I Am In 25% Cash! All Accounts*

SiSe-

There are some islands off the coast of Nicaragua and Argentina and Brazil where you can get the whole set up beach, house, land for $300K.

Africa is not out of the question for me someday great islands there too.

But my heart is in Barcelona, Seville & Sintra, Portugal unfortunately.

For now rooted in NYC by a Rhodesian Ridgeback who won't crate or fly... I'm trying to make enough $ for one of those partial shares on a small plane but I'm scared shitless of small planes and I don't even know if they allow a dog in the seat next to you. Oh yes and I have a three year old! Education must play a roll here too... In the caribbean there are some places where you can live cheaply and enjoy the tax benefits I have always longed for by being offshore. Perhaps I shall retire to Nevis or Mustique before too long if I can figure out a school for my boy. It's all so overwhelming and confusing but i can tell you this here in NYC some things are getting a lot better but it's primarily for tourists now and in the summer there are so many of them it makes me sick. They clog up my restaurants and theaters and museums and make me not want to live her at all. That's why i take every July & August off from the city and investing. I don't really care if it takes a couple percentage points off my year- I simply must recharge next to an ocean laying down absorbing those vitamin K rays. This is what I wait the whole year for..., i only come alive in some ways in this period we are in now,... after taxes on both my store and me I see what $'s are left and get my summer house together at Fire Island. Year after year the cycle continues. But if everything i have worked for and inherited over the years is worth 60% less than it should be open the world market who do i blame? It's not my fault.

here's a scary story a Real Estate guy I know was telling me of the swaths of apartments being gobbled up by The Irish! Of all people yes not japan, Not Dubai, but Ireland which has been motoring along prosperously they have spawned some rich guys and lasses who come over here and buy not just one apartment in one of these overpriced eyesores of metal going up downtown on the west side but two ENTIRE FLOORS 20 plus apartments for investments! The Irish money being 30%-60% stronger than it should be. If this continues and other euro block countries get in on the feeding frenzy what will be left of America?
 
Ok I had my first pain in the gut yesterday about being in so much cash. One of my stocks I sold OSIS had a huge day. This could continue and make me mucho unhappy-- I found myself mucking up my trading account buying AND selling trying to maintain cash while staying up with the markets return. I'm placing bigger bets on fewer stocks.

Keeping me sane is the parallels we are know seeing in todays market as compared to past crashes. There is an amazing similarity between the last month or so of the rise in Japan that ended on Dec. 29, 1989, and the current advance in the Dow Jones Industrial Average ($INDU) (through April 27): Specifically, the last 32 out of 38 trading days in Tokyo were on the upside, with an initial run with a higher close on 19 out of 21 days, followed by seven out of 11, followed by six for six before about a 40% drop in the course of nine months took place. Recently, from the lows of March 5, the Dow closed higher in four out of six sessions, followed by seven out of 11, followed by 20 out of 22 -- for a grand total of 31 out of 39 days.

32 out of 38 = Japan mania over
31 out of 39 = 1 more day for US market?

Also the last time the Dow had a run of 19 out of 21 days was in July 1929 -- not exactly a great time to buy stocks. What's kind of annoying is the overall return has been so much less here than in any of the prior examples that we don't have 400% cushion to fall back upon one good 10% drop and where are we? A Year of Going Nowhere Fast.
 
Well my little math game was dead on I guess. Here we are folks. Your 4% correction is here.
Things changed today and not for the reason you may think. Yes, stonedinvesting with one foot in the retail world, knew in advance that these numbers would be much worse than expected. We were counting on that fact/ But a seemingly innocuous set of economic numbers came out that did the usual oh we're right about everything but the pick up is going to come just a little bit later routine- maybe now not till the 4th qtr. The moving yardstick game is as old as Moses... these reckless bulls all smiley faced yesterday are now going to say " this is good " "we need this" " the Market has been up to much". "This is normal". . Why didn't you say that yesterday?> The way we did. Gutless creeps/ They make me crazy, these mutual fund managers, these lascivious grease stained money mongers leading the common man astray.... Anyway, most have no cash right now. Everyone is fully invested and assuming new cash will come rolling in and that's when they'll do their buying on the dips. DANGER ALERT* This coincides with a consumer draw in... normal money flows have been altered in the retail world, the housing world and next the stock world.
What if those new funds sopped up by tax payments don't roll in? With no cash on hand anywhere who will buy these dips in size you and me? Be careful folks.

