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Random Thoughts


Hey, a penny saved is a penny owed.

  • On the heels of yesterday's snazzy European showing, the first move of '07 is running straight through Matador City. Breadth is 2:1 positive, the financials and semis (traditional leaders) are uppity and fresh monthly inflows seem to be, uh, flowing.

  • I'm picking out a thermos for you...and I've picked up some Weatherford (WFT) for me. As discussed earlier on today's Buzz, I nibbled on some defined risk upside calls as it gets smoked for 7%. Sub-$40 has been a profitable picking point for the driller and I don't mind owning some upside exposure with volatilities this cheap.

  • Remember how we discussed how GREAT the metals were trading considering the dollar? Ix-Nay on that Otten Ray. The XAU is now down 3% and trading below the 50- and 200-day moving average. A big level? Yeah, you can say that again.

  • A big level.

  • Speaking of big levels, THIS is the biggest one day jump ever. Hey, a penny saved is a penny owed.

  • Now here comes the marbles, Minyans. IF asset classes are inextricably linked to the dollar (asset class deflation vs. dollar devaluation)--and commodities are off 2.5%--doesn't it stand to reason that equities will soon follow suit? Watch market internals (still 2:1 positive) and financials as THE tells into the afternoon and keep it in mind in the coming sessions.

  • While you're at it, watch that dollar--it's grinding to the best levels of the session (DXY +85 bips). A move through DXY 84.25ish could spell trouble for the other side of that trade.

  • I finally saw The Princess Bride last week, a movie that many Minyans have implored me to score. How did I go so many years without watching that flick? It is, in a word, inconceivable!

  • "Here we go again. See the chart of the Chinese Shanghai Index. Can you say parabolic? These folks got the year off on the right foot. Only up 4% the first day. I guess if they keep it up for 250 straight days, it will only be up 1000% this year." Professor Bennet Sedacca on today's Buzz.

  • I vote for more four day weekends. I mean, honestly, how is one expected to balance when we've got five days of work and two days to rest?

  • O-Dog is in a mood today as the homies get smoked. Among the worst houses in the neighborhood? Toll Brothers (-3%), Lennar (-3%) and KB Homes (-2.8%). I still think the sub-prime lenders are gonna be sub-prime performers.

  • There's some rebalancing in the indices on today's close, which include 2200 S&P contracts for sale ($780 million notional), 650 Mid-Cap contracts to buy ($265 million notional) and 2000 Russell e-mini contracts to buy ($157 million notional). What am I gonna do with that? Nadia. Nothing. Zilch. I've found, after 16 years of watching beams, that these balances are too crowded to game.

  • The Rolling Bones, featuring our very own Minyan Charlie Mangano , will perform tomorrow night at the Red Lion in NYC. This is turning into a snazzy monthly mingle and Minyans are more than welcome to attend.

  • The Mighty Goldman cut AMD, AMAT and CMOS to "sell" and they're nearly flat on the session? Remember Minyans, the reaction to news is more important than the news itself. If the tape reverses, however, look for these names to lead the downside bleed.

  • Yuris remains at large. Slippery, but at large.

  • The last five minutes (and overtime) of the Fiesta Bowl was about as good as it gets in college football. I mean, honestly, the statue of liberty to beat Oklahoma? That's brilliant.

  • Vibes from my good friend, Snoop Tony Dwyer of FTN Midwest Securities:
    • We remain bullish, with a 2007 S&P 500 target of 1,650 (which we think is overly conservative).
    • We favor "all cap" and growth over value.
    • We remain favorable on Info Tech, Consumer Disc. (with a focus on the makers and deliverers of entertainment), Industrials and Financials. We remain unfavorable on Energy, Materials, and to a lesser degree Consumer Staples.


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Position in wft, metals, energy
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