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Random Thoughts: The Unfreezing Process


Finding a way through this thing.

Editor's Note: The following was posted in real time on our premium Buzz & Banter. It's being shared here for the benefit of the Minyanville community. See also Mickey Mantle Won't Pay Our Rent, Dusting Off the Bull Costume, Miso Horny? and Capitulation Now?

How Do I Tell Them That Due to the Unfreezing Process, I Have No Inner Monolouge? - 12:45 pm

The following unedited thoughts are the very first things to flicker behind my tired eyes:

  • Through pure eyes--and careful not to post-rationalize--we've long offered that M&A deals would be a incremental positive for the market. Wells Fargo (WFC)-Wachovia (WB) and Eli Lilly (LLY)-Imclone (IMCL) qualify as such.

  • Many of my tries are with common stock as option volatilities are fatter than Sherman Klump.

  • Perhaps VXO 70 is violated into the close (after the forced selling hits) but, using crayons not pencils, we got "close enough" with this morning's print at VXO 66.30.

  • The greatest risk to the market continues to be counter-party exposure and a complete loss of confidence in the capital market system.

  • One could argue that faith in free markets ended a few weeks ago and it well might have.

  • Wowzers, was it really just a year ago that folks were pushing Dryships (DRYS) at 130 as the play for the new paradigm?

  • For those with the skill set to do so, selling downside puts isn't the silliest thing I've ever heard given the volatility spike. If you're "put" the stock, you have a cheaper cost basis and if not, you'll take in the premium.

  • If you don't know what I'm talking about, please avoid the above bullet altogether. This is no time to experiment or learn on the fly.

  • To get through this, we need to go through this. It's a bitter pill, I know, but one that is a long overdue part of the price discovery process that will ultimately facilitate better days and easier trades.

  • Yeah, I'll likely be early on this as well.

  • I can accept being wrong. I don't mind being humbled. But taking away our football Sundays is simply unforgivable.

  • There are many reasons for profound sadness. That too is an emotion, however, so let's leave tears for weddings and funerals and focus on our task at hand between the bells. If we take care of the minutes, the hours will take care of themselves.

  • And yeah, I'm all for throwing the book--no, the novel--at those who transgressed as we identify those culpability.

  • With regards to any and all thoughts that I've shared (QLD, GLD, Weatherford (WFT), Transocean (RIG), Baidu (BIDU), Apple (AAPL), consumer non-durables), I'll again communicate that, as a trader, I'll be moving in and out of that risk as a function of time and price.

  • It's impossible for me to offer a faceless audience advice--everyone has a unique time horizon and risk profile--but it's been our long-standing mission in Minyanville that sharing our process adds value to yours.

  • Now hit me again Ike and this time put some STANK on it!
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Positions in QLD, GLD, WFT, RIG
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