The land of the settng sun.......

China wants to curb growth plain and simple - who really knows whats going on there? No one - but they outwardly are saying they want to decrease lending. Our futures traded down to 1081 last night or down about 12 points but the buyers came in and the futures have clawed back to a much smaller loss of 2 points. Im not quite sure why but when am I ever?
Great earnings from AAPL and TXN last night. AAPL is a juggernaut - only negative was a decrease in IPOD sales - duh everyone has one or 5 in my house's case.
The china tightening of the reigns should hurt commodity and commodity stocks in my opinion.

JB

ahhhhh

The action thursday and friday was just what the Dr. ordered for me - I flattened a ton of short deltas in a bunch of names - sold some vol I was long - and now I will wait and see what tomorrow brings. Probably my biggest winner in this 5% down move was my convert vs common position in Freeport Mcmoran (FCX) - this was about the cheapest synthetic put I could find and it worked perfectly.
The SPUZ just opened up around $4 for the overnight session.
More when I have something good.

Good luck this week

JB

Roll a 7

Imagine you were playing craps and 7s came up 90% of the time - you would bet on 7 and only 7 - who cares about the other 10% of the time?
That is basically the bet the bulls have been making everyday for the last 10 months - its the bet that has fueled a 71% rally in the S&P since march 9th. Jim Cramer tonight muses that he should have been buying today as stocks were on sale - he has been a vocal bull for months OK so he put a super strong buy on GOOG at $625 and now its $575 - it can happen - ok he couldnt say enough about how great AVB was at $85 a share and now its $79 - minor details - overall he has been dead on - he should have just been buying S&Ps and forget the individual stocks. He is playing in a crap game betting on 7s when 7s come up 90% of the time. Thats how its been but now its time to channel your inner Gretzky and figure out not where the puck is but where its gonna be...
The current quarterly earnings are very much like looking at the stats on the back of a Mark Mcgwire or Sammy Sosa baseball card circa 1998 - hormonally altered - HGH in their case - massive stimulus and insanely low rates in stocks case.
Sosas homreun production went from 66 in 1998 to a more normalized 35 a few years later - remove the stimulus and whats left? Can the economy fire nice growth on its own or is it addicted to stimulus? Are Bernanke and Obama going to end up testifying in from of congress a few years from now fessing up about stimulus kind of like all of those baseball players?? If you are long you better hope not.
Earnings are coming in well and its hard to get your head around a decline but its possible - no one is looking for it - everyone is bullish - and we have not had a meaningful correction in months....Go to where the puck is gonna be - and when you get there let me know if Im on the right path.

JB

JB

I am thoroughly confused

Friday - JPM and INTC have "good" earnings - the both sell off and the market follows....
Today - Citi has "bad" earnings - rallys as does the market.
Today builders confidence number was worse than expected, ABC consumer confidence worse than expected, Insider selling continues at record pace - with virtually no buying, AAPL reports that its unveiling a new product that has been rumored and expected for weeks - and the stock rallys like $8 bucks?? What gives?? Apparently todays rally was fueled by the hope that Massachusetts senate seat was going to a republican - which I guess is bullish b/c it will derail the healthcare reform plan???? Who knows - so we have gridlock in Washington and thats a good thing right??
The VIX continues lower almost closed below 17 today - thats cool - forget about the facts that California and other states are basically broke - forget about the fact that the FHA is raising fees and making lending tougher http://finance.yahoo.com/news/Federal-Housing-apf-268619640.html?x=0&sec=topStories&pos=main&asset=&ccode=
Forget about everything - come in and buy the market everyday, every night - there is no risk - outlier events have no impact (Dubai - the Greece situation). Be long or be wrong!!!

JB

A well oiled machine

Friday was the first day with any selling pressure in 2010 - the futures open after this long weekend up about $5 points - negating much of fridays losses, the path of least (or no) resistance continues to be up. I guess the market is playing close attention to the situation in Mass - i would imagine republican is superbullish and democrat is just bullish - but im not really following the story to closely. Also noteworthy is that GOOG is backpedaling somewhat on its threat to leave China - that should send some ripples thru two major beta plays GOOG and BIDU - Bidu rallied on the GOOG news from 386 to 467 in a week. I put on some downside put butterflys in BIDU on that big rally last week - we'll see how those play out, I would imagine BIDU will give back some of those gains.
Anyways earnings news will be flowing in all week along with Citi and Goldman this week. Random thought if Citibank ever makes $1 per share again they will make over $20 billion..... thats funny.
Anyways - we'll see what tomorrow brings but this market has had an incredibly hard time stringing two down days togther - i guess first and foremost cuz you need one down day - but I digress.

