House of Straw
Please take a moment and read Bank One's comments.
We used to play for silver
Now we play for life
One's for sport and one's for blood
At the point of a knife
How could I possibly watch the British Prime Minister on television and NOT quote Jack Straw? I mean, honestly--do you think his parents shook their bones at a point? That's fantastic! I wonder if he's got an uncle named John or a wife named Bertha? Does he have a buddy named Jed who lives in Tennessee? Does he pray to Saint Stephen? Somebody call Casey Jones!
I've been having a town hall meeting in my mind and I wanted to invite you in for a discussion. This is my dilemma: There are two (potentially three) overnight unknowns. Intel will color tomorrow's tech tape, Beeks will have a huge impact on the broader market and everybody's running around saying that Dubya's gonna announce that we've got Bin Laden (at his press conference). If our goal is to identify advantageous risk/reward, can I justify two paws in my bear costume?
The honest answer is--probably not. I hate the way the internals act, the banks scare the sprinkles out of me, I "feel" as if the pennant formations will resolve themselves to the downside and the geopolitical landscape, if anything, is becoming more muddled. However, there is significant gap risk both ways and I've long said that the mechanics of the swing are more important than the results of the at-bat. As such, I'm going to slip that appendage out of my bear costume into the close.
Why am I not doing it now? The breadth, mostly, and the fact that Snapper couldn't get his groove on with any zest. I'm unsure if the Minx will let us "break" in front of Intel and, more importantly, the jobs data--that would almost be too easy and in this market, nothing comes easy. She'll probably let both camps sweat it out overnight and roll the dice if they wanna play. So you know, I have (and will) cover my undefined exposure and my short bias will be limited to defined risk April puts.
This has been an extremely long day already and it's showing no signs of slowing. Still, exhaustion is no excuse for mental errors so I will once again ask you to shake out the cobwebs and remain lucid. If you're cossing toins on your bias, that's a sign to flatten a bit and take a step back. The weeding out process continues to suck out the industry overcapacity and our goal is to find our way to the other side.
Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at email@example.com.
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