Time to short Stocks!

[Toro]

The market is selling off because QEII was underwhelming.

There are two big issues next week, the Fed and the election. The Fed is telegraphing that QEII will be less than the market is expecting. The market is expecting a Republican victory in the House. That is what I'm expecting. What if the Dems win instead? That's a negative. What if the GOP wins the Senate? That is a positive. But if it is anything other than the GOP winning both chambers, I would expect a sell the news reaction, which may be kicking in now.

Short term you're probably right. Markets rose anticipating a GOP victory. All that news is out and discounted.

I expect stocks will be higher some time next year, so I will be covering my shorts into this sell-off.

 

[william the wie]

This will be interesting.

 

[FireFly]

Time to short Rare Element Resources Ltd. (REE)

 

[editec]

Much of that cash is overblown, since its sitting outside the United States and won't be repatriated because of the 35% tax rate. Most of the debt that has been raised has been to extend existing debt or lower interest payments or to just take advantage of the lowest rates in a lifetime that will probably be recycled back to shareholders. The change of government will improve moods but the problems in the economy are structural and there is too much capacity. Lowering taxes or being more business friendly won't change that.

Bingo!

The problem is the imbalance between supply and demand.

I'll leave it to you genuises to figure out how things got that far out of kilter.

But if your investigation into this doesn't include the phrase income inequity?

Then you're still don't get how the macro-economy really works

 

[The Rabbi]

Much of that cash is overblown, since its sitting outside the United States and won't be repatriated because of the 35% tax rate. Most of the debt that has been raised has been to extend existing debt or lower interest payments or to just take advantage of the lowest rates in a lifetime that will probably be recycled back to shareholders. The change of government will improve moods but the problems in the economy are structural and there is too much capacity. Lowering taxes or being more business friendly won't change that.

Bingo!

The problem is the imbalance between supply and demand.

I'll leave it to you genuises to figure out how things got that far out of kilter.

But if your investigation into this doesn't include the phrase income inequity?

Then you're still don't get how the macro-economy really works

I disagree there is a structural problem. My analysis does not include the phrase income inequity. Heck, I dont even know what that means.
And I think I understand the macro economy a heck of a lot better than some pissant third-rate Marxist.

 

[Toro]

There is definitely a melt-up going on in some parts of the market. And its being driven mainly by QE2. To see silver go up 40% in two months on no intrinsic news is amazing.

There are some internal breakdowns in the stock market, however. We'll see if it matters.

 

[editec]

Much of that cash is overblown, since its sitting outside the United States and won't be repatriated because of the 35% tax rate. Most of the debt that has been raised has been to extend existing debt or lower interest payments or to just take advantage of the lowest rates in a lifetime that will probably be recycled back to shareholders. The change of government will improve moods but the problems in the economy are structural and there is too much capacity. Lowering taxes or being more business friendly won't change that.

Bingo!

The problem is the imbalance between supply and demand.

I'll leave it to you genuises to figure out how things got that far out of kilter.

But if your investigation into this doesn't include the phrase income inequity?

Then you're still don't get how the macro-economy really works

I disagree there is a structural problem. My analysis does not include the phrase income inequity. Heck, I dont even know what that means.
And I think I understand the macro economy a heck of a lot better than some pissant third-rate Marxist.

Of course you do.

But you'd have given yourself more credibility if you didn't feel the need to add that pointless ad hominen insult.

It is possible, you know, to disagree without being disagreeable.

 

[The Rabbi]

Bingo!

The problem is the imbalance between supply and demand.

I'll leave it to you genuises to figure out how things got that far out of kilter.

But if your investigation into this doesn't include the phrase income inequity?

Then you're still don't get how the macro-economy really works

I disagree there is a structural problem. My analysis does not include the phrase income inequity. Heck, I dont even know what that means.
And I think I understand the macro economy a heck of a lot better than some pissant third-rate Marxist.

Of course you do.

But you'd have given yourself more credibility if you didn't feel the need to add that pointless ad hominen insult.

It is possible, you know, to disagree without being disagreeable.

True. But what fun would that be?
And did you think I was referring to you as a "pissant third rate marxist"?

 

[Toro]

Covered all my shorts this afternoon at a small loss. I think a downdraft is coming but stocks seemingly want to keep floating higher. QE2 is all that matters.

 

[william the wie]

Covered all my shorts this afternoon at a small loss. I think a downdraft is coming but stocks seemingly want to keep floating higher. QE2 is all that matters.

You've just summarized why I like the Black Swan approach, too bad fund buyers hate it.

 

[Toro]

Lots of negative divergences. But that often happens in melt-ups. I am wondering if I should reestablish my long gold and silver positions. Silver hit a multiple-decade high today. Gold may have also put in a bottom.

 

[Zander]

I am sticking with my short position. To me it seems that any "good" news is already baked in the cake, bad news of any kind will send stocks lower, significantly lower.,....think "flash crash" x 2 or 3......

