There's nothing like baseball on the east coast (sorry you SF guys, but it's true).
i doubt if the recent lows hold...just about every other market is at YTD lows...
ReplyDeleteWell, it looks like it's happened...people are selling everything now overnight, including gold, as i was saying would be the sign of a true bear market. If gold falls with equities then we're probably in a liquidation phase of the markets...
ReplyDeletenot a pretty picture, watching the round number of course, 1.360, that said at least the 9'ers won!!!
ReplyDeleteBeauty is in the eye of the beholder, and that certainly applies to this morning's futures. I like 'em.
ReplyDeleteSold my BGZ at not the greatest price: $45.25. Oh well. Overnight it was looking nice They love squeezing the shorts in these downturns.
ReplyDeleteClosed my SPY puts out as well. Made about 2% total on port on both...I really need to start trading futures because it's so much easier to get out at reasonable levels overnight. They just jack up the futures before the open so many times on a gap down that it's impossible to get the best price during market hours.
ReplyDeleteGLD is down short term, it was in a technical down pattern on Friday as I pointed out. It bounced of resistance.
ReplyDeleteI am seeing nice equity buying here, there seems to be support for equities as far as I can tell. I like this market action since the new is horrible.
For those traders who sold at the pre-market lows- congratulations.
ReplyDeleteSome M&A activity is helping as well ( BRCM bought Netlogic). Let us face it Greece is small and at the end of the day is a European issue.
ReplyDeleteTo your counterparts.
ReplyDeleteCall me crazy, but I just bought calls on EWG...I bought 23 x October $16 Calls at $2.4
ReplyDeleteTrading requires the ability to skate on thin ice. So we already know you're crazy.
ReplyDeleteThanks 2nd!
ReplyDeleteI figure Germany is due for a bounce here soon. Down 1/3 of it's total market value in a very short amount of time is pricing in quite a bit. I read that the German market is trading at 7 times future earnings versus a historical average of 15 times. I know future earnings have to come down for sure, but I'm thinking there is a bounce coming here.
I just checked SOKF, which was one of the china small caps that I was following. I didn't realize they went private. I was reading through the news releases and it was the fastest takeover I've ever seen. In a matter of 3 days the deal was announced, the shareholders voted in favor, and the stock was delisted.
ReplyDeleteLose 1140 and 1130 is next.
ReplyDeleteGood luck guys. Might take a position at the close.
I would need to see at least 10,500 on the dow, the 38.2 retrace.
ReplyDeleteFSG - One for the ballsy traders...
ReplyDeleteTOF - TXN went up on Friday on the news on their "earnings miss" on a day the market was down 2.5%.
ReplyDeleteThat tells me expectations are very low and can easily be exceeded. It's not the news that matters , its the reaction to the news.
Also, talking to a friend of mine over the weekend who I consider to probably the best value investor I know. He's a buy and hold guy with average holding time of about 3 or 4 years. He was taking profits in a few of his stocks earlier this year, but said he is buying now. Not too quickly and feels he may be early, but is very confident that buys made at current levels will work out great in his 3 or 4 year holding timeframe.
Man it's crazy how many overseas markets and financials are heading toward their 2009 lows. That makes me wonder if the S&P will ultimately be following their lead.
ReplyDeleteTXN reversing gains from Friday...trend is still lower. IYT, Copper, CAT, XLI, XLE all looking like they're setting up for lower prices. I wonder if those permabears are gonna be right, but broke after trying to short for the past 2 years...
BB - I think we need to be open to the possibility that we could very well be entering a very long down period...I'm not saying it's gonna happen, but if the bond markets force Greece, Italy, Spain, France, Portugal, and even the US to deleverage, then the benefits of government spending won't be showing up in corporate earnings any time soon. If earnings come in around $75 a share and people are only willing to pay 9 times those earnings, then we could have substantially lower equity prices.
