Wednesday, December 23, 2009

A gapping we will go

up again - almost seems too easy for this market to go up... but, hey, I guess everything is fine again and we are in a new multi-year bull market. get long so they say on CNBC...

Tuesday, December 22, 2009

Bailout BS

http://finance.yahoo.com/banking-budgeting/article/108455/wall-street-alchemy-turns-bailout-into-gold

unreal, but the truth - i do think the big banks actually run the world


Monday, December 21, 2009

Higher we go...

feels like the bulls are about rip us higher. I actually think they can. Not much else to do except buy dips and not get short I guess.

Friday, December 18, 2009

More of the same BS

market seems off hard yesterday on big volume. Next day - bulls rip us right back up.

Can't fight this market. It is a long only, buy every f-ing dip blindly type market. yesterday, banks look ready to tank - today someone had to own these banks and they rallied. same pattern again and again - just when it looks like any sector / index will break - someone saves the day...

As I have said it will end badly but right now all systems go as the beat goes on and longs can't lose and have no reason to be nervous...

Monday, December 14, 2009

All the big banks getting rid of TARP before year end - WHY?

ummm... think about it. TARP has bonus restrictions mandated... with TARP paid back the banks can pay huge bonuses with all the free money they got! notice most of these big banks have huge capital markets/trading operations versus just retail banking...

nice trade big banks!

We have a long-only market

I know I have not posted much lately but not a lot to say into year end. We have a market where you can only be long because the momentum / action all favors buying dips at all times. In fact, for the most part stock picking hasn't even mattered as long as you were LONG you made money. The CNBC spinners are working full time to support the bullish mindset and bad news is shrugged off or somehow looked at as catalysts...

This market defies my underlying fundamental thesis so I have abstained from being long and have gotten chewed up a couple times shorting, but I stand where I am - looking to short but unable to pull the trigger because new 2009 highs seem to be destined to occur and this week would likely be a week (with the fed meeting, options expiration) that the big money will rip us higher.

Congrats to those longs who stuck it out through this whole rally. I certainly missed most of the move as I had no idea the power of a government and federal reserve that has no end to supplying money and any other stimulus the wall street moguls wanted and were surely positioned for.

It's about rally time for the markets again as the last hour or so thru the last 6-8 months have been full of day end rips where "someone" comes in and drills the buy button... only a few institutions with enough powder to cause these movements...

Can you say new highs this week? I would bet on it - even though I don't have my money behind that bet.


Tuesday, December 8, 2009

I am back again

after google took the blog off for a few days for some reason?

Monday, November 30, 2009

Everything back to normal

Market rallies in the last hour per usual. Surprisingly, banks and reits rocket back higher than they were before Dubai even happened. This was shocking to me...

Tough market to play unless you buy, buy, buy. I have a feeling this will end very badly for longs but when is the question. As of right now, I see no fear in the longs and the buy the dip has worked so easily it's hard to stop doing it I guess for longs despite economic / geopolitical issues. Not a lot to report these days as eco data or news really isn't that important. This is a market driven by momentum and fear to sell/short...


Thursday, November 26, 2009

Looks like it will be a "black" Friday for the US Markets

Futures down big on this Dubai news and a worldwide selloff...



Dubai Debt Problems Could Rattle Market Friday

Look for the banks to get ripped...

Dubai said on Wednesday that the delayed repayment of debt was a first step toward restructuring Dubai World, the conglomerate that spearheaded the emirate's breakneck growth.

The news has sent the cost of insuring Dubai's debt against default soaring and bond prices tumbling.

State-run Dubai World has $59 billion of liabilities, its subsidiary Nakheel said in August, a large proportion of Dubai's total debt of $80 billion.



Wednesday, November 25, 2009

Is chasing performance a viable investment strategy?

I hear about how the market is going to go up because people are chasing performance.

I ask you is that a viable investment strategy or reason to be long?


Prechter makes a 200% short call (all-in short call)

check the article

http://www.marketwatch.com/story/elliott-wave-adviser-now-aggressively-bearish-2009-11-25



Gap and Crap?

Market gapping up, but is this a set up fro a "gap and crap" or do we just rocket thru highs the day before Thanksgiving?

Oh, and dollar down and market/gold up again... what else is new?



Tuesday, November 24, 2009

Interesting how major economic data is consistently revised lower

weeks after it made its impact on the market.

today, 3rd quarter GDP was revised from 3.5% to 2.8%. If you remember a few weeks ago the market went ballistic when we had the 3.5% which was above the 3% forecast. But, since it is weeks later it doesn't matter. Ever since March this revised lower after the fact has been going on.

strange, huh?



Monday, November 23, 2009

Same report as usual

dollar down, market up, gold up

nothing really else to report



Monday, November 16, 2009

Back from a little break

market still in full go-go mode I see... supported by the dollar continuing it's dump - down another 0.5% this morning... who knew it was this easy to work the stock market up and help the wealthiest people by hurting the poorest...


Friday, November 6, 2009

Perfect 10 - 10.2 to be exact

Serious "realistic" damage done today to the bull case as unemployment soars to a reported 10.2% well above the analysts 9.9% estimate. Remember, the market is up over 3% this week in anticipation of this report.

This is highest since 1983, but who knows the bulls will find some silver lining to bid up stocks right?

Oh - and for those playing along at home the "Adverse Case" unemployment for 2009 used in the Bank Stress Tests was 8.9%. Ooops...

Anyway, let's go buy some stocks because we must have finally reached a bottom and economic data only matters when it is bullish, right! That's the way the bulls have played it and they have played it well as shorts get chewed up again and again... when is the longs "day of reckoning" - i would say we are not too far away.

oh and by the way the U6 or full unemployment rate is at 17.5% - giddyup!



Thursday, November 5, 2009

Bob Prechter - Rally Ova!




I am shocked by the strength in the market today

nothing else I can say except wow or WTF?

But taking daytrading short right here at S&P 1063 and Naz 2102


Friday, October 30, 2009

Trick or Treat - Longs Get Tricked, Shorts Get Treats!

BOOYAH - Shorts get paid Part 2!

Shorts got paid as hell today (myself included). Looks like my thoughts about yesterday's move being ridiculous was actually right.

Now next week the longs could really be on the run. This is a true character change in the market.

Be back later but out for now as I had a big day after a lousy day yesterday. Good week overall for yours truly although it did not come with out the drama.

Thursday, October 29, 2009

Booyah - Longs Get Paid

That sucked for shorts...

somehow everytime the market looks like it is going to really correct (closed below the 50 DMA yesterday) buying comes in - I mean everytime since March... i might even start thinking some of the conspiracy theorists are right!

once again after getting f'ing rocked on huge volume yesterday the buyers step in on minimal volume and shoot us back thru yesterday's starting prices.

i don't get the magnitude of this move. i thought we had a chance of bouncing up off of the GDP numbers today but 2% - are you kidding?

anyway, i would like to think getting short here or tomorrow at month end would be the thing to do if you are not short. that said, it may be better to just sit in cash if you don't like the volatility as shorts have been fighting an uphill battle and seem to still be.

the magnitude of this move is really what surprises me... even a 1% bounce I could see but this move has me a little confused.

still short, but confused. that's just the honest truth

If you want to truly understand the GDP report and not just the talking head perma-bull version click this link http://globaleconomicanalysis.blogspot.com/2009/10/market-cheers-over-ugly-gdp-report.html

Wednesday, October 28, 2009

Booyah - Shorts Get Paid

What do you know? The dip buyers became ripped buyers today. As discussed here I shorted with size at the S&P 1090ish level. I also mentioned shorting China yesterday which came off big today. These shorts have paid handsomely. The fantasy recovery may very well be unraveling now as irrational exuberance subsides. Tomorrow GDP which may print OK for the bulls to try to buy us up into month end (although I see possibility of disappointment in the GDP consensus at 3.2% and I think it may be closer to 2.5%). Still it will show growth and bulls may try to push us up on that fact alone despite that it is built on stimulus money. That said, if the market bumps up, I would short the move.

I think this is the beginning of a deeper correction that CNBC will be promoting.

COMMENTS FOR OCT 29/30th (TODAY) POSTED BELOW
!

Tuesday, October 27, 2009

Will we see continued weakness?

market about even this morning...


Monday, October 26, 2009

The seesaw continues

markets jumping early today for no reason


Friday, October 23, 2009

It's a "bull" market

MSFT beats big as expected


Thursday, October 22, 2009

Do we get confirmation of a move lower today?

Initials claims higher than expected... that will hurt the bull bounce case today


Wednesday, October 21, 2009

Dollar getting beat up again

This is scaring me. At some point the general stock market may get concerned about a currency crisis. But until then dollar down stocks up!



Tuesday, October 20, 2009

Today's market thoughts string - read the comments

I post my thoughts in the comments section


Monday, October 19, 2009

Market thoughts string

See comments as this post is just to open my market comments in real-time.


