Thursday, August 28, 2008

Hey, Maybe I'm Wrong

I'm the biggest financial bear on the planet as you all know. Najarian is talking about the off the charts call option action in the financials today, and I do have to "respect" bullish action in any group when it presents itself. Odd day, and I don't trust moves up or down with such low volume. I've seen the movie before, so have you. Could today have been a sneaky day where "smart" money came in and staked their claim on the financials? Maybe, and time will tell, but I think the positive action in the financials this week was more a result of a lack of a catastrophe, than any good news, although Fannie and Freddie not going to zero did help confidence. Supposedly, Goldman is going to report their worse quarter in 25 years, a contrarian may look at this as a sign of an absolute bottom for the group, others can look at it as sign that the mightiest have fallen and it will only get worse.

I hoping for a "miss" with Gustav because money will be printed on the short side if that happens. I'm hoping for a miss so people don't get their lives turned upside down by the way, I'm neither long or short here and have no ax to grind. I am a human being first after all. But if the hurricane does head east, these pups are going to implode. I'm talking gas more than oil by the way, although I think both go lower. Maybe the gas shorts have some Doppler radar that the weatherman doesn't have, but today's action spoke volumes to me.

The dollar looks higher and that will bode poorly for the commodity sector. These fertilizer stocks are starting to look like they are on life support. More huge money to be made there on the short side in my opinion. POT, MOS, AGU are my all time favorites there.

Tonight Bon Jovi--I mean Obama is playing live at Mile High Stadium. I just got 10k for my seats in the blues on Stub Hub. The reason I mention this, is because the bloom will come off the rose there in a couple of days and then it's McCains's turn at bat. I'm not giving a political opinion here but the market watches this more than we think.The economy is in the craphouse and I think unless you are a college student or a homeless person, you are looking for lower taxes, and Wall street cares about that, just like they care about higher taxes squeezing them in tough economic times.

The home stretch is coming up, and preservation of capital is job one. Let's not get silly and let's remember the end game, to end up with more, not less. I remember years ago being on the Lexington Avenue line heading downtown to Wall Street from the upper east side and running onto Ralph Acampora, some of you, if you are over 35 may know who he is. He spent many years as a guest and panelist on Louis Rukeysers Wall St. Week, he was also a guy that I spoke to on the phone many times chatting about the market and technicals on stocks. Ralph is a great guy and has a longer term view when he looks at charts, I'm sure he killed em in his own trading account short term, but to clients he was more long haul. I will never forget the conversation, but the takeaway was that he was bullish. He said that we were in a "gilded age" and that here was no end in sight to the upside. That conversation was in the very beginning of 2000. He probably forgot, I never did. Hey, just a conversation, we all took the bait. It's always in the back of my head though, why not this time?


About Me

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I am a former hedge fund manager, broker and capital markets dude who now trades for his own account. I love what I do. I will try to post some stocks and an occasional chart that looks attractive for entry.I will also try to point out the idiocy of conventional wisdom and the lack of value added by the mainstream financial media. These postings should not be viewed as recommendations.