ReplyDeleteAgain, not saying it will happen, but when the momentum ball gets rolling it's best to wait for confirmation of a bottom in my opinion. Trades are one thing but I'm not ready to be long term bullish yet.
Look at the CDS Spreads:
http://www.cnbc.com/id/38451750
Italy has doubled since I started watching it 7 weeks ago. Spain is up over 50%. France is approaching what Italy was 7 weeks ago. Both Italy and Spain are higher than Greece was last April before the shit hit the fan.
If we have issues in Italy and Spain like we have in Greece then we will go much much lower.
Good call on shorting gold, Igor! Did you act on your intuition on Friday, even if with a small position?
ReplyDeleteIt's interesting that TLT is basically flat today, so not everyone is panicking yet...
ReplyDeleteDavid - Note that TLT actually "panicked" higher in fall 2008, then fell quite a bit despite the equity markets going lower afterward. It's not always a perfect correlation.
ReplyDeleteDB - I suppose whichever banks are exposed to Greek debt are still liquidating their market gains in order to cover their Greek debt losses and prepare for the potential further loss on remaining BRIC's....
ReplyDeleteOf course I'm just a mushroom in the dark, as always.
The only reason I'm long EWG calls is because I think if there is any resolution to the Greece debacle, Germany will skyrocket higher very quickly...possibly as high as 20% higher and I will be able to close out my calls at substantial percentage gains.
ReplyDeleteOtherwise, I'm just kind of watching how the market trades, waiting to see if Jeff Saut is right about the market making a bottom:
http://www.minyanville.com/businessmarkets/articles/jeff-saut-obama-jobs-speech-equity/9/12/2011/id/36830?page=2
Or if Mary Bartels is right:
http://www.bloomberg.com/news/2011-09-12/s-p-500-may-plunge-21-bank-of-america-says-technical-analysis.html
The good news is that WATG started trading again as a pink sheet stock (WATG.PK)! The bad news is that it is down 80% from where it halted its trading on NASDAQ. So much for the $30K I had in it at $5.42...
ReplyDeleteWhippy out there.
ReplyDeleteNo shit. WTF is UP with WATG?
ReplyDeleteWATG acquired another company in 2010 and they were accused of paying too much for it because some WATG officers were also officers of that company. As a result, an investigation was launched and WATG did not complete any earnings reports since that time.
ReplyDeleteTOF, you are right that we could see a pullback in business and subsequently the market, but I still don't think it happens and it is hard to protect against that (Puts are very expensive) if you believe the market will go higher.
ReplyDeleteBig end of day bounce here - probably just short covering on the news China may buy some Italian bonds, but every rally starts with short covering, so not a bad thing.
Wow, what an interesting trading day today! Despite all the bad news mounting up, the US indices are not going down!
ReplyDeleteThe other person who may be right about the market is Laszlo Birinyi who thinks we are just in the middle of a multi-year bull market which started in 2009:
ReplyDeletehttp://www.bloomberg.com/news/2011-09-12/birinyi-sees-stock-bull-run-intact-as-apple-joins-google-to-offset-greece.html
When I woke up this morning, DJIA futes were in the -200 range premarket.
ReplyDeleteDon't let the noise ---- with you.
I believe the pop is due to a rumor that china is going to buy a huge sum of italian debt. Got to look at it as a 200 pt up day.
ReplyDeleteBB - I like Laz...I think after the market began falling hard he started changing his comments a little and stressed that he's more focused on buying individual stocks than the market itself...he was probably just second guessing his 2,100 call on the S&P 500 by 2013:
ReplyDeletehttp://finance.yahoo.com/blogs/breakout/p-500-going-2-000-laszlo-birinyi-120034902.html
I'd probably put him more in the perma bull category than anything else...but his contrarian view point is good to hear when you're long and things are rough. I agree that there are plenty of companies that will do well in a bad market and if the market is good then they will do really well. I personally think it's smartest to just wait until you have some sort of confirmation that the bull market is intact. For me that's when the market is above an uptrending 200 DMA or when the market has sold off extremely hard and the RSI is very low...