Tuesday, October 13, 2009

We have an "It's all good!" stock market

Whatever happens - "It's all good!"

Unemployment at 10% and getting worse - It's all good!

Market up 60% in a few months - It's all good!

Dollar going to shit - It's all good!

Gold through the roof - It's all good!

Foreclosures at all-time highs - It's all good!

Banks failing left and right - It's all good!

FDIC is broke - It's all good!

Government spending out of control - It's all good!

Low analyst estimates and company's beating - It's all good!

Valuations well above normal depending on any metric you look at - It's all good!

Consumers have no money and can't borrow - It's all good!

Feel free to add your "It's all good!" comments in the comments.

But first go buy some stock... and enjoy some MC HAMMER with the message of the day "It's all good" and I think the bulls are doing this dance lately as well!



Feels like there are real sellers out there today

Volume up

GS downgraded by Whitney - What Government Sachs downgraded? That's legal?

JNJ beat on lower sales and tax rate

CSCO announces dilutive acquisition

Let's see how they close this market ahead of earnings that will need to be great to keep this momo flowing... Banks weak early, Naz stronger early...

Will this be the the day buying the dip gets you burnt? Probably not as buyers will surely come in and squeeze us green, right?

Monday, October 12, 2009

Rallying S&P 500 Never Cheaper in Europe on Dollar-- Bloomberg.com

I am still not a buyer here but...

Bloomberg.com ran a story this morning with an interesting take on the valuation of the stock market. Excerpts from the story: Investors outside the U.S. are purchasing companies in the Standard & Poor's 500 Index at the cheapest valuations on record, their buying power boosted by a seven-month decline in the dollar... The S&P 500 is priced at 19.9 times earnings, the biggest discount to the MSCI World Index of 23 developed countries since May 2003, according to monthly data compiled by Bloomberg. For Europe-based money managers, currency translations push the average cost for a dollar of U.S. profits down to 13.6 euros, the lowest level ever relative to global equities... For overseas investors buying stock with currencies that appreciated versus the dollar, shares of S&P 500 companies may be an even bigger bargain relative to global equities. Adjusted for euros, earnings for S&P 500 companies are about 50 percent cheaper than those in the MSCI World, data compiled by Bloomberg show. That makes U.S. stocks less expensive now for money managers in Paris and Frankfurt than they were for American investors near the end of the bear market in 2002, when S&P 500 companies sold for a record 42 percent less than the average global ratio.

Interesting take that I had not thought about.

I am having a tough time buying even individual stocks in this market

It just feels too complacent for the situation the world is really in to me (unemployment, higher taxes coming, govt debt, cost cutting earnings beats, inventory restocking GDP bounce). Feels like people are just buying because the market is going up and not on some real long-term thesis (possibly a lot of stock renters here rather than long term buyers). I am worried about some event happening that refocuses investors on the risk and valuations in the market. I feel even if I own good companies everything will get pulled downward. I still own my RINO (which made a new 52 week high today), but other than that I only own gold stocks, precious metals, small long DBA (Ag), short the long term treasury and got long the VIX this morning. I also have my short S&P on from 1055 and loosened the stop to 1100 on this minor position to keep some hedge on my longs (actually thinking about adding short on a spike through 1080 which looks likely). Today, financials and REITS look weak early (may be other places to looks short although GS and JPM report this weak and they will probably "beat" expectations for what that is worth today with all the accounting garbage at these institutions).

Maybe my mindset is that of too many as sentiment isn't really bullish which often occurs at market turning points and we blow straight through 1100 S&P. However, I can not put new money into the market based on technical momentum and sentiment readings when I "feel" a negative market changing event brewing. Yeah I may miss a few percent but I feel the downside risk is greater so I sit on my hands...


Dollar reaches breaking point as banks shift reserves

Bloomberg.com reports central banks flush with record reserves are increasingly snubbing dollars in favor of euros and yen, further pressuring the greenback after its biggest two- quarter rout in almost two decades. Policy makers boosted foreign currency holdings by $413 billion last quarter, the most since at least 2003, to $7.3 trillion, according to data compiled by Bloomberg. Nations reporting currency breakdowns put 63% of the new cash into euros and yen in April, May and June, the latest Barclays Capital data show. That's the highest percentage in any quarter with more than an $80 billion increase... The diversification signals that the currency won't rebound anytime soon after losing 10.3% on a trade-weighted basis the past six months, the biggest drop since 1991.

Sunday, October 11, 2009

Is DOW 10,000 inevitable this week?

Do we have to at least kiss 10k just to do it before any selloff can happen?

Lots of big earnings this week, surely the banks will beat with crazy accounting and one time gains... will investors keep buying "it"?


Friday, October 9, 2009

The TBT long from yesterday works briliantly - maybe a new swing

The TBT long from yesterday has worked for over $2. This is the ultra short long term US treasury. Clearly looks like a trend change in long term bonds after yesterday's auction. If you follow this blog you know I am already short a core position in long term UST's.

A new possible swing today I am looking at is the VXX (currently at $47.35). Basically, an ETF that tracks the VIX ("fear gauge") of the market. Note: this ETF isn't perfect from a tracking perspective and is not a long term hold.

CDC just said swine flu epidemic in the US so volatility could return. However, the market is testing highs after the release?



Thursday, October 8, 2009

Music from ALO

kind of groovy and funny...





If it's not the dollar - BUY IT

Dollar down, everything else up - even treasuries? what?

This will work until it doesn't and could end badly.

That said the short play is clearly loaded so a-squeezing we will go...

wish i would have waited for a retest of highs before committing short, now I may get stopped and watch us reverse down. so my gut was wrong on that short - it happens, possibly take the loss and move on...

my long precious metals positions are up nicely but my shorts are cutting into gains.

thinking about swinging a TBT long.



Tuesday, October 6, 2009

Shorting into this rally at S&P 1053

stop above recent highs (about 2% above) - this is a swing short



Monday, October 5, 2009

Precious metals finally going to start the "REAL" breakout

Precious metals (PMs) were up today with gold getting very near its all-time high again today. One thing I noticed last week was that the PMs were strong even when the dollar was up and the market was down which is a divergence that could have been the tell for this next move higher. Plus, I have been hearing alot of people talking about gold pulling back lately (even bulls on gold saying I will rebuy lower). That is usually when those "experts" are surprised and miss the first 5-7% of the next run. I would imagine a lot of stops are set right above all time highs and new money will come in at that same point.

More on my thoughts on the PMs later this evening.

RINO (Rino International) Rally Monkey!





Sunday, October 4, 2009

Friday, October 2, 2009

Buying some trading shares in RINO (RINO International) this morning

Stock has sold off from almost $22 yesterday to $18 this morning (premarket). 10 DMA is a little below $18.

Remember this Company will work in any economic environment because China has mandated that their customers install RINO's systems. Also, if you net the $2 a share in cash out of RINO's stock price @ $18 you have a forward PE of 7.5. Someone in the comments section suggested a $150 stock price for RINO in 3 years! I guess that would only put the market cap at $3.75 billion so that's not that huge... Discuss that idea in the comments section below?

By the way maybe I should change the blog to the RINO blog since that's all I have been writing about...


Tuesday, September 29, 2009

More color on RINO (Rino International) and why this monster may just be getting started

This is a blurb from briefing.com - a great info tool you should think about paying for

"RINO is a small cap name we have been following for a while. We initially wrote it up on Jun 24 at $8.75, when it was still trading on the bulletin boards (see InPlay archive). The stock is up 130%, but since then, the co has reported strong Q2 results and the Chinese government has announced tougher pollution controls, so we wanted to revisit the story.

Rino makes environmental protection equipment for the steel industry in China. Specifically, Rino makes wastewater treatment, flue gas desulphurization (FGD) equipment, and high temperature anti-oxidation systems, which are all designed to reduce industrial pollution. To provide some quick background, the sinter at a steel plant contains equipment where powdered iron-ore is mixed with coking coal. This results in significant amounts of air pollution, including SO2 (sulphur dioxide), NO2 (nitrogen dioxide), dust and metal particles. Rino was the first company in China to develop an FGD system specifically made for the sinter. It curbs pollutants and reduces SO2 emissions by up to 99%. As a result, Rino has a first mover advantage and a dominant market position (of the 40 sinter FGD installations in China thus far, Rino accounts for 28 of these.)

As part of China's pollution reduction initiative, the Chinese government recently announced a plan which calls for the number of sinters to be equipped with FGD systems to double annually through 2011. China is estimated to have about 500 sinters, less than 10% of which have been equipped with FGD systems. Rino anticipates its growth will accelerate over the coming year as the government mandate creates an impetus for steel cos to become compliant. Rino has seen new bidding activity pick up and is currently pursuing a couple of very large sinter projects. If you run the numbers, that's a lot of potential growth. There are currently 40 FGD installations, which should double to 80 next year, then 160 in 2011.

