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Random Thoughts: Financials Stand Their Ground


BKX 60 looms under the banks.

  • Alan Greenspan is saying "this crisis will be with us for a while" and we're "on the brink of a recession?" He went on to defend his policy, saying it "didn't fuel the housing boom" as the emergence of the sub-prime market is "beyond comprehension" and the "most complex" he's ever seen?

  • DUDE! That's like a chef saying food poisoning in his restaurant had nothing to do with the ingredients of his meal. We don't do acrimony in the 'Ville and I'm not gonna start now. What I will say-again-is that our current conundrum is a function of FOMC policy since the turn of the century.

  • While I'm encouraged by the action in the financial complex-they held their ground during the morning flush and, in the process, held BKX 60.

  • The cause for pause? Market internals can't get out of their own way (NYSE are still almost 2:1 negative).

  • I'm no fibber-there were a few times, such as when the market closed Friday and yesterday-when I said to myself "Self, you scripted the melt scenario, what the heck are you doing trading the banks from the long side?" The answer lies in the question itself. I'm trading-not investing-just trading, dog.

  • Given 1) I'm still involved and the session isn't over, 2) my average cost is a touch higher (although I layered into a bunch yesterday) and 3) it's Turnaround Tuesday (and tomorrow is promised to nobody), I'm NOT counting my chickens or chips.

  • Rather, I'm "trading around" some overage, operating with a Chloe face and repeating to myself "trades are made to be taken." That doesn't mean right here, right now, but I'm not opposed to feeding the ducks into the quack attack.

  • Watch Goldman (GS), Wachovia (WB), Citi (C) and Bank America (BAC) as dry eyes and keep your right hand up in Fannie (FNM), Freddie (FRE) and Washington Mutual (WM), which were fielding some serious supply this morning.

  • Trade, don't hope.

  • With my 39th birthday out of the way, this Minyan is embarking on one helluva health kick into the back half of the summer. That includes diet, knee surgery (at a point) and, heck, even a trip to the dentist. With the big four-oh now bearing down, it's time to buck up!

  • I, for one, like the new MV Buzz TV backdrop. Anytime the critters are bigger than I am, it's a step in the right direction. That has, after all, always been the vision.

  • It's official-Californication is my favorite show on television. It's not because I can identify with Hank Moody (outside of his literary frustration), it's just well written with strong acting. You're up Jack Bauer, impress me.

  • The NY Times took a hard look at Google News and its lack of relative success in the field. If the Internet is deflationary, Google (GOOG) is the single biggest driver "information deflation" in the world. We can't help but wonder if Google has become a victim of its own success. In that vein, we continue to watch $525 as a technical level. If that gap begins to fill, it "works' to $450 on the chart.

  • I'll tell ya, they should change the name of Facebook to "Worlds Collide!" I can't tell you how many people I've reconnected with since joining. From grade school in Great Neck to high school in Encino to Syracuse to Mother Morgan to Minyans around the world. This is exactly what an A.D.D. person needs to keep their social network in order!

  • Quarter-end beckons and conventional wisdom dictates that we'll see a purge (of financials) and splurge (into big beta). I've been trading for over 17 years-which is, what, almost 70 quarter-ends?-and, if I've learned anything, it's that blind catalysts are dangerous. Whenever you're basing your decisions on the actions of others, you're at a natural disadvantage.


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Positions in WB, C
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