Archive for April, 2008

Better Late than Never

Sorry I’m posting a little late. I had the TV repairman come to my home (yes, I have a TV repairman) and finally fix my TV which I’ve lived two weeks without.

There’s only so much Hero’s I can watch on Netflix before I desire something else.

Let me not forget to mention that yesterday I came back from moving my nephew a few hours away. God, what a chore that was.

My body is STILL so from all that lifting and moving. But thank god, I’m finally home.

So what’s been going on with the market? It’s been acting stupid, that’s what.

We get a bunch of bad news on banks today. Yet somehow the markets rise.

I think it might have something to do with the retail sales report, which excluding gas was pretty much flat. I guess people were expecting a decline.

I don’t know about you, but no change in retail sales sounds like a bad thing.

But hey, who am I to complain? I saw the drop I was looking for last week. I can wait a few days for another drop to let me get out of our DIA puts at a decent profit.

With that said, I’m seriously paying attention to upside risks from here on out. We’ve been in this recession for a few months. News isn’t coming out quite as bad as people are expecting. It’s making me think that upside risks are more pronounced.

I know, I sound like a Federal Reserve talking head. But seriously, it’s true. These are the risks we have to deal with right now.

So wait until this down move is finished and then look for a good upside play to make money on the upswing (if it happens).

I’ll be back later.

I Love Being Right

A couple weeks ago I talked about how the Dow Jones wouldn’t pass 12,800.

But after I wrote that, the Dow moved higher. It freaked me out but I stayed calm, even telling others not to be pansy’s and to stick with their decisions.

Well, the Dow got about 40-50 points under that level. And today it ended at 12,325. That’s great, because just a few days ago I talked about how nice it would be to see the Dow end the week under 12,400.

Damn I love being right.

And to think, the Dow could keep dropping another 900 points by the time all is said and done. This would make my DIA puts nice and profitable.

I guess investors are finally realizing that anything that affects how banks loan, will affect every industry out there.

Let’s face it. Banks lend money to companies so they can grow. If banks can lend to companies, then the companies will have a hard time growing.

It’s simply logic really. And it’s the reason why GE had poor earnings today. It’s also the reason why Dole and the Tribune company may end up bankrupt in the next two years.

Well, I guess we’ll see how the market digests all of this over the weekend. If we can start off Monday with a disappointing earnings report or perhaps news of China jacking up their currency by 50%, then I’m sure we’ll be looking at a sharply lower Dow for the week.

Everyone have a fantastic weekend. I’m going to be a good uncle and spend Saturday helping my nephew (who is older than me) move his two story three bedroom home two hours away to the west coast of Florida.

Fun, I know. So I hope your weekend is far better.

Take care!

Poor Caveman

I have to admit, I think bulls are feeling like the caveman in this video.

Oh, and this is my FAVORITE Geico commercial in the world. And that’s saying allot, because I love the Australian gecko.

Freaking McDonalds

Here’s something I have to admit. And I kinda feel bad doing it…

I prefer McDonald’s iced coffee over Dunking Donuts iced coffee. No, I’m not a swanky Starbucks type (I even call them Starsucks). I’m just a regular guy who happens to make damn good market calls.

So why do I prefer McDonald’s? I think it’s the hazelnut flavoring. It’s freaking delicious. The DD flavoring just tastes bitter.

So needless to say, I’ve been going to McDonald’s more often lately. So last night me and my girlfriend went to McDonald’s in search for some Cinnamon treats. And we also ordered a chicken burger. So my girlfriend asks for some barbecue sauce, and the stupid manager guy looks at us and says ‘11 cents per sauce packet’.

Really?!?!?!?!

First of all, why 11 cents? Did you want to bring the penny back? Why not 10 or 15 cents. You know, a nice round number. Instead, if I don’t have exactly 11 cents, I have to get 4 pennies back from you.

I hate pennies! If they are double stamped, then OK, I’ll take them. But until then, what the hell!

The second frustrating thing about this, if I buy anything at McDonald’s I should have the privilege of being able to choose what condiment I want. I shouldn’t have to order a ’special’ meal just to have the ‘right’ to have barbecue on my chicken burger.

What, should I sign some forms to make sure I’m eligible for ketchup?

God, McDonald’s does some crazy things sometimes. But I have to say that at least the market is looking down today.

We had an airliner go bankrupt. GE screwed the earnings pooch. And import inflation soared 2.8% last month (what is that like a 10% rise in the past year?!?).

Yeah, as you can expect, market isn’t too happy about that. Maybe we’ll have a nice 200-point drop today to celebrate.

I’ll be back later!

Now that the days almost over…

I have to say, I’m comforted to see the Dow up only like 30 points. Especially since it was up over 100 at one point today.

All of these rallies that stop being rallies make me think the Dow will head lower in the next few weeks. What will add pressure for a lower next week is the fact that we have a bunch of financial companies releasing earnings.

Yeah, that should hurt.

And did anyone else think this whole ‘Citibank sells of $12 billion in bonds’ really silly?

Here’s the deal: Citibank actually helped fund the private equity group who bought the bonds. In fact, the only reason they could buy it was because of Citibank’s loan!

So in essence, Citibank removed these crap bonds from their books so that they wouldn’t have to keep writing them down. Meanwhile, they issued a new loan to the private equity group because they wouldn’t have to worry about writing that loan down.

But, should this private equity group default because of these bad loans, Citibank is on the hook for it.

And here’s another crazy thing about this deal…

Citibank said they sold those bonds at 90 cents to the dollar. Apparently, they tried to signal to the market that this credit crunch is close to over because someone bought it for more than 70 cents on the dollar (which was the going rate).