A quick look at the financials shows the company is doing well. The co is profitable and 1H09 revenue rose 42% yr/yr to $76.3 mln and EPS more than doubled to $0.89 on nearly 30% operating margin. The balance sheet is solid with $52 mln in cash/inv, or about $2 per share, and no LT debt. Looking ahead, Rino expects to soon begin construction on a new production facility that should be operational next summer. This will significantly expand Rino's production capacity and allow the co to take advantage of the new FGD regulations.

On a final note, we think Rino is still below many radar screens as it only recently came over from the bulletin boards. Also, even after its strong run, it trades at a forward P/E of just 9.6x (one estimate), so it's still attractively valued. However, it made its debut on the IBD 100 at #2 today, so we expect that will raise its profile. Mkt cap $504 mln, float 7.2 mln, avg vol 512k."

I have been in since the 11-14 range and think RINO has $25-$30 potential in 2009



Monday, September 28, 2009

RINO roars, RCON posts $1.04 EPS

RINO rips up over $20 after entry into the IBD 100.

RCON posted their year end numbers today which were $1.04 basic EPS and .99 diluted. Stock trades under $10 with 1.7 million float. Company has a conference call tomorrow morning which will be worth listening to. It only has a 1.7 million share float, so if the momos want to run it they certainly could easily. That said, it needs to get more exposure to really get going...



Saturday, September 26, 2009

RINO (Rino International) goes into the IBD 100 at #2

As I said it would a month or so ago if it closed above $15 on any upcoming Friday. RINO will get huge exposure from the IBD (Investor Business Daily) and I see over 700,000 short and its debut is at #2. This could be interesting on Monday expecially if the overall market stabilizes. You can search the blog (mid-right of the page) for more color on RINO.

This has momo, but it's not just a momo stock as its fundamentals indicate higher prices that are substantiated.

The IBD 100 defined:
The IBD 100, which runs every Monday in the IBD newspaper and can be found in the Screen Center on Investors.com, is a computer-generated ranking of leading companies trading in the U.S. Rankings are based on a combination of each company's recent profit growth record; IBD's Composite Rating, which includes key measures such as return on equity, sales growth and profit margins; and relative price performance in the last 12 months.



Thursday, September 24, 2009

Market down - but watch for a quarter end markup?

I would think the funds might put a little buy pressure into the end of the quarter, but they have put a lot of buy pressure over the last 3 months so let's see how they close September?

Not a lot of buying enthusiasm today.

Tuesday, September 22, 2009

Big Day for The Honest Trader

Gold, silver and metals stocks up big... and my small caps were up big again. RINO broke out on all time high volume and RCON could be on it's way to running into its earnings release next week. Daddy got paid today, but tomorrow is a new day.

Dollar down again and the market is up again - what else is new?


Dollar seems to be driving the market everyday.

Check this chart of the S&P versus the $ over the last 6 months... apparently the plan is make the dollar worth"less" and other assets can shoot up and make people feel better... that is until consumers start seeing the pain of inflation.





Monday, September 21, 2009

RINO mentioned and recommended on CNBC

at about the 4:17 mark our RINO was mentioned on CNBC... link below

http://www.cnbc.com/id/15840232?video=1269517851&play=1

not often that my smallcaps get on CNBC...



Been awhile since I posted some music

All this guy plays is chill music... relaxing, with a weird name Donavon Frankenreiter and a killer "stache".






Sunday, September 20, 2009

Ken Fisher is a F'ing Idiot



This guy is an f'ing idiot and a permabull. Does he really believe what he is saying? People let this guy manage $35 billion of their money?

I heard this guy speak directly a few years ago before everything went to hell and he was preaching pretty much the same thing.


Friday, September 18, 2009

Paycheck to paycheck

Interesting blurb from Agora Financial.

30% of Americans making $100,000 or more each year are living paycheck to paycheck, reports a CareerBuilder study this week. That’s up from 21% last year -- a number that still seems awfully high.

61% of all Americans say they are in a similar bind… making just enough to finance their lifestyle every month. Just a year ago, 49% were living paycheck to paycheck.

The No. 1 way to make ends meet on a tough month? Cut savings. Check out these quick stats:

· 21% of correspondents have reduced or eliminated 401(k) contributions in the last six months
· 36% don’t put any money toward retirement
· 33% don’t save at all
· 30% that do put some away save less than $100 a month.

Puts an interesting twist on the much belabored rising savings rate, doesn’t it? The personal savings rate as reported by the government has nearly doubled from this time last year -- from roughly 2.5% to 5%. But to what end?


Thursday, September 17, 2009

Hot stock of the day is TRIT (Tri-Tech Holding), some similarities to our Recon (RCON) and RINO

Tri-Tech Holding, a Chinese company that designs systems to manage and monitor China's municipal sewer systems, natural waterways and resources is up big again today. This is based a newsletter recommendation from what I gather. The company looks interesting. It has aspects of one I really like and have mentioned here - RINO (and also DGW). You can search the blog for that commentary (search box is on the right of the blog about halfway down).

As you know we have owned RCON (Recon Technology) from the $6's and while not in the same business there are a lot of similarities that could spill more momo over to RCON. The companies both have a 1.7 million share float and were both brought public by the same underwriter, both are Chinese. So in a sense RCON may turn into a secondary momo play on TRIT and possibly vice versa eventually. RCON is slightly smaller with less total shares outstanding.

Also, RCON earnings will be out within the next week and a half and I expect north of $1 in EPS.



Tuesday, September 15, 2009

Gold to $4,000? Peter Schiff says so...




The Greatest Sucker's Rally of All-Time?





Ron Paul on the Fed





Back from Vacation

Was a good vacation and my positions moved mostly in my favor as I was gone.

Especially RCON and the precious metals were rolling.

Dollar continues to go down and the market continues to go up.

I'll be back to more regular updating later this week.

Tuesday, September 8, 2009

RCON (Recon Technology) & RINO (RINO International) with good news today

Recon Technology Secures $971,000 in New Equipment Orders for Chinese Oil and Gas Fields

RINO International Corp. Introduces New DXT Desulphurization System

I still am long these stocks and think both have more to go on the upside. RCON should have earnings shortly and remember the float on RCON is 1.7 million.


China alarmed by US money printing - Daily Telegraph

Daily Telegraph reports the US Federal Reserve's policy of printing money to buy Treasury debt threatens to set off a serious decline of the dollar and compel China to redesign its foreign reserve policy, according to a top member of the Communist hierarchy. Cheng Siwei, former vice-chairman of the Standing Committee and now head of China's green energy drive, said Beijing was dismayed by the Fed's recourse to "credit easing". "We hope there will be a change in monetary policy as soon as they have positive growth again," he said at the Ambrosetti Workshop, a policy gathering on Lake Como. "If they keep printing money to buy bonds it will lead to inflation, and after a year or two the dollar will fall hard. Most of our foreign reserves are in US bonds and this is very difficult to change, so we will diversify incremental reserves into euros, yen, and other currencies," he said. China's reserves are more than -- $2 trillion, the world's largest. "Gold is definitely an alternative, but when we buy, the price goes up. We have to do it carefully so as not to stimulate the markets," he added. The comments suggest that China has become the driving force in the gold market and can be counted on to buy whenever there is a price dip, putting a floor under any correction.

lots more stuff on gold I will be posting but on VACA so might be slow.

Sunday, September 6, 2009

Going on Vacation

be back in a week.

Where will gold be? Where will the market be? We will see.



Wednesday, September 2, 2009

Gold/Silver/Gold Stocks Breakout

As mentioned before here I have been long precious metals for the whole year and it my be breakout time. If you are not long buying a pullback might be the way to go.

It could get interesting...



Tuesday, September 1, 2009

Market Dump...Precious Metals Pump!

Must say I am not surprised, but could see some back and forth but I think medium term we are probably headed south in the market.

Of note - gold and silver outperforming and breaking the recent correlation with the stock market. Do the precious metals soon breakout. I do believe seasonality is on their side.




Wednesday, August 26, 2009

RINO (Rino International) Update - IBD 100 Potential Runner

RINO as I have mentioned before should be a top 5 IBD 100 candidate (search blog for my discussion of IBD 100) if it close above $15 on any upcoming Friday (now near $13.5). As you know I re-entered this when in bounced off of its 50 DMA down in the $11 range after taking an initial loss. Does this means RINO gets to $15 this week - by no means. I am simply pointing it out as past IBD entrants have been runners and as always just for entertainment purposes as nothing I say is a recommendation to buy other than for myself (so any time I say pick or recommendation it is simply my personnel decision). I simply blog to share my journey through the markets. Do your own research as that is the only way to invest.