JB

Interesting moment

Google is a powerhouse by anyones definition - Im not talking about its stock Im talking about its brand, name recognition, etc....They are threatening to terminate business operations in China - this is a watershed moment in my opinion for the communist country. Do they really want to be perceived as a country that one of the most revolutionary (no pun intended) companies in the world says is unworkable?? I highly doubt it - just my opinion. China needs to work this out with Google - they really do not want to turn away businesses do they?? Or perhaps Google is just playing a poker hand here maybe there is something big going on behind the surface - who knows? To me its an incredibly interesting situation.


JB

The worlds economic hope

hinges largely on China these days - I present you with an article that should make you shiver if you believe in China as the economic savior...http://www.marketwatch.com/story/google-says-its-considering-pulling-out-of-china-2010-01-12?dist=afterbell


JB

I hate the world

So everyone was expecting a big jobs number and yet it didnt happen and the market is miraculously unchanged. In fact the jobs number was disappointing - the only buyer of futures is the Obama administration - but who has more money then them. Its absurd - I should be getting paid today - big time -yet Im not the SPUZ are down $1 - its so absurdly rigged Im ready to throw in the towel.


JB

Its very obvious

That major players know that there will be a way better than expected jobs number tomorrow (see this mornings post) the SPUZ are turning a total blind eye to the fact that many important highflyers AMZN, BIDU, GOOG, PCLN are giving up the ghost a bit today. The question is when the number finally prints tomorrow (dont get me started on how stupid it is to fixate on these things anyways) and all of these guys have been buying ahead of it for two weeks - can we chug yet higher?? In two words, yes or no (ok that was three words). We have been rallying (except for the last hour on the 31st) since dec 21 - one might think we could get some profit taking but one might have thought that for a long time.
There was a juicy nugget in the home town paper yesterday - the University of Illinois is owed 436 million by the Illinois state government - the governor says the state should be able to pay some of that money after "a next round of borrowings" - the university says they are going to order 10 day unpaid furloughs for almost the entire staff this summer - this is unprecedented says the University president - he also said they are just going to have to hike tuition massively - k where are the payers of that tuition going to come up with money for a "massive hike"? I suppose they are getting "massive" raises at work - or maybe their stock portfolios have just taken off the last 9 months?? Again dont worry about real issues such as this just continue to worry about if AMZN is gonna hold at the 50 day moving average....

JB

Interesting

I read a post over at WWW.ZEROHEDGE.COM about tomorrows nonfarm payroll report - it says basically due to a host of seasonal statistical reasons and the real nitty gritty of how that number is reported that tomorrow might show an add of over 300k jobs - clearly if that is reported the bulls and CNBC will be breathlessly saying that the jobs recovery is here yada yada yada - it certainly will grab headlines - thats if this research report I read is right - I would imagine at somepoint today GS will put out its prediction on the jobs number - perhaps that is fueling this unyielding bid in the futures - they know the jobs number will be a major positive surprise (regardless of it being a BS massaged number) and tomorrow morning on some huge gap higher they will sell??? Dunno - just food for thought.

JB

Angst

Is it me or is there a lot of angst in this never ending bull run? I sense something is happening - perhaps its that the big nasdaq leaders all seem like they are on a crash course with one another in the mobil space - perhaps its that Greece is about to default and YES will need a bailout - perhaps its that commodity stocks - coal, steel, fertilizer are leaping - these were the last gasp movers in 2008 as well. Maybe Im just looking for something? The SPUZ are stubbornly bid as usual - and imagine this the nasdaq futures are unched with GOOG down 11.5 and AAPL unchanged, RIMM down 1.15 (RIMM is so yesterday) - how is that possible?
Sign of the times Beazer homes is doing a secondary and convert offering tonight - It will be interesting to see what the coupon is in there convert - im gonna try and buy some - but its a 50 million dollar deal so Im sure its being sold to a couple large funds and it will never trade ever.

Anyways Im long a little Citibank here (the idiot trade) leaking out around 3.6.

Later

JB

You are getting Sleepy

After a harrowing 5 point futures dip overnight the drones are back at it with futures clawing back close to unched on the day - surely they will be positive at 830 when the stock gunners start in earnest.
Because the beta chasers need something to do everyday this morning BIDU is up 3.6% - im sure there is a great reason why.
Jim Cramer said this morning - "can you ever imagine Ford back at $9??" is he serious? is this to mean that the business cycle will never turn negative again and that Fords equity price might drop? The bullish sentiment outthere is thick - the vix continues to drop, pullbacks last for minutes, people dont exaclty understand why the market keeps going up but they say they "want to ride it" sounds dangerous to me.

