Randoms: Bottoms Up?
The sharpest rallies occur in the context of a bear market.
Editor's Note: The following was posted in real time on our premium Buzz & Banter (click for a free trial). It's being shared here for the benefit of the Minyanville community. See also The Big Bang Theory? and Big Ben Chimes on Wall Street.
Quick Draw McGraw! - 10:10 am
I've never been accused of premature evacuation (OK, that's not entirely true) but I sold a LOT into this pop. Indeed, if our binary catalyst is Thursday's mark-to-market hearing and the FOMC chairman is openly against it, my perceived catalyst is gonzo. For if they do, indeed, make a move, you'll have open dissension in the ranks (which isn't exactly a confidence booster).
So say goodbye to Hollywood and, for my part, say goodbye to General Electric (GE) (nice lil' schniztel), Jimmy Super Spy Snuka (SSO) and a slew of the trading crack (FAS). I've left some of that last vehicle on my sheets with a tight trailing stop but I'm not married to anything--or anyone, for that matter.
Now, we are very oversold and it is Turnaround Tuesday so I'm not pressing or guessing or otherwise messing with the short side (yet). I'm simply respecting the process, operating with discipline (defined risk) and taking each pitch as it comes. For if I know any one thing, it's that the first and foremost goal right now is to stay in the game.
Comments from the Fed Head - 10:50 am
Editor's Note: This post was written by Minyan Peter and is being reposted for the benefit of the Minyanville community.
I would encourage all Minyans to reread Chairman Bernanke's speech this morning, particularly as it relates to the various businesses and markets which the Fed will not allow to fail. Then look at how the foreign exchange market is responding.
There is a price being paid for the additional lifeguards at the beach.
But there are two questions that continue to haunt me:
1. If the backlash for excess returns is excess regulation, what is the impact on the timing and speed of our economic recovery?
2. For both the US and EU, if economic recovery does not take hold soon, who will save the lifeguards?
(Position in SSO, SPY options and JPM debt obligations)
Answers I Really Wanna Know... - 11:56 am
To Minyan Peter's point, what happens if the firetruck is on fire?
Is Bill Buchanan a mensch or what?
What's the proper lens in gold: down 10% in three weeks or up 34% since October?
Is anyone ready for some MADNESS?!?
When's the last time the world got so very excited by a 28 cent rally in Citigroup (C)?
While the buyers are higher (as we remind you on down days), shouldn't we remain conscious that the sellers are lower?
Have you given yourself the MV Litmus test recently (are you 'ok' up or down 20%)?
While my stated game plan was to sell the rally into Thursday, did Big Ben make my trigger finger itch?
Minyan Mailbag: Death of the Financial Advisor? - 12:40 pm
Good morning Todd,
You have commented recently about the likely exodus of funds from financial advisers. This has been no picnic, and I can’t claim to have gotten things exactly right, this financial adviser is getting a look at a lot of new money new, and I feel we are getting our share. Minyanville is a big part of the reason for that.
Don’t write off financial advisers yet, at least not those that are Minyans!
Thanks for what you do,
Minyan Daniel L
Fair enough, my friend, I certainly didn't mean it as a slight (never, to our community). My point was, big picture, money will likely migrate from 'traditional' services to self-directed platforms, where so called "individuals" can operate, quite hopefully with the thought provocation of Minyanville. The online trading platforms would be a natural and intuitive beneficiary.
Texas Flea! - 12:45 pm
As I sit here and chew the fat with an up and coming aspiring energy analyst--because I've got so much free time on my hands--I needed to note the downside flip switchage in crude (and, by extension, the USO).
Just another lil' something for your radar on a quiet day.
Bottom's Up? - 1:39 pm
We spoke yesterday about the sudden flush of bottom callers, folks pointing to investor sentiment, oversold readings, value propositions, game changing legislation and an improvement in credit markets. What was missed is perhaps the single greatest sign of fear ever before witnessed in all of mankind--Jack Bauer cried and drooled last night!
Hey, if I never ate, I would cry and drool too! (What, have you seen him eat?)
So here we have it, a strong move to the upside. As Minyans know, I've been operating from the long side of late--primarily the financials--for the counter-trend, make or break, get it up or grab your ankles rally.
When I left for my out-of-office meeting Friday, it looked like Hoofy (and I) were toast. Less than two full sessions later, the BKX is up 25% and you can hear the collective exhalation across the Street. There are indeed two sides to every trade, which is worth noting now.
Two points of Parliamentary procedure. First, the sharpest rallies occur in the context of a bear market. That's not to say this is a one-and-doner, it's simply a context with which to view the dew. Second, it is Turnaround Tuesday and as any old school Minyan can attest, this nonsensical dynamic has a weird way of proving true time and time again.
Following today's sales into strength, I'm flat as a sat on hat, with one eye on the action, the other on Washington and the Third Eye Blind. I'm respectful of further upside bungee, cautious of Pep's technical take (risk to S&P 593) and seasoned enough to understand that opportunity cost is the other side of discipline.
As always, you, thy faithful, are first up in the queue (cue?) on any and all thought as they happen, in real-time, on the Buzz. In the interim, I've got to power out my syndicated vibe (due today at 4:00 PM), handle some corporate communication (engine room, more steam!), talk to my book peeps (cat's out of the bag Yo!) and work with the team on our "double top secret" roll-out.
All in all, just another day in the 'Ville. As always, I hope this finds you well.
Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at firstname.lastname@example.org.
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