Also, nibbling towards getting back into a full position on RCON before earnings as this has sold down too far prior to earnings imo (although in retrospect I should have sold more on the initial pop to $9.5 - but hindsight is 20/20). If you take out RCON's cash of $2.5 a share the business is "selling" for $3.5 a share which on pro forma earnings (taking the new shares into account) is like a 5-6 current PE and maybe a 3-4 forward PE. Seems way cheap for a growing company and it has 50%+ insider ownership so you know management's interests are aligned. That said, this thing can not find a bid (maybe it needs to sweep the stops at 5.99 before this decent can end).


Tuesday, August 25, 2009

Market starting to feel heavy

and everyone is scared to short into it... does that mean a reversal may be coming. I think it might. Oil tirned south today and that could be the initial tell. However, short has been wrong and long has been right for the last 50% in this market so who knows. After Labor Day volume should return.



Monday, August 24, 2009

Goldman's Trading Tips - Doesn't seem right...does it?

The Wall Street Journal reports that critics complain that Goldman's distribution of the trading ideas only to its own traders and key clients hurts other customers who aren't given the opportunity to trade on the information. In fact, every week Goldman analysts offer stock tips at a gathering the firm calls a "trading huddle." But few of the thousands of clients who receive Goldman's written research reports ever hear about the recommendations. At the meetings, Goldman analysts identify stocks they think are likely to rise or fall due to earnings announcements, the direction of the overall market or other short-term developments. Some of their recommendations differ from ratings printed in Goldman's widely circulated research reports. Some Goldman traders who make bets with the firm's own money attend the meetings. Since the trading huddles began about two years ago, Goldman has supplied "trading ideas" on hundreds of stocks to the traders and top clients, according to internal documents reviewed by The Wall Street Journal. At least one firm discloses such trading tips more broadly: Morgan Stanley (MS). Their research dept. sends blast emails with short-term views on various stocks to thousands of clients, and posts the information on its Web site. It doesn't call customers to convey the tips, because co officials decided that could expose the firm to questions about selective disclosure, according to people familiar with the matter.

As I have mentioned before Goldman trades one way in private with their own money and says a different thing in public. Not right, man.


Friday, August 21, 2009

Morning Commentary

Market continues its leak north.

Oil looks to be a a breakout point. Gold/Silver up early. If oil breaks out it may be worth looking at some smaller cap oil plays for momo buying over the short term. We have some exposure there with RCON, but there are other ways to play that with past momo oil runners.

It's hard for me to get excited about being long at these market valuations, so I will stay away. But as a trader sometimes you have to trade what you see not what you think.

Also, RINO perking up this morning. The more I research this one the more I like it. If it dips again into the 11's I will add more. I think this definitely gets over $15 before end of 2009.

RCON Update - Apparently this company is ringing the bell on the Nasdaq next week. This could give the company some additional exposure and it wouldn't shock me to see earnings around the same time for max effect. We'll see.



Thursday, August 20, 2009

Video Discusses Buffett's View on US Spending



The underlying bid remains

Markets continue to leak north. Interesting to see the continued strength in both the stock markets and the US bond markets.

Also, worth noting that the US markets seems to be keying off of China lately. Just something to note because the US historically led the way...

Other things I am watching are oil at a potential breakout/resistance point and financials as those seem to lead us up or down.

Other than that just chillaxin' (chilling and relaxing combo word!)!

Wednesday, August 19, 2009

Demand for gold slumps to six-year low - Daily Telegraph

Daily Telegraph reports demand for gold has fallen to a six-year low in the last quarter as big gold-buying countries such as India and Turkey retreated from high prices. Jewelery buyers, who are the main drivers of the gold price and make up more than 50% of consumption, withdrew from the market with volumes down by 22% in the last quarter. Electronics producers, which need gold for components such as smart-cards, cars, medical implants and sensors, also appear to have been buying less of the precious metal as consumer confidence remains depressed. Rozanna Wozniak, investment research manager at the World Gold Council, said that despite a drop in gold jewelery sales, demand for gold as a long-term investment prospect rose by 45% over the last three months. Traders are still clinging to the commodity as a safe haven during the recession and central banks bought 14 more tons of gold than they sold -- their first net purchase for the last decade. "We have seen pockets of demand coming back and people looking for opportunities to buy back in but the biggest factor in lower demand is the 31% rise in the gold price since last year," she said.


This is interesting... what to make of it a bullish or bearish signal? I like gold long term as a asset class to own.

Markets recover early losses as dollar heads south again

The dollar down / market up game is once again in vogue. Surprised that US Treasury bonds are up... I guess it is a long-term bond monetization day for the Fed as they were in the "market" buying US debt. For some reason people have been bidding the hell out of UST the last week.




Buffett says the US could become a Banana Republic? Kind of.

Click read more for article


WASHINGTON (Reuters) - Billionaire investor Warren Buffett said the U.S. economy has avoided a meltdown and appears on a slow path to recovery, but Congress must now deal with enormous amounts of debt that threaten to erode U.S. purchasing power.

In an opinion column published on Wednesday by the New York Times, Buffett wrote that he "resoundingly applauds" actions by the Federal Reserve and the Bush and Obama administrations to pump trillions of dollars into the financial system.

But the "gusher of federal money" has run up a high level of debt that could fuel inflation, he said.

"The United States economy is now out of the emergency room and appears to be on a slow path to recovery," Buffett wrote.

"But enormous dosages of monetary medicine continue to be administered and, before long, we will need to deal with their side effects. For now, most of those effects are invisible and could indeed remain latent for a long time. Still, their threat may be as ominous as that posed by the financial crisis itself."

Buffett, who runs insurance and investment company Berkshire Hathaway Inc, likened the economic threat of "greenback emissions" to the environmental threat of greenhouse gas emissions, leaving the United States with a deficit of $1.8 trillion or 13 percent of gross domestic product this year.

In July, the government posted a $180.68 billion monthly budget deficit, a record for July, marking only the third time in the past 30 years that the government ran a deficit for 11 months in a row.

Buffett said a revived economy will not be able to generate enough revenues to bridge the gap between outlays and receipts, so changes in taxes and spending will be required.

Politicians will not likely have the will to raise taxes or slow spending, so they may opt to quietly let inflation increase, a move that will "confiscate" wealth and allow the United States to evolve into a "banana republic economy", he said.

"Our immediate problem is to get our country back on its feet and flourishing -- 'whatever it takes' still makes sense," Buffet said in the paper.

But once recovery is gained, Congress must end the rise in the debt-to-GDP ratio and keep its growth in obligations in line with its growth in resources, he wrote.

"Unchecked carbon emissions will likely cause icebergs to melt. Unchecked greenback emissions will certainly cause the purchasing power of currency to melt. The dollar's destiny lies with Congress," he said.

Last month, in a newspaper column of his own, Federal Reserve chairman Ben Bernanke, said the huge amounts of money the U.S. central bank has pumped into the economy will not undercut its ability to push borrowing costs higher when the time is ripe.

Stressing that the weak U.S. economy will likely warrant exceptionally easy monetary policies for a long time to come, Bernanke outlined in a Wall Street Journal opinion article how the Fed could raise interest rates even with cash flooding the financial system.

"At some point, however, as economic recovery takes hold, we will need to tighten monetary policy to prevent the emergence of an inflation problem down the road," Bernanke wrote.

The outline of the Fed's "exit strategy" from the extraordinary monetary policy easing it has undertaken in the past two years to deal with the global financial crisis was the subject of testimony to Congress by Bernanke in his twice-a-year economic report on July 21.
...Read more

Tuesday, August 18, 2009

Recon Technology (RCON) Update - Still Like This One For Potentially Big Gains

RCON continues to fade on low volume and had a disappointing day today as it did not rebound with the market. Fact is this thing just doesn't get any attention (and small amounts of selling are dropping the stock). However, when a few bigger fish fall onto this one or when it reports north of $1 in EPS within the next few weeks, a run to the double digits could be a quick journey as with its microfloat it moves both up and down quickly. Search RCON in my search my blog section for more on RCON. I still like the stock (for a swing trading long through earnings) though for those asking what I am doing (I took a little off when it ran 50% from my initial recommendation price, but still hold the majority of the position and will scale in back to a full position on any additional weakness back towards $6.)

RINO Re-entry


I got back on the RINO bus as I mentioned I might yesterday. Today we see a nice bounce off the 50 DMA. And my stop is slightly below yesterday's lows. The valuation and tech setup was too good to pass up despite the bad timing on the initial call.




Monday, August 17, 2009

OUCH!

Longs getting murdered / commodities getting murdered / RINO/RCON getting murdered...

at least my short positions are up big, but not overtaking the losses from my long positions in other areas today.