Today's action is EXACTLY why it pays to be in cash if you're nervous about the market, rather than trying to short rallies. We just ripped 2% higher in about 40 minutes.
Rumor: http://markets.financialcontent.com/stocks/news/read/19442672/FT.com_Reports_Rumor_of_Chinese_Negotiation_to_Buy_Italian_Debt_
ReplyDeleteUnfortunately, this rumor did not cause TLT to go negative, despite a positive day for S&P. Maybe bond traders are figuring that China might increase its buying of US debt next?
ReplyDeleteBB - Take a look at the Germany market overall...In my mind an argument can be made for it being VERY cheap:
ReplyDeletehttp://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2011/09/12/bloomberg1376-LR9MAC0YHQ0X01-0755GDR12009MSF04VCUCRNLEK.DTL
EWG is a good way to take advantage of the very hard fall in the index that Germany has had. Or you can buy DB, which is only about 40% above it's 2009 lows and has a 2.5% dividend and trades at about 4.5 times earnings.
There is a difference, however -- US Treasuries are yielding next to nothing, while the Italian bonds are yielding MUCH more. As I understand, the chance of Italy defaulting on their debt is very slim, and so China is doing a very sensible thing buying their bonds. With their long-term planning, we can always count on China to step in when others are panicking over good assets.
ReplyDeleteThat's why gold won't stay down for a long time -- a few years ago China announced their plans to boost their gold holdings over the next 20 years, and so every dip in gold over the next 20 years will be bought.
ReplyDeleteAnother stock that has gotten hit hard because of it's ties to Germany is ARGN, which is a small cap growth company that makes the temperature control seats that you get in mid to high end cars. They have a division that developed a system that allows cars to capture the heat from their exhaust and recycle it back into the power of the car, which saves on fuel consumption by like 20% I think. The government just awarded them and Ford a grant to further develop their technology. One of my clients owns a lot of their stock in their hedge fund and have held it for years.
ReplyDeleteYeah, Germany looks cheap, their employment situation is great (just hit a 20-year low), and they've got a lot of good companies.
ReplyDeleteAssuming things work out (which I am), their stocks should do well. Always nice to buy stocks at all time low valuations (the article says).
The other easy way to play it is Germany Funds closed end fund (GF). Less financials and at a 9% discount, although this may be off a bit due to the fast moving markets. No options though.
I think EWG has upside to $21 in the short term. As such, I have put a sell order in for my EWG October $16 Calls I bought today at $5. I'm gonna try to pull my best David and let that sell limit order ride. I think the DAX has a very powerful up move coming.
ReplyDeleteBKJ is another regional bank that I like...history of steady revenue and earnings growth over the past 5 years:
ReplyDeletehttp://financials.morningstar.com/income-statement/is.html?t=BKJ
insiders have been buying the stock for a while now...look at that EPS growth:
2006: $(0.12)
2007: $0.17
2008: $0.10
2009: $0.25
2010: $0.41
TTM: $0.49
That's an expensive call for 6 weeks. You need a big fast move!
ReplyDeleteI've got SNBC (the Wilbur Ross Bank) in New Jersey. He's gotten in there and made the hard decisions that needed to be made to put the garbage behind them so they can get back to growing the business. I'm looking for a triple out of it.
Your WNC is around $5 now and should also do well if the market recovers.
Love the PVR for watching the US Open Tennis finals. If I skip forward 30 seconds, I can pretty much perfectly avoid the whole period from when 1 point finishes until the next 1 is served up.
ReplyDeletenew post
ReplyDeleteWow, looks like China came to the rescue, huh? I read about it here, first! Good work, guys!
ReplyDeleteARGN - Sounds interesting TOF, recycling heat from an internal combustion engine is exactly how efficiency is going to be increased.