The degree to which the bullish tone has gone from nuts to insane reminds me of only one other period in my trading career - 1999 Internet stock bubble. We have no selloffs we have a crew of stocks that are trading so far above their moving averages that its almost becoming immeasurable, every "analyst" who comes on TV has a higher price target than the one before and we have a FED that as usual is doing all the wrong things. I believe AAPL is almost larger in market cap now than Exxon Mobile - Steve Jobs is the Sultan. At this point I dont wish for a decline I wish for a crash of epic porportions - the kind that happens overnight and no one has a chance to get out - people have lost any and all fear of equities - equities are now like a warm blanket - need em to sleep at night...the riskier the better.
One little nugget in the news really pissed me off today - GM who at the governments urging screwed their senior bondholders, breaking all kinds of contract law precedent, is paying its workers larger bonuses - the guys who kept their jobs cuz the bondholders got screwed - how bout just sending that money to the bondholders?? I Guess the car CZAR (proper title) would not approve of that.
I stare incredulously at my screens as the market just pushes higher almost 24/6 with virtually no downside volatility. How does it all end?? Boy I wish I knew. As for me I stay long and short, the latter part ever so painfully and pray for more volatile times ahead - maybe a big middle easter power struggle - oh wait we had that, maybe a big back up in long term bond rates - oops we had that, maybe an exploding national debt - got that too.....who knows?? Maybe if the economy just creates some jobs then everything will implode......
Good luck
JB
Monday, February 14, 2011
Monday, January 24, 2011
Boy Have I been a fool
A Bear Mauled by his shorts but saved by his longs. Im lucky to be standing - even luckier to have finished 2010 up a bit over 10% net of all fees. I truly am long short - had there been no shorts in 2010 life would have been way more pleasant and stress free. So since the March 2009 low in the S&P of 666 we have rallied something like 90% which is even more than the market rallied back after the 1929 crash - pretty heady stuff. The market continues to put blinders on to any and all problems and is totally convinced that corporate profits will continue to rock and that people will have no problem paying the same multiple of earnings in a world dominated by cheap money courtesy of insane central bankers globewide. One of the most amazing displays of investor complacency is the strength of AAPL after Steve Jobs announced a relapse of his health problems.
The last time Steve Jobs took a health leave the stock was about $90 it is now $340 or so....I dont think there is a person on earth who thinks AAPL would have gotten to where it is without Mr. Jobs.....but now for some reason they have no fear, obviously AAPL is on solid ground and is the envy of corporations the world over but Jobs makes the company, he is the man on stage with the black turtle neck and jeans...when I saw he was taking a leave I figured the stock would drop $50 - its barely down $10 from the highs - people have no fear. If any lesson has been learned since Bernanke and Paulson asked for their Bazooka its that longs are in the driver seat and shorts are lucky to survive. I have no short in AAPL but I sure think in the long term the company is weaker without Steve Jobs - the man is a visionary.
There were some punk earnings tonight after the close from American Express, Texas Instruments and VMware yet as usual the S&Ps trade firm overnight. I figuer by morning they will be down a bit. The financial crisis is not over by anymeans its just a normal part of life now. The obvious 800 lb gorilla is the state of the states and cities. Will we see a rash of muni bankruptcies??? I think we will, how they impact society remains to be seen...Stay tuned 2011 should be an interesting year - the street is very bullish so the surprises will be to the downside - I for one am ready.
JB
The last time Steve Jobs took a health leave the stock was about $90 it is now $340 or so....I dont think there is a person on earth who thinks AAPL would have gotten to where it is without Mr. Jobs.....but now for some reason they have no fear, obviously AAPL is on solid ground and is the envy of corporations the world over but Jobs makes the company, he is the man on stage with the black turtle neck and jeans...when I saw he was taking a leave I figured the stock would drop $50 - its barely down $10 from the highs - people have no fear. If any lesson has been learned since Bernanke and Paulson asked for their Bazooka its that longs are in the driver seat and shorts are lucky to survive. I have no short in AAPL but I sure think in the long term the company is weaker without Steve Jobs - the man is a visionary.
There were some punk earnings tonight after the close from American Express, Texas Instruments and VMware yet as usual the S&Ps trade firm overnight. I figuer by morning they will be down a bit. The financial crisis is not over by anymeans its just a normal part of life now. The obvious 800 lb gorilla is the state of the states and cities. Will we see a rash of muni bankruptcies??? I think we will, how they impact society remains to be seen...Stay tuned 2011 should be an interesting year - the street is very bullish so the surprises will be to the downside - I for one am ready.
JB
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