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Monday Morning Quarterback: What's the Good News?


If bulls hear what they want, a rally could ensue.


With a quickly missed weekend in the rear-view, it's time to opine on the action anew.

There's a lot going on for a summer Monday. Not only do we have thousands of hedge funds standing in a circle shooting at each other, we've also got expiration hangover and the implementation of the Braveheart short-sale rule.

On Thursday, we offered the Jump-Test-Run-Rest scenario. In other words, following the prior three sessions, Thursday's tape jumped higher, tested (the Wachovia (WB) raid), ran into the bell and, with a litany of overnight earnings (Merrill (MER), Microsoft (MSFT), Google (GOOG)), rested into the weekend.

The reaction to news is more important than the news itself, we know, and it's quite possible that we'll need to see good news rather than news that wasn't as bad as expected to further spur the herd. With hundreds of companies reporting this week-including Apple (AAPL), Texas Instruments (TXN), Caterpillar (CAT) and Yahoo (YHOO)-perception will be key.

We have some room left in the mean-reverting rally, mind you, but the easy trade, as they say, has passed.

Some Random Musings:

  • I wrote a column called The Future is Now offering that the big picture blues we've been eyeing in Minyanville for the last few years have finally arrived.

  • On cue, Fed Chairman Bernanke finally acknowledged them, paving the way for the biggest financial rally in history.

  • I pared my long exposure and, with the exception of a small Google short (sold half into $480, looking for $450 but will use a trailing stop), entered Friday's ride with a relatively flat book).

  • One of our Ten 2008 Themes was the other side of zero percent financing, or the financial crisis morphing into an economic, consumer-centric one.

  • PIMCO's Mohamed El-Erian was on FBN Friday talking about just that, along with a litany of other topics that Minyans know all too well.

  • He also said "We tend to think in existing paradigms," which is another way of saying that historical precedence need not apply.

  • We may have room to the upside but remember, Minyans, the stylistic approach in a bear market is to sell rallies just as one would buy dips in a bull market.

  • Hey Braveheart, there are upwards of $1.4 trillion of equities now on load, which is about 33% higher than the start of 2007 (Spitalfields Advisors).

  • If I were one of the banks left of the Fed's Keyser Soze list (protected from up on high by the Prince of Darkness), I would be extremely upset.

  • If you haven't read Pep's Guide to the Stealth Depression, please print it out as it's not to be missed.

  • Please soft-circle Friday, December 5th for our annual Festivus for the Ruby Peck Foundation for Children's Education.

Good luck, friends-trade like a Minyan today!


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Position in GOOG

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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