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Random Thoughts: Fed Running Out of Bullets

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Are they out of ammo as we test the lows?

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  • As shared real-time on the morning Buzz, I unwound my shorts in the drillers out of the gate-taking profits in the Schlumberger (SLB) and Halliburton (HAL) puts on the gap lower opening-and bought Baidu (BIDU) and Apple (AAPL) for a pure trade as they slipped into the abyss.

  • With the double bottom in place (S&P 1270, DJIA 11640), I continue to feel that traders will buy dips above those levels. That should be good for at least a try higher, at which point we'll finger the pulse anew.

  • While grabbing a coffee at the kiosk this morning, I was reading the Post and said to myself "Jeezums, for $4300, I sure hope she did the dishes." The woman behind me (who I realize was there) gave me a look that would freeze ice.

  • During the real season, I would have a problem with this. In the pre-season, I don't see what the harm is.

  • Where there's smoke, there's Bear Stearns (BSC). Large Cap high profile brokerage firms that swing 15% per session doesn't give Hoofy the warm and fuzzies.

  • It is, however, the type of panicky action that might-just might-be an obvious after-the-fact sign of a short-term low.


The Following Buzz took place at 11:12 EST...

  • See Fannie (FNM) and Freddie (FRE) as they flip the upside switch.

  • Ditto Merrill (MER), which is trying to do the same.

  • Homies too, homies.

  • Alotta the energy names as well, including Smith International (SII) and Nabors Industries (NBR). Better to be lucky than smart.

  • Beta isn't acting as well as I would like--yet--but that's par for the course. Nothing comes easy in this tape.

  • I've been pretty negative for a long time and trust me, I still respect the risk. Still, having covered my shorts and collected long exposure--with defined risk--I'm trying to do what traders do. Hit it to quit it and, at times, sit it out.

  • I'll be speaking at tonight's 10th Annual Techapalooza Shindig at Bear Stearns. From there? Fam time, Yo, as my bro is in town and there aren't many things better than tossing a few back with your blood.

  • So you know and so it's said, I plan to revisit the dark side in the drillers at a point.


Engine Room, More Randoms!

  • If you've never spied Things I've Learned, it's worthy of a gander.

  • Given how many bullets the Fed has used, how much ammunition will they have left if we again test the lows?

  • I remember when Minyans mingled in the Mountains as far back as 2004 when we spoke about $100 crude and $1000 gold. Some people looked at us like we had sixteen heads and others, as my inbox would dictate, took our words to heart (and wallet). Noice.

  • How great was B-Rabbit in his freestyle battle against Papa Doc?

  • As I'm outie tomorrow, I plan to have a flat pad (outside of some meaty situations) such that I don't spend tomorrow's plane ride stressing about risk I can't control. There aren't many things worse than that. Outside of carnies, close talkers and people who chew with their mouth open, of course.

  • May peace be with you.


R.P.

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