Stopped out of RINO, but may look to re-enter as now the valuation looks really compelling, but hard to fight the tape here. Sorry about that pick...clearly my worst of 09 from a timing perspective. Still, think it goes back over $15 in 09, but my timing was off so I was wrong on that trade.

One thing to remember in this market is take some profits when you have them because in one day or a few days a lot gains can be erased (RINO from almost $18 last week to 11 today - at least I only rode that down for $2. However, a lot of people saw huge gains erased there in a very short period. Tough thing there is it just looks way oversold and sells at 5x forward earnings (and 4.5x if you net out cash). So, at $11 given a 3-6 month time horizon I'd want to be long this.)



Saturday, August 15, 2009

Have a good weekend

I'll be back later this weekend with some additional thoughts.



Thursday, August 13, 2009

A potential IBD 100 trading idea - RINO (RINO International Corporation)

This is a stock that has had a big move but pulled back since reporting good but not good enough earnings after strong move. It's another China play (like my recent picks RCON, DGW - you can click the blue RCON for that recommendation) - this time on environmental protection equipment. Has been compared to DGW which is a water treatment IPO that I nailed for a 50%+ gain this year. You may say why buy now? after the big run? after earnings? what is the catalyst. It's the IBD 100 potential it has. You ask what is IBD 100 potential? IBD 100 is a list of 100 stocks that are profiled in Investor's Business Daily a widely read and respected investing newspaper every weekend. To be on the IBD 100 you have to meet "black box" criteria from IBD that qualifies you. Basically the rankings are based on earnings and relative strength. After RINO's recent earnings report it now has a 99 EPS rating and a 99 relative strength rating. This is as high as it gets, but RINO is not yet in the IBD. The reason is a stock has to be over $15 to get into the list. There is often a natural attraction for traders to identify these IBD plays under $15 and push them over the $15 so they get included in the list and get additional exposure that can cause some stocks to run (check FUQI for an example of a runner after getting above $15). Also, with a 99/99 it should be in the top 10 on the IBD list if it closes above $15 tomorrow or any Friday soon. So for a trade buying RINO here around $14 should be good for at least $1 and maybe a lot more. I bought today at $14 and will add if it dips down to $13.5. My stop goes under $13 for now.

Besides all this IBD stuff the company made 89 cents in the first 6 months of 2009 and has growth ahead of it. Therefore, if you double that .89 you get about $1.80 in earnings and the stock trades at only $14 so it has a pretty compelling stand alone valuation angle to it as well.

A little more color on RINO

Rino makes environmental protection equipment for the iron and steel industry in China. Specifically, Rino makes wastewater treatment, flue gas desulphurization equipment, and high temperature anti-oxidation systems, which are all designed to reduce either industrial pollution and improve energy utilization. Rino does make equipment to ensure than steel producers in China are not polluting water supplies. Rino is also set to benefit from the Chinese government enacting stricter environmental standards.


What's going on today - a lot of nothing

Market bouncing around today a lot as the indecision is evident (with what feels like an underlying bullish bias). Stopped out of the rest of my TBT for a 50 cent gain (sad thin is premarket this was up $1.2 more) today as the long bond auction is being hailed as strong (I will look to reenter around "fitty"). Economic data this morning was poor in my opinion and does shoot some holes in the "green shoots" bull$hit. Imagine media will spin it like they always do! Nevertheless, traders are turning a blind eye to eco data as I think big money thinks they have some shorts that need to be squeezed before this episode of the market's pump turns into a dump. I guess I am saying a further squeeze up would not surprise "this guy". That said dollar is down again and this is how the market could stay up regardless of fundamentals for a period of time I guess.

My guess is Goldman will ride the wave all the way down like they did all the way up. Remember these are the guys who analysts said oil was going to $250 last year but somehow all their traders made fortunes shorting oil from $140 to $35!



Wednesday, August 12, 2009

Short Interest way down in July - Contrarian Sign?

Short interest on the S&P 500 is down to its lowest level since February. Investors were short 8.7 billion shares of the index at the end of July, Bloomberg reports today. That’s a 12% drop in just two weeks. Shorts reduced bets against financials the most, down 31%.

Make of this what you will, but feels like one piece of the contrarian puzzle that has me starting to lean short again. That said, I am not committed to the short side yet as it feels like we may get a few more pushes or consolidate for a while before we move back down.



Selling 1/2 of my TBT from yesterday for $1.15 gain - nice trade

As I mentioned yesterday my trade was only for $1-2 on this TBT. Therefore, taking half off for $1.15. Moving stop up to 51.49 on the remaining piece.

10 yr UST auction results sort of weak here so could go further but locking in gains ahead of the Fed.

Nice, low stress gain on this one for me.

I still maintain a longer term bearish position and view of long term US bonds.



Tuesday, August 11, 2009

Update on positions, one new trade - TBT Long

I just bought the TBT (2x short long term treasuries at $50.9). Took a 1/2 position will buy more at $50 if it gets there. A little risky in front of the Fed but less so now that it has sold off the past few days. Looking for $1-2 on this trade as I already have a core short position in long term treasuries through a short on the TLT.

Letting my remaining short positions from Friday ride (as of right now) with stops moved up as these are nicely in the money now (between 2-10% depending on the trade).

I am also eyeing GLD for a trade but have not taken it.



Monday, August 10, 2009

Locking profits on 1/2 of my short exposure from Friday afternoon

As mentioned here I bought SRS/SKF and shorted some additional SPY on Friday afternoon. I am banking profits on half of my exposure. I think we have more to pullback but going to take the solid gains in one day off the table, especially with the longs continued late day squeeze fetish still in style.

The SRS good for 6%, SKF for 3.0%, SPY for 1%.

Saturday, August 8, 2009

Recon Technology, Ltd. Profile – A Small Cap Chinese, Energy-Focused, IT Company

Recon Technology (RCON) is an interesting microcap company that IPO’ed last week which I think has huge potential for gains in the near and long term. First, the company is very small, so if you don’t like volatility you can stop reading right now as the company has a current market cap of around $30 million.

What does the company do? Actually it looks pretty interesting. Recon Technology, Ltd. provides computer software and hardware solutions to companies in the petroleum mining and extraction industry in China. The company engages in the sale and installation of hardware systems related to heating, maintenance, and processes customized for petroleum extraction. Basically, the Company provides services designed to automate and enhance the extraction of petroleum and it focuses and is located in China. RCON is the first Chinese non-state-owned oil and gas service company to go public in the US.

What do I like about the Company? Quite a bit.

Proprietary Technology - The Company does have proprietary products with 3 copyrights, 8 patents and 4 pending patents. This technology is validated by the fact that this young company’s major customers are CNPC and Sinopec. For those unfamiliar with those companies CNPC is China's largest oil and gas producer and supplier and Sinopec is another major petroleum company in China. Recon has provided services to Sinopec since 1998 and CNPC since 2000. Recon has conducted automation projects for 80% of CNPC and Sinopec's oil and gas fields, covering three of China’s four highest producing oil fields in Daqing, Shengli and Xinjiang. These seem like pretty strong relationships with growing customers.

Small Float - The Company will have 3.9 million shares outstanding after the offering. However, the shares in the tradeable float is ONLY 1.7 million shares. With this small a float you will get a lot of volatility but also the possibility of huge gains as traders buy the stock up on limited supply. This is often when momentum traders come in and things can get crazy to the upside.

Lots of Cash, No Debt – After the IPO, the Company has about $11 million in cash ($2.8 a share) and virtually no debt. That's a lot of cash relative to its current market cap of approximately $30 million (1/3 of the cap in cash).

Insider Ownership – Directors and Executives will own over 50% after the IPO and are selling no shares in the offering. That shows a strong commitment to maximize shareholder value.

Earnings / High Margins - The Company did $9.1 million in revenue in nine months ended March 31, 2009 and diluted EPS of $.83 with net income margins over 20%. Net Income grew over 57% for the nine months ended March 31, 2009 over the same nine months of 2008. The Company should report year end (June) results in the near future and I’d expect approximately $1.10 in EPS for the year on strong top line growth. That would put the current PE at around 7.5. If you assume earnings growth of 50% for 2010 EPS which I think is reasonable based on the base size of the company and the potential usage of the proceeds of the offering for growth you get 2010 earnings of $1.60. That would put the one year forward PE based on these estimates at approximately 5. That seems cheap to me and sounds like a stock with multi-bagger potential.

Conclusion: RCON is a growing microcap company ($30 million market cap) focused on a strong market segment and has quite a bit of sexiness to it. RCON is an IT company, it provides services to the energy industry, and it’s the only non-state owned Chinese oil and gas service company public in the US with great customers. Additionally, earnings and growth could indicate that the stock is undervalued and I expect this stock to hit radars once it publishes June results and reports over $1 in EPS for the fiscal year. With the Company’s float being so small, the stock could get bid up significantly and have the fundamentals to back the price gains up unlike many other small float momentum plays. I like it right here at $8 a share.

