GM and Chrysler to Go Bankrupt

Obama has determined that the best way to go is for GM and Chrysler to rollover and do a prepackaged bankruptcy. At least he was thoughtful enough to put it in a package, bow and all. This is 48 hours after he decided to give GM 60 "more" days to avoid the inevitible disaster. I heard they were an Escalade short of solvency. With the government now being in full control, Im sure they will be using Barnet Frank's "ownership" leverage to the fullest extent. Can't wait to drive my rubix cube with wheels on my next long trip.

If you actually purchased GM in a "die and hold" account, it is now a good time to slowly remove the barrel of the revolver from your mouth. Hey there's always Citi to get even.

Pandit May Go

The chatter this morning is that the board at Citigroup is getting "impatient" with Pandit. I guess they will be real "annoyed" when the stock hits $3. This is a true case study about how Wall St. continues to go back to the well of incompetence. Years ago Pandit left Citi, started a really big hedge fund, imploded it, sold it back to Citi and then gets offered the top job back at the bank. Great work if you can get it. I'm not surprised, but it truly is disgraceful in my eyes. Big Vik bought a boatload of C just north of $10 a while back when the pundits called their 50th and "final" bottom. Ouch. So much for following "smart money." I never subscribed to the strategy of watching what insiders are doing. Too many moving parts that include tax maneuvering etc..and frankly insiders know nothing about how the markets work.

A wonderful "tell" that validates and strengthens my constant drone that our banks will need much more capital going forward, is what is going on with HSBC this morning overseas. They "think" they may need another $30 billion. Morgan is out saying "they weren't as well capitalized as they thought", they may now cut their dividend by 50%. Let's face it, banks aren't buys again until dividends are completely "eliminated", not "cut". Please give me a break. How can these entities continue to be so arrogant? Eliminate all dividends I say, and do it now, otherwise they are just prolonging the inevitable and jerking the public around. In the meantime I'm staying short up the wazoo.

Getting Real Hot In Here

Did you hear that? Oh, that was just the sound of me patting myself on the back again. Almost like I had today's paper over the weekend. But I digress. Last nights charts were what it was all about today. STI-2.66 C-.97, UYG-2.15, ZION-5.96, WB-1.70, STT-3.66,BAC-1.52. Today was huge and tomorrow should be even better. I'll be back soon.
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Financial Crash?

These are the names that have been so good to me over the last six months on the short side. If the financials react poorly to this Freddie/ Fannie drama, I will continue to short them, hopefully to drill bits.

Cash Is A Position Too

I am at the point where I really don't know if we crash here, or go up 700 points. As a result of my confusion I am playing light until I can get comfortable with a direction. Oil is off slightly, the dollar is up a bit and futures are flat. Bridgewater reports that bank losses could be four times greater than originally thought and if all of this junk gets marked to market the losses could exceed $1.6 trillion. Another Swiss paper reports that UBS and Credit Suisse may need to raise an additional $68 billion in the form of stock. I personally think banks are in the 7th inning and there is more bad news to come. I am hearing a major bulge bracket will implode soon. Some banks to watch for lower prices are: WB(my calls are taking a dirt nap) KEY,BAC,ZION,C

Citi Never Sleeps?

More ugly. When I look at the IBD 100 this weekend I think it's safe to say about 75% of the great stocks are energy related. No surprise, IBD should have a category of the 100 worst, I don't know why they don't, but if they did, I'm sure it would be 75% financials. Everyone who has tried to call a bottom in financials has been crushed, I think this time they will wait.

Will GOOG and Financials Set The Table?

Google was massive and breathtaking. I bought a teeny bit for kicks and giggles in the after market and made some loot. So much for me thinking those ad clicks were going to be weak. Citi reported and it looks like they did a "kitchen sink" which will strengthen the view by some folks that the worst is over for the financials.

I will be watching oil and ags today. These are the two most powerful groups out there but will hit a wall at some point and that is what I am waiting for. You can't buy them here so I have to wait to short. I can't wait to unleash the hounds of hell on the short side on both of these sectors. Maybe today, maybe not, we'll see. Soon though.

The DJI futures are up about 70 and NAZZ future are up about 18

A Flat Start

There will be about 46 earnings reports today. We were so consumed with the market imploding last quarter we really were not caught up in the earnings reports that much. This quarter should be different as the markets seems to have found its balance. Citigroup is dumping $12 billion in debt off to Blackstone and Apollo Group at a 10% haircut. We are in a recession, the question is, have we or are we in a discounting process. I think we are in discounting/bottoming process here, at least until another shoe drops. Credit cards and auto loans anyone?