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Waiting for the Ba-Bing


"Just let me know when you hear that 'Baaahhh'... I'll be over here, getting pummeled..."


No, it doesn't feel like the selling is over yet to me, either.

I've got my cash well and truly hoarded, ready to put to work. I don't really care if it's long or short, I can do either, I just want to put it to work. The aftermath of closing my fund, both logistical and in terms of mind-share, have resulted in too much cash sitting idle, earning bupkiss and feeling unloved.

I'm all but frothing at the mouth wanting to put it to work in names old and new. So what am I waiting for?

I'm waiting for the Ba-Bing. I want a hideous morning with rock-bottom futures and no end in site. I want General Motors (GM) to miss by 900 miles tomorrow morning then I want Wagoner to channel Notre Dame era Lou Holtz on the conference call.

"We're simply not a good automotive company" I want Wagoner to say, adopting both the general football coach manner or specifying the exact game being played and, if we're really going to bottom, maybe even a bit of Holtz' unique lisp. "I look at the line-ups we got and the automotive program over there at Toyota (TM) and, I'll tell you what, we'll be lucky to lose less than 500 bips of share this year."

Kill any optimism. Sneak up on optimism in a dark alley and pistol-whip it. Give us a cleansing flush of fear. Smash the small-caps as mutual funds bail. Take away all the hiding spots on the long side and make it ugly.

Break support in the mid-caps and get people noting the nice support around the 1085 area in the SPX.

I want to clean up my remaining shorts but I think I can do it lower. I think it's too late to add shorts. I think we've been in something of a huge range for the last 5 years. We're closer to the bottom of that range than the top and the news flow has been horrendous for a few weeks. That's how these things work. Terrible news, weak stocks... repeat until the concerns are "in the market".

I don't think it's too "Cute" to wait because I think SOON-ish type of sell-offs end with a smashing. They end when all hope has been abandoned. Oversold or not, I still think there's hope.

I think the better trade is long but it comes from lower levels. I think it's worth waiting for that entry point, or at least that's what my process is telling me. It's been wrong in the past and I expect that it will be again in the future. But it's mine, for better and worse, and for whatever it may be worth, it's saying "wait".

I want the Baaaaaaah of despair to complete the work of washing us out... If this sell-off works as recent history suggests, a Bing rally will follow shortly thereafter.

Idle Thumps

  • DirecTV (DTV) continues to skid along near 52-week lows. I'm not interested in them on either side but I can offer that I disagree with many of the points made here, in Barron's. The broadcast guys are facing a period of earth-shaking change. A massive ad repricing looms and the low-hanging fruit on getting customers seems gone. This change has been looming for years but I still like select interactive TV guys, TiVO and OPTV among them. The MSO's or satellites are much less interesting to me.
  • Summer has arrived, belatedly, to the Bay Area, causing my annual golf obsession. "Burn all instruction manuals that aren't Ben Hogan's 5-Lessons and Harvey Pennick's Little Red Book"; that's my latest Answer to End All Answers. I'll let y'all know if I get meaningfully closer to scaring par this year.
  • Congrats to Collins and Baltimore... the best darn pharmacists in the land, though there are plenty of hormone cycles left in the season.

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Position in TIVO, OPTV

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