Disclosure: As pointed out on this site before I am and have been long RCON and my blended basis is around $6.50.

Also, readers let me know if you like these profiles... if so, I will continue to write them. If not, I won't - how's that sound?

Friday, August 7, 2009

Market likes the employment data early today, what about later?

Some OK things that CNBC will be jumping up and down about but it's not "all good". Excerpt below is with the help of briefing.com (a great info site).

"Payroll losses were reported across nearly every major category, with the exception of small increases in education and health services (+17K), leisure and hospitality (+9K) and government (+7K). Additionally, 1 out of every 6 workers over the age of 16 still lacks full-time employment. The number of discouraged workers was 796,000 in July, up by 335,000 over the past 12 months.

The difficulty in finding a new job is best reflected in the extension of the average duration of unemployment to 25.1 weeks from 24.5 weeks. This is the highest since records began in 1948. More alarmingly perhaps is that 1 out of every 3 unemployed workers has been unemployed for 27 weeks or longer."...briefing.com

Total number of jobs lost since December 2007 is 6.7 million. That's nothing to party about if you are this guy.

Could this be the pop to short as the big boys sell the news this morning. It could be and I will be looking to add to my short line sometime today if the action dictates the momentum is fading... that said, the squeeze play has been in vouge so watch out players.

9:52 update: Market hanging pretty well... the longer they prop it up more likely we squeeze through the highs. Financials holding well so far and they have been your leaders. Do we get the blow off top today? 1014/1015 in S&P will be a tech hurdle...

3:15 Update: Going against the recent grain and short into the last hour. Most days the market has squeezed the last hour. Still, shorting some financials/REITS (using SKF/SRS) in addition to adding to my S&P short slightly.



Thursday, August 6, 2009

Chart of the Market in the Depression and Today - WOW!

Look at the chart below - today's market almost a mirror of 1929-32. If we are going into a similar cycle watch out below because this rally may be near it's end. In fact I laid a small short line on the S&P out today. I will be looking to add if we can have one last exhaustion spike...

Need more evidence..from October 29, 1929 until November 13, 1929, the stock market collapsed 49% (2008's was 52%). The market then staged a 155-day rally of 50%. Today’s rally (starting in March ’09) has lasted 150 days and the market is up an average of 50% (average of Nasdaq, DJIA, and S&P 500). The 1929 market then rolled over and collapsed another 70%. Spooky $hit...



Chart and some commentary from Gains, Pains and Capital.



BoE raises quantitative easing total to 175 bln sterling - more priniting!

BoE raises quantitative easing total to 175 bln sterling, holds rates - Reuters

Reuters reports the Bank of England extended its quantitative easing programme on Thursday, raising the size of its bond purchase scheme to an unexpectedly large 175 billion pounds from 125 billion, and held interest rates at 0.5 percent. The decision enables the central bank to continue its programme of asset purchases with newly created money -which it started in March to boost Britain's recession-hit economy- as the last of the 125 billion pounds was spent in late July. "The Committee expects the announced programme to take another three months to complete. The scale of the programme will be kept under review," it said in a statement. Economists had been evenly split on whether the BoE would choose effectively to print more money to buy assets such as government bonds and corporate debt. None had expected a change in Britain's record-low interest rates. The BoE has received approval from Britain's finance ministry for the extra money. When the BoE launched quantitative easing with an initial 75 billion pounds in March, the finance ministry had allowed it to create up to 150 billion pounds of new money.

Everyone printing - it's the thing to do I guess. Hey, it makes the markets feel good everytime they do it, it seems. Destroy all currencies and let other assets move up. I also like that they refer to this as a scheme in the article.




Wednesday, August 5, 2009

Recon Technologies Inc. Video - Finally Getting Noticed!

This thing is up 50% since I recommended it at $6 last week... nice. Like I said, momo traders picking it up and I expect $1.10-$1.20 to be reported in the next couple weeks so you could argue it's still cheap. Would $15+ be out of the question?

Also, DGW up another 7%+ today... hope you guys have bought some of these most recent rec's.

This thing is up 50% since I recommended it at 6 last week... nice.


Nearly half of mortgages seen underwater by '11 - That's not good!

Reuters.com reports the percentage of U.S. homeowners that owe more than their house is worth will nearly double to 48 percent in 2011 from 26 percent at the end of March as home prices continue to fall, Deutsche Bank said. Home price declines will have their biggest impact on "conforming" loans that meet the underwriting guidelines of Fannie Mae and Freddie Mac, the bank said in a report. Of those conforming loans, 41 percent will be "underwater" by the first quarter of 2011, up from 16 percent at the end of the first quarter 2009, it said.

This is a remarkable stat - if true. What does this mean? The pain ain't over for banks that's for sure. Do you feel like walking away from your house...many will.



Treasury plans for more sales of TIPS - because China says so?

WSJ reports the Treasury Department, seeking new ways to help fund its budget deficit, is likely to announce on Wednesday a plan to ramp up sales of inflation-protected bonds, according to people familiar with the matter. China, the largest holder of U.S. government debt, is among investors that have indicated to the Treasury that they want to buy more of the securities, which offer protection against rising inflation, the people said. Officials from the U.S. and China discussed TIPS issuance at high-level talks in Washington last week. U.S. officials assured their Chinese counterparts that they remained committed to TIPS sales, according to a person with knowledge of the discussions. China has accumulated more than $2 trillion in foreign-exchange reserves and has invested about $800 billion in Treasurys. The TIPS announcement will likely come as part of Treasury's scheduled announcement on funding for the third quarter, the people said.

It would seem China sees the possibility of inflation and wants to be protected (to some extent). I don't blame them.



Tuesday, August 4, 2009

RCON - Recon Technology: Moving up near all time highs on strong volume

Don't blink because this thing could be at $8-$9-$10 in a blink with its microfloat... the flip side of that is it could be back at $6 in a blink too. I am playing the long side and can certainly see this thing become a momentum favorite as it has some real fundamentals and is in an interesting sector - China, energy, tech, low PE, low float. That could seem sort of sexy to traders...

Also, my previous pick DGW up 7% today and about 50% since my rec a few weeks back. Precious metals up, UST bonds down, let's get on a roll folks.



Goldman tells employees to stop acting "Goldman"

Goldman Sachs CEO tells employees to avoid making big-ticket, high-profile purchases - NY Post (164.10)

NY Post reports co CEO has warned his employees to avoid making big-ticket, high-profile purchases as the gold-plated Wall Street co hunkers down amid a firestorm of public and political anger over outsize bonus payments. According to sources at the bank, Blankfein says purchases should be toned down in light of the billions in bailout money that banks, including Goldman, have gotten from Uncle Sam. A source within the bank said Blankfein first began calling for an end to the conspicuous consumption late last year, but has stepped up his campaign in recent weeks as the White House has sought to rein in compensation and as the co has gotten dinged by a pair of high-profile magazine articles. "This is a sensitive time for us, and [Blankfein] wants to make sure that we're not being seen living high on the hog," said one Goldman exec.



Monday, August 3, 2009

"A lot of room to the upside for gold"




DGW - one I have mentioned many times before

reported great earnings after hours. DGW I rec'd at under 22 and it will open tomorrow above 33 - nice move.

I see a similar result when RCON reports results this month. The full year earnings on that stock could be $1.10-$1.20+ and the stock trades at $6 right now. With RCON's float of less than 2 million it could easily double within a few days after it gets recognized and becomes a momo favorite which I can surely see happening. Still, lots of risk in that one but you know that I have moved some of my chips in the pot there.



S&P 1000 - dollar wacked

Well, as I expected the rally in the S&P is looking to squeeze up to 1000 or higher here. A part of this is being driven by the dollar dropping. The commodities are working today as well. Sorry for the limited posting lately, but I have been out of town quite a bit.

Where will the rally stop - seems like there may be some more squeeze power left from where I sit, but a lot of shorts will line up at S&P 1000 that is for sure.



Friday, July 31, 2009

New very speculative pick - RCON (Recon Technology)

This is super speculative pick (but that seems to be what some readers are looking for), so be careful. The pick is RCON and is a very small IPO by an underwriter I do not know of, of a Chinese company (see the risk?). Still, it has the potential to really move as its got a microfloat of 1.7 million shares is profitable (made .87 a share in the first nine months of 2009 on big year over year growth trading under $6 and no one knows about it YET). Worth a gamble imo.

