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Apple, Google Down for No Good Reason


Even giants subject to bear-market whims.


Greetings from New York, where Roget himself would be running out of ways to say "I don't like 'em long or short" by now.

Someday, there's going to be a big rally. That rally may or may not come after a massive drop. There's plenty to discuss in this fascinating, historic time - but there are simply no trades being generated from all the palaver and soundbites getting cranked out all over the place.

As Leonard Cohen sang, "Everybody knows the dice are loaded." They have been for a long time - but we now have committees who don't understand craps actively reloading the dice in closed-door meetings.

You can bet based on a hunch as to how the new game is going to be fixed. I have no idea. As a result, I remain largely cashed out and, if not "happy" about it, at least much less stressed.

Which doesn't mean I'm not watching the game unfold. Here's what's standing out to me about the train wreck du jour:

  • It's not the news, but the reaction. Apple (AAPL) is down $17 on a downgrade - what we in the industry call a "negative" stock reaction. It's $110 as I type. If I were a) addicted to taking risk or b) going to spend my entire day in front of the monitor, I'd consider a long shot with a $105 stop. Of course, neither A nor B is the case.

  • Speaking of cult stocks, Google (GOOG) is spelunking under $400 today on even less news than Apple. What does Google have to do with a debt meltdown? It's a stock, and thus subject to bear-market whims. The most darkly amusing thing about outlawing "evil shorts" is the idea that bear markets are brutal for everyone, bulls and bears alike.

  • Speaking of nowhere to hide, the Irish stock market fell 11% today, the Emerging Market ETF (EEM) is taking a 7%-plus beating, and China's FXI ETF is down 9%. Every culture has a word for "pain."

  • Far be it from me to speak out against venting and anger. I'm a big fan of both. I just don't think we're going to be able to speed along the free market "fixes" being proposed here. It's going to take time, and it's going to hurt. The market we knew for the last decade is gone. I'll mourn it, and I may even do a couple rebound-date type of trades. But it's going to take me awhile before I can trust again.

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No positions in stocks mentioned.

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