 

[Paulie]

I am sticking with my short position. To me it seems that any "good" news is already baked in the cake, bad news of any kind will send stocks lower, significantly lower.,....think "flash crash" x 2 or 3......

Not necessarily. The bad news seems to be good for the market, because it reinforces QE2.

More money creation, higher asset prices.

You need to be looking at this whole picture in different ways than just "the economy is bad, so stocks should suck".

We're in different times now, my man.

 

[Zander]

I am sticking with my short position. To me it seems that any "good" news is already baked in the cake, bad news of any kind will send stocks lower, significantly lower.,....think "flash crash" x 2 or 3......

Not necessarily. The bad news seems to be good for the market, because it reinforces QE2.

More money creation, higher asset prices.

You need to be looking at this whole picture in different ways than just "the economy is bad, so stocks should suck".

We're in different times now, my man.

It is social mood that scares me, not the economy. Either way, I am not going to be hurt financially. I only have "play money" at risk. I could lose it all and not bat an eyelash - i wouldn't be happy about losing it. but it won't really hurt me (other than my ego!). My "serious" money is invested in my business, my real estate, and in cash. This is just for fun. It's kinda like my version of a "vegas" trip.....

 

[william the wie]

Zander the profits are bigger but longer term if you use leaps. You can buy leaps 12-18 months out at relatively cheap prices and melt up or meltdown just add lost minimization positions as the market wanders. Crashes and run-ups happen about once every four years and when they do your profits are huge.

 

[Paulie]

I am sticking with my short position. To me it seems that any "good" news is already baked in the cake, bad news of any kind will send stocks lower, significantly lower.,....think "flash crash" x 2 or 3......

Not necessarily. The bad news seems to be good for the market, because it reinforces QE2.

More money creation, higher asset prices.

You need to be looking at this whole picture in different ways than just "the economy is bad, so stocks should suck".

We're in different times now, my man.

It is social mood that scares me, not the economy. Either way, I am not going to be hurt financially. I only have "play money" at risk. I could lose it all and not bat an eyelash - i wouldn't be happy about losing it. but it won't really hurt me (other than my ego!). My "serious" money is invested in my business, my real estate, and in cash. This is just for fun. It's kinda like my version of a "vegas" trip.....

Well the social mood kind of goes hand in hand with the economy. The economy sucks, so the mood is dismal.

But shrugging off your losses because you don't care about the money doesn't really help anything.

I'm just saying that these days, you need to widen your viewpoint on things because it doesn't seem like the same old market anymore.

The Federal Reserve is fucking nuts. They and the banks are playing some serious games with this market. Don't let them beat you at their game.

 

[Gadawg73]

Not necessarily. The bad news seems to be good for the market, because it reinforces QE2.

More money creation, higher asset prices.

You need to be looking at this whole picture in different ways than just "the economy is bad, so stocks should suck".

We're in different times now, my man.

It is social mood that scares me, not the economy. Either way, I am not going to be hurt financially. I only have "play money" at risk. I could lose it all and not bat an eyelash - i wouldn't be happy about losing it. but it won't really hurt me (other than my ego!). My "serious" money is invested in my business, my real estate, and in cash. This is just for fun. It's kinda like my version of a "vegas" trip.....

Well the social mood kind of goes hand in hand with the economy. The economy sucks, so the mood is dismal.

But shrugging off your losses because you don't care about the money doesn't really help anything.

I'm just saying that these days, you need to widen your viewpoint on things because it doesn't seem like the same old market anymore.

The Federal Reserve is fucking nuts. They and the banks are playing some serious games with this market. Don't let them beat you at their game.

Good points.
Raw land at existing prices near a growing suburbia is a great buy these days if you can afford to sit and wait with no revenue on it. 40 cents on the dollar versus 5 years ago.
Municipal bonds, sit on them but be very careful how long. Many an IOU coming from some governments.
Utilities are an if buy but there are some good buys.
COH for the rest and 50%+ at that!

 

[rdking647]

I have been in cash for the last year with no regrets. Now I think the topping process is done and we are set for a major decline in stock prices.

Today I bought shares of ProShares UltraShort S&P 500 ETF at $28.08.

Best of luck!

why buy the etf when you can just buy spy puts. instead of 100 shares at 28.08 which costs 2800 you can buy 1 spy at the money put expiring in december for 350 or so. if the market has the big crash before the third week of december your golden.

 

[rdking647]

Lots of negative divergences. But that often happens in melt-ups. I am wondering if I should reestablish my long gold and silver positions. Silver hit a multiple-decade high today. Gold may have also put in a bottom.

instead of buying silver i but SLW stock. They basically agree to buy an entire mines production at $4 an ounce or so and get to sell it at the market.

 

[Toro]

I know of Silver Wheaton. Good company.

I've been buying back gold and silver, and will add to my position if they fall back into support.

Market looked tired today. Acted like it was topping.