Here's the snippet from briefing...
Recon Technology IPO: tiny Chinese co that helps oil & gas companies with automation services (5.60 +0.03)

Recon Technology is a tiny IPO that snuck out yesterday (priced 1.7 mln shares at $6). Since China stocks have been doing well, we wanted to provide some quick background. The co provides Chinese oil & gas companies with automation services that increase efficiency in exploration, extraction, refining and processing. Recon's proprietary software and hardware manage the oil production and process in real-time thereby increasing extraction levels, reducing impurities in extracted petroleum and lowering production costs. Recon is the first Chinese non-state-owned oil and gas service company to go public in the US. The co is profitable with high margins (20% net margin) and posted revenue of $9.1 mln for the 9 months ended Mar 31. This is a tiny company with a $25 mln market cap. Anderson & Strudwick is the lead underwriter.

Here's the link to the prospectus.... http://sec.gov/Archives/edgar/data/1442620/000119312509128511/ds1a.htm



Friday, July 24, 2009

Good Morning Traders - What's up?

DGW is... this is actually the only individual stock I have ever touted on this site. Hope you got some as my $30 target is in reach (premarket trading at $29).

I will try to add more individual stock selection to this site.

Market down slightly although it doesn't feel like a crash is imminent (although a 1-2% down day would not surprise me) and I see resolution to the upside before long. There is a time in the coming days/weeks were entering swing short positions in stocks/indexes will be the play, players!

UPDATE: DGW ripping almost to $31.



Thursday, July 23, 2009

You "gots" to respect the market momemtum

You will lose yo' a$$ fighting moves like this as a short. Better to step aside and let it go. Even if you are skeptical of the rally (as I am) I have for the most part not gotten drilled too bad by the 10% runup in the last week despite my bearish bias. I imagine there will be a miss by a major company soon that will cause a sell off, but with the momentum like this - too hard for me to aggressively fight it.

when you fight the momo - you usually lose because no one cares how strong your bias is - except you

Update: looks like this comment was dead on as MSFT looks like the big boy that disappointed that will lead the pullback... I was a day early on this call. still, think the market could pull back and then rip up to touch 1000. or is that too obvious?



Dollar hovering at 7 month low

for those paying attention. i have mentioned before that dollar devaluation is a reason the market could move higher than "true" fundamentals indicate. maybe that's happening here as the longs will surely look to tag S&P 1000 (in the coming days/weeks) now that we are in range... why do those round numbers end up being points that seem to always end up getting hit... it's like $100 on a stock - once it gets close it usually touches it.


Earnings for the most part are coming in better than expected again today

Still, not sure how much more the bulls can push it with out some sort of pullback. I just can't see how investors seems to think everything is fine and we are going back to the good ole' days this quickly. Nevertheless, the market isn't always rationale as we all know. Therefore my stops on my SDS is right under $50 and QID right under $28. Better be wrong and out with very small losses in this environment where the whacky happens - pretty much everyday

Update: Investor Sentiment survey out today and not really that bullish - that's not a great sign for shorts as it could indicate we have further to go before the stupid money top ticks the market.

Also, getting the feeling we may tick over yesterday's highs and then pullback as that would be the maximum frustration point for the most folks (shorts getting busted out to see the market come back at the end of the day, longs getting on board the break to get washed later in the day)... just a thought

Update: Stopped out of the short positions - well, that was pretty quick, but have to stick to the gameplan with the tight stop as longs show no signs of stopping and shorts continue to get rolled... weird to see GS struggling so much on an up day?

My old buddy DGW moving up again - getting closer to the $30 level i predicted when it was $22-23... wish I had more of that

Now, personally I hope the longs just get stupid and rip the market into the S&P 1000's... at those levels I would short with aggression for a medium term play as I see the market back in the mid/low 800's before year end.


Wednesday, July 22, 2009

Buying a little QID/SDS at the end of the day

looking for a pullback near term in the markets... these are trades and will be closed in a day or two regardless...

the SDS (2x short S&P 500)
the QID (2x short the Naz 100) - Naz 100 has been up 11 days in a row!

stops will go below today's lows in these etfs (said another way above the highs in the markets today) - so the stops are tight here. either i'm right or i am out quick.



I still own my precious metals positions ans short long term UST bonds position

Got a few emails if I still like these positions. I absolutely do although it could be a real bumpy ride I think these are great ways to both protect yourself and potentially be positioned for huge upside.

Also, are there a lot of fat people that come to my site - the lose weight ads are like the only thing that gets run here? WTF.



Tuesday, July 21, 2009

Can't stop the long MOJO - let's see if AAPL

can keep the long vibe going... since AAPL always seems to beat and then guide way low, I am sure the longs will find a way to be happy at least into the open tomorrow.

I will be a buyer of TBT (2x short long term treasuries) if it get back down to $50



Although I am not bullish - around 120 stocks hit 52 week highs yesterday

that is a little different than just oversold stocks bouncing... could bring new money in. imagine shorts will go after the open today - do the longs squeeze them out up to 1000 (S&P) or will the shorts win today.

think today is a level the shorts MAY be able to but a temporary dent in the momo, but longs have been strong and short has been wrong...



Monday, July 20, 2009

Jon Stewart rips the $hit out of Goldman Sachs

The Daily Show With Jon StewartMon - Thurs 11p / 10c
Pyramid Economy
www.thedailyshow.com
Daily Show
Full Episodes
Political HumorJoke of the Day

Feels like the market may get to 1000 before long

that would be a logical shorting spot it would seem. late shorts haven taken a wild ride the last week as the market has ripped 8% higher after taking several weeks to fall that much...



DGW ripping - on its way to $30

as I expected (searh DGW on this site for my other commentary)... just wish I had a bunch of it. Perfect example of being right but not making much money on the idea!



Analysis: Geithner's tough task: marketing US debt

From Businessweek

http://www.businessweek.com/ap/financialnews/D99HPNSO0.htm




Friday, July 17, 2009

DGW - one i mentioned before

really started to run yesterday - I hope you had some I sold most of mine pretty much at the low of the pullback for a small profit - damn. I bet we see $30 in this one before it's all said and done.



Thursday, July 16, 2009

Sheila Bair believes up to 500 more banks could fail

DJ reports FDIC Chairman Sheila Bair believes up to 500 more banks could fail, a U.S. senator said Bair told him in a recent meeting. "She told us that unless something dramatic happens, we could lose up to 500 more banks," Sen. Jim Bunning, R-Ky., said Thursday at a hearing of the Senate Banking Committee on the foreclosure crisis. Bunning said Bair made the remarks in a recent meeting. "That means that people who make mortgages in local places .... people that could really help in a foreclosure will not be there," Bunning said.

I bet this will be conservative - I bet it closes in on 1,000 when all said and done.



Wednesday, July 15, 2009

5 reasons to fear inflation

check link http://themessthatgreenspanmade.blogspot.com/2009/07/five-reasons-to-fear-inflation.html



Market rips back after looking like we were headed to 820

I really don't have a feel for where we are going but go think we could see the dollar start to break down here as the place to add to bond shorts was last week. As I mentioned then - I don't know how you would lose money over the next 10 years short US Treasury Bonds at these prices.



Robin Hood Style

Rob from the rich to give to the poor - this is the new Obama America. read more for article


House Plans to Tax Millionaires to Fund U.S. Health-Care Plan

By Ryan J. Donmoyer and Kristin Jensen

July 15 (Bloomberg) -- House Democrats plan to fund the broadest U.S. health-care expansion in four decades by increasing taxes on the wealthiest Americans, imposing a surtax of 5.4 percent on couples with more than $1 million in income.

The legislation unveiled yesterday would place additional taxes on households with more than $350,000 a year in income and calls for further increases if the measure doesn’t hit a target for cost savings. The provisions are intended to raise $544 billion over 10 years.

House leaders said the plan, which includes mandates to purchase coverage and a public health-insurance option, would cover 97 percent of Americans by 2019. President Barack Obama praised their work, saying it will “begin the process of fixing what’s broken” in the system.

“We can’t continue to put more and more money into health care,” said Representative Henry Waxman, a California Democrat who runs the House Energy and Commerce Committee. “We cannot go home for recess unless the House and the Senate pass bills to reform and restructure our health-care system.”

Obama, who has made health care his top priority, has called on both chambers to vote on their versions of the legislation before their August recess. Senator Kent Conrad, a North Dakota Democrat, says that goal may be impossible, and Richard Durbin, the Senate’s No. 2-ranking Democrat, has said the chamber is unlikely to back the surtax on high-income people, further clouding the legislation’s prospects.

1,018-Page Plan

The 1,018-page House Democratic plan builds on a June 19 draft and for the first time includes details on how to pay for the measure. In addition to the levy on millionaire households, the House would place surtaxes of 1.5 percent on couples with incomes of $500,000 to $1 million and 1 percent on those with incomes of more than $350,000.

In 2012, the White House budget office would review the estimated savings from the health-care overhaul. If the savings are $150 billion more than expected, then the government would scrap a planned second set of increases for those making between $350,000 and $1 million. If the extra savings top $175 billion, the surcharge for those incomes would be eliminated altogether.