Should China tip here as well... then all bets are off. That's not going to happen I don't think. This should be a standard 4% but the problem is... going back to the goal post analogy investors have to be in the mood for that shit. And I can tell you from my phone calls... I don't think they are. Perhaps it's time to WAKE UP and realize a recession is a VERY real possibility. Will the Fed cut into a roaring market? No. The market will self correct in a scary way and that will allow the Fed to get up off his seat and cut. that's how I see it - with the scary part coming in Sept. ~ stoney
 
Sir Stoney, I haven't heard your take on the massive amount of money looking for a home via hedge funds, private equity funds etc.. There is a sea of cash looking to be put to work, risk-adjusted valuations be damned. Your thoughts and pontifications please........
 
Sponger I have struggled with this liquidity issue. Indeed when I explain my concerns to hedge fund types they seem to fall back on that endless amount of private equity financing available.

In deep thought mode the following has to happen for the REAL market break, a couple Private Equity funds take stocks private, inflate their debt and are UNABLE to bring them back to market. The Yen carry trade needs to die on the line.

On a personal note I have found myself staying in stocks and holding throughout longer periods on the " hope " of a magical buyout on any given Monday- the scared to hold the weekend crowd has completely reversed. That is dangerous. I don't like style changes that are dictated by others or hope.

The PE of this market will go up as earnings come down.

Taking silly Cramer as a barometer he had warned his minions to stay away from the market during the seasonally weak periods for tech. Then as he saw what an idiot he was he began sneaking tech names in under the guise of them being really " gadget " companies or
Internet advertising or some other vague relationship to tech. As soon as he got them in. The rug came out.

America's assets, art, real estate are being gobbled up by outsiders with stronger currency
Too much $'s will go there. As for our stocks, the constant buyback and shrinking of shares has the effect of a Ponzi scheme, the total lack of investment in the future worries me greatly.

Our Last Chance for this market will be when MSFT releases the Patch to the first version of Vista- at that time we may see the unfolding of a new round of spending by businesses... I will be looking for that moment very carefully. Until we get there we have something very close to a recession staring us in the face.

The consumer is stretched to the point of coming undone. Quite frankly now for our markets it's a race to see which happens first the next down leg to the housing market....
or the beginning of corporate spending... It's a tight fit but I'm betting on pullback now, strong rally and Sept meltdown, Oct rate ease scenario.

And all that pretty much functions on it's own- so unless you have an inside line at this point on a takeover I wouldn't count on the entire market celebrating a takeover of Alltel or some such company any more. ~ stoney
 
The most fucked up thing is that while companies should have been taking on debt only to grow their companies or make sensible buyouts, instead they were buying back shares with cheap debt to improve their standings with investors! Genius. :D
 
Thanks Stoney - BTW, your posts analyzing the markets are some of the most interesting ones to read on ET - keep 'em coming!
 
The post-FOMC announcement session (yesterday) is very often a reversal day, and that will signal the TRUE trend. In fact, on several occasions the FOMC announcement ended up marking a short-term TOP.

Stepping back and reviewing the hourly chart patterns, a key break occurred yesterday. Short-term support was taken out as well as the sharply rising trendlines of the last six weeks. So a key negative day for sure. Short-term support is below the current levels at around 1858-60 on the NDX and 1475-78 on the S&P.