Here’s the kicker… Citibank guaranteed taking care of the first 20% in losses this group might have because of these bonds. In other words, this group effectively bought these bonds for 70 cents on the dollar!

And they bought it with Citibank’s own freaking money!!!!!!!!!!!

You know, maybe I should sell my dad my car. But before I do, let me loan him the money it takes to buy the car and then guarantee all repairs for the first 20,000 miles.

But who cares, I sold the car!

Yeah, this is the kinda idiot crap that Citibank is doing right now.

Good going geniuses.

So far, it’s been a fantastic day

It looks like the Dow is buckling under the pressure…

Recessions… a housing mess… credit crunches… and now less than stellar earnings.

A good reason why the Dow is down about 80 points so far. Hopefully it can end the day down 150 points and I can make some good money on my DIA put.

I’d love to see the Dow end the week under 12,400. Then hopefully next week we could see it move down to 12,000. That would be AMAZINGLY GREAT.

The best part is, as the market drops, Ag stocks continue to tick higher. Now, granted they have a lot of ground to make up for. But if they can manage to keep moving higher this week, I’ll feel far more confident about this part of the market.

Oh, and has anyone seen how great Gamestop (GME) has been doing lately? They are in a recession resistant sector and taking advantage of the video game bull run nobody (but me) has been talking about. They are a great buy, that’s for sure. Although, I’d love to see them test their 200-day in the next couple days before I jump in.

In the end, it looks like the market is starting to behave and act more rationally. Although, I wouldn’t be shocked to see some craziness in the next few days.

Alright, I’m out of here for now.

Mmmm, Oranges

As I peel away at this delicious, Florida orange (before I go work out), I can’t help but smirk as I think about how the market closed today.

Will tomorrow finally deliver the bear attack we’ve all been waiting for?

I sure hope so.

And to help us get there will be earnings announcements from Circuit City (who is damn near close to going bankrupt), Price smart, and Progressive.

I’ll admit. None of these companies have enough pull to make the markets tank horridly tomorrow. But bad news never hurts.

And the only economic report coming out tomorrow is the inventory report.

If inventories build, that means manufacturing slows (since they don’t have to manufacture as much). And if manufacturing is slowing, so is the economy. So look for an inventory build as a bad thing.

Regardless, it looks like tomorrows market will be left to its own devices. Earnings and government reports shouldn’t have too much of an effect.

Although, I do wish a nasty little rumor would hit the market causing a panic sell-off that shuts down the indexes. Of course, if all of this could happen while Ag stocks soar 20%, that would be optimal!

Hell, if anyone could just give Ben a nationally televised punch to the face, that would suffice.

With that said, everyone have a great night!

Just too good to pass up

In case everyone hasn’t been paying attention to the democratic elections, I just recently hear something that made me reaffirm how much of a crazy psychopathic liar Hillary Clinton really is.

Not only did she lie about getting shot at (and later claimed she said it due to lack of sleep. HAH) But now she was found using a story in her stump speech that simply wasn’t true.

It was about a woman (who makes minimum wage) who was in labor, but didn’t have insurance, so the hospital didn’t take her in and the baby died. Later, they fly her to another hospital and she ended up dying. Moral of the story? Universal healthcare.

Good story – too bad it’s not true.

Accrding to CNN, the hospital who took care of the woman said that they took care of her, and she had insurance!

So now Hillary’s speeches have taken out that little story. I have to wonder though, how many other stories are just like this one? And why doesn’t she confirm the stories before she gives speeces about them all over the country?

Ahh, trully logical questions to ask an illogical mind.

A Sexy Looking Open

With the recent volatility, it’s hard to say if the market will stay down. But that’s where the futures are.

And trading overseas also suffered.

All of this points to me having a potentially fantastic day. But i’m going to hold off all judgement until the market closes.

After all, Marketwatch just reported that Washington Mutual lined up $7 billion in loans. And that’s sure to make their $1.1 billion Q1 loss seem like nothing (at least to the illogical investors).

Let’s hope that the market acts rationally today and actually moves back down. There’s nothing out there that could fuel a market rally. And in my opinion, a recession hasn’t even been fully priced in yet.

So let’s get efficient, stupid markets! And price in the very big and real risk of recession!

Or else i’m going to make fistfulls of cash as you adjust.

On second thought, market, take some time to adjust!

Laughing in the Face of the Bulls

So today I thought for sure that the market would continue along its well-beaten illogical path.

The Dow was up over 100 points at one time. And then ten minutes before the close, the Dow was fighting just to stay in the green!

It was amazing – like watching Hitler get punched in the face by Adam Corolla.

The Dow is showing some weakness up by the 12,800 resistance. MWahahahahhaha!

And then in after hours came news that Alcoa disappointed analysts and profits dropped by about 50%. Then AMD announced job layoffs. And then, to make matters worse, there was news that Dole foods and the Tribune Company were going to have to tap their revolving credit just to pay back the bonds due in the next two years.

In fact, even with this $2 billion account, they still won’t have enough money to pay the bonds back. Not only is this bad for Dole and the Tribune Company, but also the banks!

Think about it. How many other companies are going to be in this same situation in the next year or two? A lot of them – especially if the economy continues to slow down.

As these companies get in ugly situations, the banks are going to be pulling their hair out. Now, they’re going to have to worry about all the loans they made to these companies. And if these companies go bankrupt, then the bank is screwed out of their money.

And this comes at a time when banks are struggling to keep their reserve requirements in tact as they write off billions.

Not looking to good for the open tomorrow, that’s for sure.