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News of Bank of America's, Steve Jobs' Death Greatly Exaggerated


Rumor-mongering nips at the heels of giants.


Happy mid-day from New York, where I'm watching today's pitched battle between the bulls' desire to keep last week's party hopping while Boo smashes them in the head with a stream of warnings and horrific data points.

This morning's tells are doing what they should, as Mosaic (MOS) and Toyota (TM) have been moving a tick ahead of the tape all day. At the moment, Toyota is a rounding error higher, and Mosaic is rather impressively digesting a large amount of volume well off the lows of the day.

For what it's worth, I've entered a starter as of about an hour ago (we'll get to the cause of the delay in a minute). $35 is the stop, and breaking over $40 would lead to a rather unseemly Icky Shuffle.

More broadly, from where I'm sitting (as always, on a silk pillow, atop a mountain with my robes flowing gently in the wind), how the market handles the reality of declining fundamentals now that we've had a huge rally from the lows is going to color the tape for the entire first half of '09.

By the end of this month, our Obama-Clocks will change from counting down to the inauguration to counting the number of days remaining in his honeymoon period - and we'll be in the middle of what should be a simply dismal series of fourth-quarter earnings reports and outlooks. There's plenty of cause for skepticism longer term but I'd be loathe to fight a rally that can shake off a series of fundamental bombs such as those we'll see this month.

Here's what else I'm watching and doing as I chug through my "Synthetic Friday" (defined as the day before I have a day off from television):

  • I hear what Mr. Cooper is saying regarding Jobs' Circus. Having been accused of mongering in rumors on the name in the past, I'll offer 2 thoughts:

    1) If a CEO doesn't want legitimate concerns regarding his health to be newsworthy, he should either resign or take the company private. At Apple (AAPL), which has been cagey on the topic in the past, helped foster the "cult" in the first place and never been successful without Jobs, his health is unquestionably material.

    2) It wasn't a circus last summer when we discussed his health on Fast Money and I wrote about it here; indeed, you wouldn't believe the heat I got for even bringing it up. Now that Mr. Jobs' health is the topic of the day, with the stock 40% lower, it's reasonable to assume succession concerns are in the stock. Live in the now; trade in the tomorrow.

  • Shipping continues to rip higher, as our old friend DryShips (DRYS) tacks on another buck. DRYS is actually making a fairly muted move in the category of "sub-billion market cap, heavily indebted, foreign-based shippers." I have no position, though I did manage to outrage the lunatic fringe with the suggestion that taking profits made sense. DRYS is up 40% in 2009 which is all of two and a half trading days old. I stand behind the notion that such moves aren't "Buy and Hold" entry points.

  • On the topic of Me Ticking People Off Accidentally, Minyan Caroline dropped into my Columnist Conversation with a post that more or less supports yesterday's assertion that the constant mental adjustments required to effectively trade tend to enrage folks. As for how Caroline expressed her annoyance, I stand behind my response and, as always, welcome all comers to the Conversation. It's a great forum for the Profs and an unmatched way for Minyans to get access to both the writers and one another.

  • For what it's worth, the Big Secret of financial television is that talking about why you were wrong is superior to bragging about being right. Mistakes have more intrinsic lessons, and there's nothing more obnoxious than "Let me tell you about my awesomeness." There's a reason I have an "Ask me about my Disney (DIS) long!" bumper sticker, and it's not because DIS as a stock or theme park has ever done anything but suck money from my wallet. As tonight's dinner companion says, "Sometimes right, sometimes wrong, always honest."

  • With all due respect to what my television has been telling me all day, Merrill's head of brokerage leaving the firm is neither shocking nor a harbinger of failure for Bank of America (BAC). BAC CEO Ken Lewis has swallowed more firms more effectively than anyone in banking, including Jamie Dimon. BAC may go down - but it won't be because Ken Lewis doesn't know how to digest what he buys.

With that, I'm off to get myself ready and set my DVR to record Becky Quick on tonight's Late Show with David Letterman. In a world of craziness and hidden agendas, Becky is one of the Good Guys. A warm fuzzy in a world of cold pricklies which I mean in the best possible way.

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Positions in TM, MOS, DIS

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