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Buzz Bits: Dow and Nasdaq End Mixed


Your daily Buzz & Banter highlights.


Editor's Note: This is a small sample of the content available on the Buzz & Banter.

Do you mind if I go to the bathroom? (Pause) Thank you! - Todd Harrison - 3:34 PM

  • So, you want the good news or the bad news? The good news, for moi, is that my eyes still work. Baidu (BIDU) is up a finski, Apple (AAPL) is galloping. Heck, even Mother Morgan (MS) took a peek across the Matador City fence. Nice times three.

  • The less thrilling thought is that I'm not participating in the gains. After fighting the good fight and investing the stress, I departed the positions on the first head-fake below S&P 1310 (against my better judgment). I didn't lose money but I didn't make it either, a twisted tale for sure.

  • Wait, didn't I say there weren't corks on my forks? Hey, I'm human--lemme vent!

  • Back in reality, the bond bailout chatter is again getting loud. Reason for the rhyme? Perhaps, there were some pressers on the lows and they've turned tail. That, and the forward looking "successful retest" thought has spurred the herd.

  • Random Thought: What happens if they announce the bailout and the tape can't rally? Haven't heard that one yet, outside of Minyan MM who just passed it along.

  • Nobody puts Bonnie in a corner.

  • What's the "know thyself" rule? When you're trading well and not making money, take a step back?

  • Jeezums, talk about a reality show. It's like Survivor meets American Idolatry.

  • If you missed the opening reference, I'm gonna throw you a bone. It's too good to miss.

  • OK, enough rambles. My 3pm meld calls and, to be honest, I'm tired of looking and flickering, bickering ticks. Fare ye well into the bell Yo.


Make It, Take It and Rake It - Ryan Krueger - 1:49 PM

I dragged my breaking-through-support old bones to play hoops with a few boys who handle more energy option trades than any shop I know of last night. The business of trading is better than good, especially if you're the house. Good ol' fashioned commission business on derivatives is alive and well. Unfortunately their company (and plane) is private, but they offer a clue to the strength in FC Stone (FCSX) and GFI Group (GFIG). Brokering derivatives has not been replaced by electronic trading like Intercontinental Exchange (ICE) which I also plan on being long again, but am not currently.

I've added MF Global (MF) to my bullpen as a candidate for the "Rake" trade I've written about often. I want to be long the little black boxes on the side of the table collecting Vig from big black box trading systems.

The well publicized rogue trader who may have incidentally offered his own clue about a possible top in Wheat (?) crushed the otherwise very well run firm's stock last week. The company clears for some the world's largest commodity hedge funds and from what I am told do it exceptionally well, although we do not use them, for full disclosure.

As for the risk that is being taken out there, I suspect it is always exponentially more than we read about. Don't forget what they call all the other rogue traders who find loopholes in risk management systems that are on the other side of those high profile headlines – partners.

Positions in FCSX, GFIG.

Help me I am melting!!! - Bennet Sedecca - 1:34 PM

What am I ? Not the Wicked Witch of the West. And certainly not Toto. I am referring to the ABX market, which is in full implosion mode.

Many indices down another 10% today. Sellers beget sellers begets more selling. So we have gone from denial to fear to capitulation.

And oh by the way, according to Fed Funds futures, the market is pricing in a 85% chance of a 75 basis point cut at the next FOMC meeting.

Does the credit market care? Nope. Wells Fargo (WFC) is doing a preferred deal at 8%.

My firm remains short credit via WFC, JP Morgan (JPM), Lehman (LEH), Goldman (GS), Bear Stearns (BSC) preferred.

More on LEH later...

Position in JPM, WFC, LEH, GS, BSC preferreds

In Like a Lion? - Jeff Macke - 12:33 PM

Hello from New York where it's 63 and muddy; suggesting March skipped the "in like a Lion" part and went straight to the Lamb. I'm cool with that. Here's what else I'm passing pointless judgments on as the tape trips lower:

  • Intel (INTC) is an Ink Spot (or Rorschach) test. A happy, well-adjusted tape would have regarded it as a reasonable adjustment for a company earning greater than 50% margins. This tape regards it as a chilling portent of doom. The truth, as always, lurks somewhere in the middle.

  • The same Spotty reaction could be assigned to Citi (C). I've got two bits of news for those who have been sleeping since last summer. 1) You missed an amazing Super Bowl. 2) The banks have problems and Citi might be the worst of 'em.

  • In fairness, the Super Bowl was more of a surprise than Citi, for those who have been paying attention to sports or business.

  • Guy "Gee" Adami's MasterCard (MA) inspires quite a bit of emotion, judging by the questions we took after Friday's show. Guy's been dead-right on this one while the bears get carried out. My two cents: MA will CRUSH with a good consumer (which we don't have); it'll simply be an outrageously great franchise with a bad consumer. The Visa IPO may dent the multiple but I'd be a buyer of a sustained MA dip.

  • Google (GOOG) is simply a widow-maker at this point. Just killing people clinging to the name because they (in no particular order): want to avoid cap gains taxes; think GOOG is a value play; "have been through dips before and the stock always comes back". No more predictions on the stock here and I'm actually a fan of the company, as a business. But I wouldn't touch the stock here, long or short, for what it's worth.


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No positions in stocks mentioned.

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