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Sitting, Watching, Waiting


I am sitting, watching, waiting and reminding myself that having the patience not to play is better than falling off the tricycle.

These are the times I don't like my job. I'm not getting hurt from a P&L standpoint, but the market is defying virtually all of its pillars: fundamentals, technicals, structural and psychology.

We know the economy is slowing – no debate over that. Technically, there are enough divergences and forks in the road that even Yogi Berra would be confused. Structurally we know the mess we are in and things aren't getting any better (and this is a republican-to-the-core speaking). And psychologically, a 30-year-old playing at Risks-R-Us falls off the tricycle and vaporizes $6 bln in one week. Result? People yawn.

I recognize that this drumbeat has been playing in the 'Ville for a while and the Minx really has not cared about what our prevailing thinking is. But then again, it hasn't mattered either that Mr. Hunter made $800 mln last year before deciding he was smart enough to arbitrage the weather between October and December, using double digit leverage to boot. It's all fun and games until someone loses an eye...and/or $6 bln.

The point of this rant is that this backdrop is pushing me to the trading/investing sidelines, and given that trading/investing is what I do, sitting on the bench is no fun. My only recent activity has consisted of closing positions that had served their purposes, and trying to scalp energy plays. The latter more to keep me awake than to make me money.

So What Ideas Are Out There?

The chart of Fair-Isaac (FIC) caught my eye, and given the little I know about it, I'll give it a fundies look as it may pair well against the lenders exposed to the housing bust. Also, I have been selling puts on Joy Global (JOYG) as it scrapes the lower end of its historical valuation.

Other than that, I am sitting, watching, waiting and reminding myself that having the patience not to play is better than falling off the tricycle.
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Positions in JOYG
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