Good luck

JB

New year same ole bullshit

The slightest hint of weakness this morning was met with strange, bizarre unwavering buying interest. Kinda like when you were a kid and you were afraid someone was gonna beat you up and your older brother said dont worry I got your back. This older brothers name is Sam and he is usually called Uncle. Makes it tuff to trade - cuz you never know when that game is gonna end.
BETA names are mixed - commodity stocks are higher , yada yada yada.

JB

The Consumer will Save Us

http://online.wsj.com/article/SB126263231055415303.html?mod=WSJ_hpp_MIDDLTopStories

Or maybe not??

JB

Wow - thud

An enormous move today 1.55% or so. For four hours of the trading session the market was in a 3 point SPU range - so they were willing to chase stocks up 1.5% but not a penny more till you wake up in the morning and the SPUZ are up the requisite 4 to 5 bucks. WTF? Who pays ever higher prices all the time - we are up like 8 out of the last 10 trading days - not bad!!! Once again remember Barack Obamas famous words "I think its a good time to buy stocks" from about 9 months ago. Would he ever say something like "lets not be pigs people, trees dont grow to the sky" - nah thats unAmerican it has to end in a thud - we are the bubble country, stocks, credit, housing, stocks again - whats next? Oil is getting very pricey again which is FOSURE a negative for 99% of the US populace. Do you like paying $3 and more for your fillups? In this recovering economy is that gonna be a help when people/companies start paying more and more for oil?? All Bernanke has to do is stop printing dollars raise rates a bit and oil will get crushed - but he wont do that- so oil will go higher and eventually will crush this budding recovery. We are in a box - and each side is sealing shut - medecine has to be taken. Unless you are one of the special companies AAPL, GOOG, AMZN that is really experiencing huge growth the world sucks. The disconnect between the stock market and the realities as I see em have never been bigger. People say multiples are low - well honestly should you be paying a lot for stocks when there is 11 trillion dollars of tax payer money backstopping everything and fedfunds are 0-.25% - there is only one direction those rates can go. All this is unimportant to what the next "move" will be in the market - the beast is gonna do what its gonna do - this is a masterfully peaceful tape that has a blind eye turned to anything negative and a never ending desire to print higher. Commodity stocks are powering the market higher I read somwhere today - ahh ok so all your inputs are going up so "markets" zoom higher - unless you produce that commodity this is a negative. If you are a builder and copper is getting more expensive by the day this is a negative if you are Freeport Mcmoran and you mine copper this is a positive. blah blah blah

Good Luck tomorrow

JB

Blast off

Stocks are loving 2010 so far as the major averages are up 1.5% or so - futures are well bid as they were all night, Oil is flying higher as is gold etc....you get the idea. A world meltup day - why not?
The zenmaster beta stocks are all higher with one exception, AMZN. There must be a glitch in the computer program that guns these names everyday. Nothing of real value to add this AM - bonds are flat today even with a strong ISM number today perhaps to many people are playing for a zoom higher in rates??? Crowded trades are killers.
Gas is about to be $3 bucks a gallon soon - but why would the guys on wall street care about that??

JB

2010 Trading is underway

The SPUZ are trading and so far 2010 looks just like 2009 - a nice calm $4 buck advance in the overnight session. Im not ready to harp on the endless bullshit rally we have been enduring for the last 9 months so Im gonna do what all of the big dawgs do Im gonna make some 2010 predictions.
In no particular order
1)The Iranian government will be overthrown either by the population or by the population with an assist by an Israeli Military strike.
2)Barack Obama will surge momentarily in popluarity as jobs start being created again but he will then plummet in popularity as bond yields zoom higher crippling home prices and crushing stocks - the plunge protection team will give up.
3)Goldman Sachs goes private and will end up screwing Warren Buffet as they will take themselves private at a price that makes his warrants worthless - he being the ultimate gamer will just smile as the joke will be on them - he has hedged all of his Goldman Warrants by shorting stock in the 160-170 range.
4)State governments will continue to suffer as demand for services will continue to rise as tax revenues stay stubbornly stagnant. States will be going to Uncle Sam hat in hand looking for cash - luckily I live in Illionois - el presidentes home state
5)Consumers will stay frugal and some less imperative retailers will dissapear. Perhaps Saks, perhaps Sears or maybe some mall favorites like American Eagle Outfitters.
6)The American Public will become increasingly tired of business as usual in Washington and congressman and senators will be under major fire as they are totally out of touch with what people really need. Political unrest will creep into the picture in America.
7)A few pro sport franchises will go bust and actually shutdown
8)Chrysler will only make the Jeep brand as no one wants a Chrysler or a Dodge.
9)Jim Cramer will be taken off of CNBC
10)Banks stocks languish again as loand demand is tepid and credit quality for the consumer continues to deteriorate - credit cards become harder and harder to get.

JB