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Young Guns

By

What, me worry?

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Love lost, such a cost
Give me things that don't get lost
Like a coin that won't get tossed
Rolling home to you

(Neil Young)


After much anticipation and countless speculation, the conflict with Iraq has officially begun. The implications for the human condition are far reaching--but perhaps that's a topic best left for another time. We've got more pressing issues on our financial plate and, while we're ALL feeling the sobering reality of war, we must carry on and be strong. Just remember--you're a Minyan!

While the epicenter of our focus is obviously the situation overseas, we must continue to monitor the peripheral developments in the marketplace. This morning, Cowen upped the semicaps, UBS Warburg downgraded SANM, Bear trimmed numbers GM, Solly did the same in DIS, Lehman upgraded RD, CS First Boston upped ROST and punted DNA and Morgan raised FDX.

Watch the financials closely today. JP Morgan was notified of possible disciplinary action and, while I'm unsure if this "matters," I wanted to point it out. More importantly, Morgan, Lehman and Goldman all reported "better" numbers this morning and the action in the brokers should be the tell du jour. I've traded this group since my "salad fetching" days at Morgan Stanley and can tell you, first hand, that they're tricky traders. Often times, a run-up into "good" numbers is met with supply and a sell-off into "bad" results spurs rallies. Stay on your toes.

There's a fair amount of chatter out there regarding the effects of expiration on this latest move. As the story goes, dealers were short sizable call options in the indices and after the initial spark, the negative gamma kicked in and ignited the feeding frenzy. It wouldn't shock me--we discussed the huge upside bets being made during the last few weeks which, at the time, I viewed as "hopeful."

So, does that mean that once the expiration passes we'll see a sizable move? Maybe--but, once again, we must appreciate the performance anxiety in place and the looming quarter end. That means one of two things (or, potentially both). The funds are gonna buy dips and attempt to "make themselves right" OR the street is loaded with fresh inventory--and IF we turn appreciably lower, that will simply add more supply to the equation.

One step at a time, friends--this clearly hasn't been the easiest of times and nerves are admittedly a bit frayed. I will offer that adversity may not build character but how you respond to it does. In the immortal words of Lou Mannheim, "Man looks in the abyss, there's nothing staring back at him. At that moment, man finds his character. And that is what keeps him out of the abyss." That's sage advice, screwy Louie!

In Minyanville news, I want to make two quick announcements. Out of respect for the current geopolitical developments and with the understanding that we've all got a lot on our minds, we've decided to postpone the Oscar Charity raffle this weekend. When the dust settles a bit, we'll readdress the razzle dazzle raffle. Instead, Casey, Tony and I are gonna put together some Minyanville care packages and send them to our brave soldiers overseas.

Finally, and this is quite exciting, I'll be making a HUGE announcement tomorrow regarding the Minyanville family that you won't want to miss. We've been careful to take our journey one step at a time and we'll stride right with tomorrow's additions.

Kick some tail, Minyans, and remember to think positive.

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