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It's a Walk-Off!

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...losses are part of the process and we've never been the kind to sweep 'em under the rug.

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"So I'm repelling down Mount Vesuvius when suddenly I slip, and I start to fall. Just falling, ahh ahh, I'll never forget the terror. When suddenly I realize "Holy schvitz, Hansel, haven't you been smoking Peyote for six straight days, and couldn't some of this maybe be in your head?"

--Hansel (he's so hot right now), Zoolander


Good morning and welcome back to the acne shack. Another day, another record and the Matador Crowd is now out in force. You can't blame them for being brazen as the "hands over eyes" spies are strong and stronger. Breadth? Better than two-to-one of late, as cautious optimism has turned to widespread participation. Leadership? The widely-watched and uber-important piggies have pimples on their puss as the banks broke-out through BKX 114. Top line technicals? S&P 1240 is now underfoot and, as past resistance is future support, that now becomes a level to lean on Hoofy & Co.

I was reading the Journal this morning as I walked to work and, once again, I stopped to ponder the headlines:

"Bernanke suggested the sinking housing market could damp growth. The Dow Jones industrials rose 123.27 to 11850.61 on the remarks, which were seen as a sign the next Fed move will be to cut rates. Bonds also rallied."

While I "get" that reaction to news is more important to the news itself, I couldn't help but chuckle. A sinking housing market? In the context of record debt and $2 trillion in adjustable rate mortgages that are due to re-set by the end of next year?

Yesterday, in my morning missive, I chewed through the current dew with an eye on what I've done wrong. I learned long ago that the only difference between mistakes and lessons is the ability to learn from it and, in many ways, that's what the 'Ville is all about. If Minyans can learn from my errors--rather than make them for themselves--we've provided utility and education. Yes, I would much prefer to share a profitable process and many times we do. But losses are part of the process and we've never been the kind to sweep 'em under the rug.

I opined, in that column, that the truth lies in the transition between what was (inflation concerns) and what will be (a global slowdown). Collective perception is a process--a time-consuming process--and the road from inflation (or, stagflation) to deflation is paved with best intentions. Indeed, if the housing bubble and energy prices were considered concerns a few months ago, they've been alleviated by the heretofore pullback. In that vein, I suppose that the only difference between a rally and serious slippage is the distinction between "what" (prices are doing) and "why" (they're doing what they're doing).

There's a lot to chew on--that's for sure--and we'll continue to do so over on the Buzz. Before I go, I'll leave you with a quick spate of cookie crumbs:

  • If you missed Minyan Michael Santoli's assimilation yesterday, please be sure to check it out. It was--and is--precisely what the doctor ordered (balance).

  • I asked the question yesterday whether we saw a short-term commodity capitulation. While I didn't add exposure to my existing bet (despite making some disciplined sales last week), we witnessed a nice snapper shortly thereafter. Indeed, the OSX and XAU found their way towards the top of the sector leader board and I continue to trade around some long gamma positions on that front.

  • Please remember to save the date of December 1st. We're hoping to have the particulars locked by the end of the week so we can open the gates and help the kids. Lotsa sharp finance folks, some early winks from former Knicks and Minyans stopping Minyans, just to shake their hands. Nice.

  • Yankee baseball at 1:00 PM? Just what A.D.D. traders in sensory overload environments need!

  • Hit 'em hard Minyans, and keep it real.


Good luck today.

R.P.

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