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Random Thoughts


Everything seems so... I don't know... totally random.

  • Attention Ojai Shoppers--The 2005 Minyans in the Mountains financial seminar is officially SOLD OUT! We appreciate the eye-popping response to our Sundance of Finance and will strive to make ye faithful proud.

  • Why don't you call me sometime when you have no class?

  • Mini-Minyan Succo Mailbag: If Fannie Mae (FNM) needs 1,500 additional consultants and another year to make heads or tails out of its own books, why does Fidelity, Capital Management & Citigroup think they can understand the books better? Why is it trading at a premium to Freddie Mac? Thanks, Minyan TM.

    MTM-The two largest holders, Capital Research and Citigroup, have each bought 8 and 10 million shares over the last period. Collectively these two "funds" now own 20% of the company. You will have to ask them. (John has a position in fnm and c).

  • The Sammy Squat?

  • "S's over N's" continues to be the dominating theme as tech is being held up by the old school. The brokers, trannies, cyclicals, metals and small caps are all chippin' in, so to speak, while the flies in the ointment (Cisco, Fannie, Google) continue to buzz. And yes, market internals are Dentyne fresh as we ready to step to the top of the hump.

  • You got to have a J-O-B if you wanna be with me.

  • The weekly Investor's Intelligence survey shows an increase in the percentage of Bulls to 59.1% from 57.3% prior and a decrease in Bears to 19.3% vs 22.5% prior.

  • "The modest correction last week made bears more aggressive, with sentiment in the Rydex data improving. Energy weightings are now approaching the levels seen in March of this year and September of last, both points coinciding with interim corrections. We would also note that our ETF data base shows energy ETF trading volume accounting for 80% of the total value traded among listed ETFs. These figures are all different ways of saying that energy in our view is over-extended and likely to consolidate." -- Lehman's aptly named technician Jeff DeGraaf

  • Chinese food for thought.

  • Sharin' the Buzz...

    Eye Candy (10:09 AM)

    I see the very snazzy breadth and you know how much stock I put in this input as an intraday indicator. With that said, and as we rapidly approach BKX 100 (the 50-day, 200-day and the downtrend line from the July highs), I'm gonna slip an arm into my metaphorical bear costume--makes 75% conviction on the short side--and keep close tabs on the frisky financials.

    Again, if Boo has a bit of latitude and patience, I think S&P 1250 is a much more important level (S&P 1255 seems like an intuitive stop). If he wants to keep his risk more defined, he can use the other side of our piggy poke.

  • I'll take a muscle bound man and put his face in the sand...

  • I'm sorry honey. I'm sorry honey.

  • Mini-Minyan Succo Mailbag: John, as a member of the financial industry, I'm just amazed at the strength in the XBD. Considering the overcapacity, the compression of margins, and the increased costs of acquiring customers, I can't see for the life of me why this index is screaming to all time highs. What gives?Regards, Minyan Dave.

    MD-There is still massive liquidity out there and from what we can see, the Japanese are now being even more aggressive than we are. With that assumption, it is easy to understand the irresistible urge of funds to put whatever cash they get in into these stocks because they already own them and want them higher. They justify this with low relative P/E ratios. But as you point out, with a flat yield curve and margin pressures, it is difficult for broker dealers to make any money. The main way they are doing it is taking more risk in trading securities, mainly by being long financial assets. So it continues to be a Ponzi in a sense: everyone is dependent on higher stock and bond pricesYes, the economy is growing, but why? Because real estate speculation is driving growth. Why? Because long term interest rates continue to remain low. Why? Because liquidity is high and investors of all types are still buying financial assets. With what? Liquidity that is being created by more and more debt.

  • What Marbles!

  • The two biggest concerns for young Boo right now? The breadth, natch, and the crossing stochastics in the BKX. If the financials start playing ketchup, our bear better watch his back.

  • No sushi for you!

  • The squeeze is on in more ways than one as we ready to pack up the critter caravan and head west (young man). There are alotta moving parts to this puppy and I think it's safe to say that MVHQ is long work and short sleep in size. Deep breath, team Minyan, the purpose of the journey is the journey itself. That's more than a catch's a way of life.

  • Fare ye well on the other side of thy Hump.

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