Monday Morning Quarterback
With the first two quarters under our belt, it's time to unwind the hand we've been dealt.
When she says she wants forgiveness
It's such a clever masquerade
She's so good with her stiletto
You don't even see the blade
Good morning and welcome back to the flickering pack. With the first two quarters under our belt, it's time to unwind the hand we've been dealt.
Benchmark performances are locked and loaded for the front nine of '07, with the mainstay proxies notching 7ish% gains. Strong first half, no doubt, as the pace car points to double digit gains anew. The bovine gotta feel good about their prospects, particularly given the angst of late and the proverbial wall of worry.
Still, the caveat in our midst and the key to the vault isn't what's seen on our screens, it's what lies beneath them. As quarter-end letters hit the mail, the question we must ascertain is whether the multitude of funds invested in the trillion dollar CDO space eluded the dreaded mark-to-market.
If they did, they've got another three months of shelf life, one more quarter to play the game and claim their fame. If not, the daunting dominoes have already begun to tumble and we'll start hearing horror stories in the coming weeks.
Why would that matter to you? Because in an interwoven financial fabric tied together by hundreds of trillions of dollars worth of derivatives, the sword swings both ways. And just as you didn't have to be involved in private equity to benefit from the LBO boom, you don't need to be subjected to sub-prime to suffer from the fall-out.
Random Thoughts into the holiday week…
The key tell on Friday, once again, was the financials as GS, LEH, MER, BAC and BSC all flipped the early downside switch as the broader market was probing the highs. Rotation out of laggards (so fund managers didn't show 'em on their sheets) or endemic of something entirely naughtier? The answer to that question will pave the way for the holiday week.
I'm not loving Entourage of late but I will say that John from Cincinnati is beginning to garner favor. And no, I'm not talking Succo although there are indeed several snazzy similarities.
It'll be uber-thin this week (particularly Thursday and Friday) and that'll open the door for increased volatility. Allow for that through smaller positioning as the last place you wanna see fireworks is on your bottom line.
Good luck this week, Minyans-let's do this!
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 email@example.com.
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.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Daily Recap Newsletter