The surtax on wealthier Americans would be imposed based on adjusted gross income, meaning it would also apply to capital gains and dividends, which are currently taxed at a 15 percent rate. House Ways and Means Committee Chairman Charles Rangel said lawmakers targeted high earners because it “causes the least amount of pain on the least amount of people.”

Corporate Taxes

The plan drew fire from the U.S. Chamber of Commerce, the nation’s biggest business lobby.

“The intention of this plan is to tax high-income households, but the real victims would be America’s small business owners,” the Washington-based group’s president, Thomas Donohue, said in a statement. “Since when does our great free-market country punish success?”

The legislation would raise taxes on larger corporations as well. Among other things, it would make it easier for the Internal Revenue Service to prosecute tax shelters, and deny certain cross-border deductions that some companies are able to claim through tax treaties.

The House is also proposing a mandate on Americans above a certain income level: People would be penalized as much as 2.5 percent of their income for failure to buy health insurance. Most employers would be required to insure their employees or pay a penalty equal to as much as 8 percent of their payroll.

Awaiting Cost Estimate

Lawmakers are waiting for the Congressional Budget Office to determine how much the bill will cost. The nonpartisan agency said in a partial and preliminary analysis today that the plan would run to more than $1 trillion over 10 years and reduce the number of uninsured by roughly 37 million. The agency said that by 2019 some 17 million people -- about half of them illegal immigrants -- would lack coverage.

Eventually, the House and Senate must craft a compromise measure, and conservative lawmakers in both chambers have balked at taxes outside the health-care system.

Senator Ben Nelson, a Nebraska Democrat, said he’s “not hearing a lot” of support for a surtax on wealthy Americans. People in his state don’t like the millionaire’s tax “because they are looking someday to get there themselves,” Nelson told reporters on July 13. “It’s the American way.”

Republicans also voiced their disapproval.

“The Democrats’ priorities for health-care reform are now clear: a government-run system financed on the backs of Americans and small businesses with higher taxes,” said Michael Steele, chairman of the Republican National Committee.

Leaning on Lawmakers

Stumbles in the effort to reduce health-care costs and expand coverage prompted Obama to summon top lawmakers to the White House on July 13 to prod them toward action. The Senate has so far failed to reach a bipartisan compromise, and top advisers to Obama are discussing the possibility of relying only on Democrats to ram the legislation through Congress.

“Ultimately, this is not about a process,” said David Axelrod, Obama’s senior political strategist, in an interview yesterday. “It’s about results.”

To contact the reporters on this story: Ryan Donmoyer in Washington at rdonmoyer@bloomberg.net; Kristin Jensen in Washington at kjensen@bloomberg.net


...Read more

Tuesday, July 14, 2009

More GS BS (F-Goldman Sachs)

YOU SHOULD BE ENRAGED!





Goldman Sachs - this is the straight truth

just buy Goldman because they are the market and it just makes me mad, apparently not just me - watch Gaspi get the hook at the end of this. read more for link


http://zerohedge.blogspot.com/2009/07/gasparino-tells-cnbc-to-stop-protecting.html
...Read more

Meltdown 101: How did $1 trillion deficit happen?

click read more if you would like to read the AP article


WASHINGTON (AP) — In a year of eye-popping numbers, add one more: The government's annual budget deficit has topped $1 trillion.

And with three months left in the budget year, it will actually get even worse. The administration is projecting that the deficit will hit $1.84 trillion for the current budget year, four times the size of last year's deficit. Last year's number was the all-time leader at the time, at $454.8 billion — a figure that now seems rather puny in comparison.

Here are some questions and answers about what happened to the federal budget, which began the new century with the longest string of surpluses in seven decades.

Q: Just how did we go from a string of four consecutive surpluses from 1998 through 2001 to the fix we are in now?

A: The surpluses at the end of the last decade reflected a boom-time economy, which was enjoying the longest uninterrupted expansion in U.S. history.

When the last recession began in 2001, that cut into revenues. Then the government's budget picture darkened even further after the 2001 terrorist attacks as government spending was increased to pay for wars in Afghanistan and Iraq.

Q: But weren't things getting better at the end of the Bush administration?

A: Until President George W. Bush's last year in office, the deficit had been shrinking, hitting a five-year low of $161.5 billion in 2007. But that was followed by the record deficit of $454.8 billion in 2008, the budget year that ended on Sept. 30 of last year.

Two things happened to make the deficit balloon: The country was hit by a severe recession that began in December 2007, and then those troubles were compounded by the worst financial crisis in seven decades, which struck in the fall of 2008.

Q: Isn't it unusual for the budget deficit to deteriorate so much in such a short time?

A: The size of the deficits this time around are unusual, but that reflects the unprecedented response the government has brought to bear to deal with the economic crisis. First, in 2008, Congress created a $700 billion financial rescue fund that had been requested by the Bush administration, and then early this year Congress approved President Barack Obama's request for a $787 billion economic stimulus bill to jump-start growth.

Q: Is that all that is going on with the deficit?

A: Unfortunately, no. Government spending is being driven higher not only by the financial bailouts and the stimulus spending but also by what economists call "automatic stabilizers." That is spending that automatically occurs in times of economic troubles to help cushion the shock of a downturn.

The government is spending billions of dollars more on these expenditures — such things as food stamps and unemployment compensation for the millions of workers who have lost their jobs.

In all, government outlays are up 20.5 percent through the first nine months of this budget year compared to the same period a year ago.

Q: Does that explain all the red ink?

A: No. There is one more factor at work: Government revenues have fallen by 17.9 percent in the October-to-June period compared with a year ago. That reflects the severity of the current recession, which is one of the deepest in decades and the longest downturn in the post-World War II period. That has meant millions of people losing their jobs — and thus not paying payroll taxes into the government's coffers — and a big drop in corporate tax collections as well.

Q: How does this year's projected deficit rank with other periods in history?

A: Without a doubt, the deficit will be the largest in dollar terms, but it won't be a record in relationship to the overall economy — the comparison preferred by economists.

The Congressional Budget Office is forecasting that the budget deficit for this year, using the administration's spending assumptions, will equal 13 percent of the total economy, as measured by the gross domestic product — a measure of the value of all goods and services produced in the United States.

While that would surpass the record of recent years — 6 percent of GDP, achieved in 1983, during the Reagan administration — it is far below the 1943 deficit, which was 30.3 percent of GDP. That deficit reflected the massive spending underetaken to fight World War II.

Q: What is the deficit outlook going forward?

A: That is where the real problems may come. Economists say it is OK to run massive deficits now to stabilize the banking system and get the economy growing again. But they are fearful that the administration and Congress will not do enough to get future deficits under control, despite Obama's pledge to cut the deficit in half by the end of his first term in office.

Q: Why do they question Obama's pledge?

A: The CBO is projecting that the deficits will remain huge for years to come under the administration's budget outline, coming in at $1.43 trillion next year and never dropping below $633 billion over the next decade. All the red ink, the CBO projects, will add $9.1 trillion to the national debt during that period.

Q: What do private economists forecast?

A: They have equally grim forecasts and they warn that these projections underscore the need for the administration to get more serious about attacking future deficits once the current economic crisis is past. They argue that the only way that can be done is through some combination of spending cuts, especially in the government's big entitlement programs, and tax increases.

They say that a good litmus test of the administration's resolve is likely to come in the upcoming battle to expand health care coverage. They believe that proposal will have to be paid for through some type of tax increases to convince foreign investors that the administration is serious about getting its deficits under control.

...Read more

Will GS run the shorts early today only to drop later

in the day...



Goldman Sachs executives sold $700 mln of stock - FT

FT reports executives at GS sold almost $700 mln worth of stock following the collapse of Lehman Brothers last September, according to filings with the SEC. Most of the sales occurred during the period in which the investment bank enjoyed the support of $10 bln from the troubled asset relief program. The surge in selling among Goldman partners, at a time when the US government had thrown a lifeline to Wall Street, is likely to draw criticism from lawmakers on Capitol Hill. For the eight-month period for which figures are available, Goldman partners sold more than $691 mln in company stock, even as the co expanded its public float from 395 mln to 503 mln shares in several capital raises. For the comparable period between September 2007 and April 2008, when the average share price was substantially higher, Goldman partners sold about $438 mln in stock. A spokesman declined to comment on the sales, other than to note that Goldman partners receive a big share of annual bonuses in stock, and that for many, stock sales are an effort to diversify their holdings. Some of the sales could have been motivated by margin calls, which are said to have afflicted a number of Goldman executives who used company stock as collateral for loans.

makes you wonder




Saturday, July 11, 2009

Not much hype for this dude - but not sure why - James Morrison

I think this is really good stuff. Listen and let me know if you agree. For those new to the blog we mix trading talk with a little bit of my music picks here.

Read mo' for the video...



...Read more

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Please do your own research or consult an advisor before making any investments.