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Random Thoughts: Paulson's 'Energized' Testimony


Stay humble or the market will do it for you...


Editor's Note: As Toddo was dragged out of MVHQ for an important out of office meeting by his pant legs, clinging to his eighth screen, he yelled out his last request: To recap his morning buzzes as a Random Thoughts article in the hope that Minyans everywhere would benefit from his insight. So, without further ado, here they are.

  • The following Buzz occured between 9:00 AM and 10:00 AM...

    Gate Sniffage!
    9:38 AM

    • After trading seven ways till Sunday (and seventeen ways since last Sunday), I enter the center with a spate of short puts and defined risk above BKX 111.50.

    • In the interest of forthright communication and real-time education, I will share that I pared some of the puts (that I tossed on after yesterday's contra-hour Snapper). Net/net, I added downside exposure on the day and while I sorta figured I would have better prices this morning (to remove the excess trading inventory), the mechanics of the swing are more important than the results of the at-bat. That's the nuts and guts of why I'm tellin ya'.

    • In all due respect--and I'm all about respect--I gotta ask the question as it's the central tenet of our current credibility conundrum. Hank Paulson assured us this morning that we have the benefit of a "strong global economy" and a "healthy financial system"--and I understand why he has to do this--but, as he also assured us that sub-prime was contained a few short months ago, how long will his words carry weight?

    • And what exactly does "Paulson has 're-energized' working group on financial markets" mean? Is the Plunge Protection Team wizardry officially out from behind the curtain?

    • The semis trade dry out of the gate. The homies and banks, not so much.

    • An off-site meeting? Today? With this volatility? In the pouring rain? Only for our friends from TD-Ameritrade.

  • The following Buzz occured between 10:00 AM and 11:00 AM...

    Cup O' Buzz
    10:40 AM

    • Y'all know what I've traded thus far today? Not much. I've made my bed--which includes downside S&P exposure, a stop above BKX 111.50 and lotsa dry powder--and I'm laying in it.

    • Given how hard it's pouring in Gotham, gimme a pint of Ben & Jerry's and some Young Frankenstein and I'll be cooler than the other side of the pillow. Not in a "that trade is a given and I'm complacent" sorta way, just from a "I'm gonna be out-of-pocket this afternoon and I'm loosening my grip the handlebars" standpoint.

    • All of this is said with a nod to the Trading Gods. If I've learned anything over the years, it's to stay humble or the market will do it for you.

    • Note that Capital One Financial (COF) is higher on the mortgage abscission and guidance cut. I'm not 'sure' what it means but it's more positive, in the abstract, than negative.

    • Also in the "glass half full" camp, please see the action in beta--from BIDU to AAPL to UA to AMZN to EBAY--lest you're wondering where the money from the financials is rotating.

    • I'm getting that look--you know, that look--from President Fish that it's time to jet. I'll tell ya, these media guys... You're in good hands---with Allstate and Minyanville--so lemme jump and juggle and manage this struggle. Fare ye well, Minyans, and keep that right hand up.

  • Have great afternoon Minyans, and let's put some jingle in those jeans!


No positions in stocks mentioned.

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

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

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