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Freaky Friday Potpourri

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Be careful of what you wish, if for no other reason than for why it might arrive.

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There's been alotta chatter out there regarding this Blackstone IPO. In fact, Mr. Practical weighed in with his take. I posed a question this morning, asking if the IPO's of hedge funds (Fortis) and private equity (Blackstone) would inject a massive, final bubble of liquidity into the market.

Remember FIG Newton? The thrust of that column is pertinent for this discussion. The markets, when you assimilate our four primary metrics, come down to one basic, simple, constant premise: supply and demand. IF (this is a big if) more funds tap the public appetite, it could conceivably give the debt dependent drunk another drink.

The hangover will be cumulative and painful, but anyone who's ever had too much to sip will tell you that they're not thinking about the next day when they're tossing 'em back. The same can be said for our financial standing in general, I suppose, as central bank policy shifts the burden to our kids and their kids. THEY will pay the price for our immediate gratification, A.D.D. society, not us; but alas I digress.

As traders, we're more interested in the journey rather than the destination. And as someone who has concerns regarding the structural imbalances embedded in our globalized, finance-based, derivative-laden financial fabric, I'm always trying to identify the other side of the trade. This could be a goose that we'll gander upon, in time, so I'm simply trying to see all sides and manage my risk.

Random Thoughts…

  • See LEND bend (-4.5%). It's been a pretty good proxy for sub-prime concerns and, ergo, the financials, which, ergo, shape the tape.

  • What the heck is ergo anyway? I use it all the time but I couldn't tell you what it means.

  • It's Freaky, it's Friday and there's only four hours left. Nice.

  • Me and Lorenzo rollin' in the Benzo? The unexpected pop in new homie sales gave a bid to the tape as folks extrapolated the potential for an easier ease (Easy-E?). We can debate the merits of that train of thought but we should respect the train. And the thought.

  • Indeed, the light at the end of the tunnel (rate cuts) may be a steam locomotive, rollin' down the track. Be careful of what you wish, if for no other reason than for why it might arrive.

  • Tickle me tea leaves? We've got marginally positive breadth on the big board (flat Nazz), mixed financials (watch this group--it's that important) and a flat dollar. That sounds like a recipe for an extended weekend to me.

  • For what it's worth, and don't quote me, I've seen much better sellers into this lift. That's subject to change, natch, but I wanted to pass it along. O-Dog would have it no other way.

  • Yeah, yeah, I know we've been talking about this for a while but I guarantee you that we've got a monster in the hopper that is gonna blow the doors off MVTV. Wait'll Otis sees this-he'll LOVE this!

  • "Todd, ergo is Latin for "therefore." There. I finally put my two years of high-school Latin to use!" Minyan Bill from Maine .

  • Enjoy the weekend, Minyans, and be good to others and better to yourselves. You've surely earned it.


R.P.

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