After almost two months with no downside follow through, Thursday we saw some action that can be considered downside follow through. But one day does not make a trend. We need at least two down days for that to happen. But what I have been warning investors about was the small overall scale of the gains-- This stage of the bull market has brought us a lousy 30% while past bull market spurts have returned 200% or more! So with one down day, the gains from two weeks have been given back! Pro-rate this out and we could have one good correction and (gasp) be flat on the year!
This is the first time in a while where the S&P moved lower, bounced, & then TOOK OUT the early low. not good. Since the first of April every round of selling has quickly been met with buying. This time, the buying failed to develop. When the NASD reached 2555 it tried to hold, but the downside momentum was overwhelming. All the indices gave daily sell signals. The NYSE and NASD gave the most valid signals because they did not make higher highs on Wednesday. With lower daily highs and daily sell signals, we have the definition of a down trend.
This is considered more reliable than the straight down move of the Dow and several other indices. The rest of the 3-day trends will turn down if we see virtually any weakness Friday. So a strong start today and a fade would be problematic.
Undoubtedly next week this week's lows will be broken. The current weekly trend configuration argues against the sort of rapid rebound we have grown so accustomed to over the past two months folks!. This is going to be long and slow I believe- as many were able to get puts on the market yesterday around 11:00 they surely will not be instantly rewarded- the market will surge getting them to cover and then roll over. Thursday was more than a down day. It was a huge down day and we saw notable changes in the way traders reacted to prices moving lower. This bares careful watching. ~ stoney

PS* The one bright spot is that turnover was mixed. Total volume in the Nasdaq rose 7%, causing the index to register a bearish "distribution day," but volume in the NYSE actually came in 2% lighter than the previous day's level!! >*This indicates that institutional investors were not aggressively dumping shares in the S&P and Dow. That COULD still happen... Nevertheless, market internals were ugly! In both exchanges, declining volume exceeded advancing volume by a ratio of approximately 7 to 1. Of the "big 3" stock market indexes, only the Nasdaq closed below both support of its uptrend line from the March low and its 20-day exponential moving average. Because they were riding along the top of their uptrending channels, both the S&P and Dow conversely remain above support of their uptrends. Unlike the S&P and Dow, the Nasdaq broke support of its primary uptrend, as well as its 20-day EMA. However, a one-day probe below key support levels is never enough to confirm a reversal. In a strong market, stocks and indexes frequently dip below closely-watched support levels for a day or two, only to snap back after the "weak hands" have been shaken out at the lows. Clearly, the technical picture of the Nasdaq is worse than that of the S&P and Dow, but not yet negative enough to declare an end of the intermediate-term uptrend. This, of course, could rapidly change if losses multiply over the next several sessions. Finally, keep a close eye on the performance of small and mid-cap stocks, which have lagged their large cap peers in recent months. If they begin to fall apart, which they are, it will undoubtedly weigh on the broad market.
 
Well. You guys are going to live through me.
I've never gone short the market before in 20 years investing. I'm a long & strong guy it just seems wrong to bet against stocks other people are pulling for. I've used this QID thing god help me. My feeling is: I'm just nervous and either my antennas are working or they aren't. It makes me scared that my professional handlers don't see it this way and all the more pressure on me going out on a limb (it was bads enough on ET!) So I've bought $40,000 worth against an index I guess the Naz. It's a general short no specific axes to grind and is really there just for me to sleep well this weekend.

I'll let you know how this experiment in growing balls turns out. I've often been jealous of good short sellers- the level headed ones- and I hope I'm being that. I could puke right now. My poor wife is in for a tough day. I leave you and the market now and won't tune back in till 4:00 I'm hoping for a good fade.
 
Quote from stonedinvestor:

Well. You guys are going to live through me.
I've never gone short the market before in 20 years investing. I'm a long & strong guy it just seems wrong to bet against stocks other people are pulling for. I've used this QID thing god help me. My feeling is: I'm just nervous and either my antennas are working or they aren't. It makes me scared that my professional handlers don't see it this way and all the more pressure on me going out on a limb (it was bads enough on ET!) So I've bought $40,000 worth against an index I guess the Naz. It's a general short no specific axes to grind and is really there just for me to sleep well this weekend.

I'll let you know how this experiment in growing balls turns out. I've often been jealous of good short sellers- the level headed ones- and I hope I'm being that. I could puke right now. My poor wife is in for a tough day. I leave you and the market now and won't tune back in till 4:00 I'm hoping for a good fade.
More...

can't stomach the ride? Just don't be the one holding the pan when the egg omlette hits the floor bro. Sit it out until you get two consecutive daily down bars (negative) 50-80 each on the major indices.
 
You must log in or register to reply here.
Back
Top