The Credit Crisis Financial Stocks Short Journal

Bill Gross just hit the ball out of the park with his latest letter
http://www.pimco.com/LeftNav/Featur...2009+Staying+Rich+in+the+New+Normal+Gross.htm

Buffett must be smoking green shoots, yes the US has been a great place for the last 200 years but you had an underlying deterioration over those centuries.

Goverment spending has rising dramatically as a % of GDP, so has taxes, so has the disrespect for the constitution and the rule of law.

Basically the three elements he cites as reasons of the US success: Meritocracy(crack down on bonuses and compesation, obama wage controls, income redistribution coming), rule of law(disrepect for the constitution seems to be in a bull market, otherwise government wouldn't have grown to 35-45% of GDP, ex: the FCC is an anti free speech agency, its budget should be zero, yet it exists and operates), market economy(gov spending as a % of GDP has risen, so has taxes and regulation, therefore the market controls less of the share of output)

The truth is the US empire seems to be coming to an end, its simply not a great place to do business anymore. Perhaps the macro implication here is that Asia is the way of the future(with some exceptions), they can take advantage of the US ability to create new technologies that enhance productivity(by just flat out copying it, ex: internet) and they dont suffer the legacy problems of a bloated government and a likely fiscal crisis
 
You've got a bad case of confirmation bias. There is nothing in Gross' piece that hasn't been more or less conventional wisdom for months now.

Jobs report will be minus 500K and the market will be up 2% minimum today.
 
The fact that the Robin Soderling reached Roland Garros finals just goes to show how markets are blind to black swans. The swede was a 1000-1 dog in the beginning, I wish I had the discipline to keep betting on 1000-1 dogs every grand slam, its probably a swingy but a possible way to make money.

The fools love to chase the odds of the winners(Like niederhoffer), even the pessimists like me have a hard time to keep betting and losing small everyday, but its right thing to do, one day and you get all the money back plus many times over
 
Quote from ralph00:


Jobs report will be minus 500K and the market will be up 2% minimum today.
More...

Report was sub 400k yet market finished in the red, green overdose? Hmm, it reminds me of Nov 20 or so when a horrible jobs report lead to a market rally that didnt stop till Jan.

The report was broken down by rosenberg btw, birth death thing added 220K, ADP showed a 500K+ and household survery point to a 430K loss, net the birth death fantasy you get the about 550K the markets were looking for. The internals looked pretty bad in the surface(hours worked dropping and all), rosenberg broke that down, its ridiculous, anyone who thinks this report was good should became OJ's laywer

I'm willing to change my mind here but it just doesnt add up, in fact I'm looking to add to Oct Nov fed funds futures here I just need to decide if I'm going in, in substantial size
 
LOL. Stocks were up like 3.5% or something this week, and you're crowing about a little buy the rumor sell the news action.

The DJIA is going to challenge 10K before this rally is over. Rosie will still have a job pontificating. Our job is to make sure we still have funds in our account.

Its just a normal stock market right now. Will there be nice bear moves to catch this year ... of course there will. Anyone hoping for a return to the panic of parts of 08 and winter 09 is going to be disappointed. Trade this market like any other in which the Fed is in an easing cycle (upward bias).
 
Quote from ralph00:


The DJIA is going to challenge 10K before this rally is over
More...

Are you 2010 short ES puts with your own money?I'd guess no, you probably are long a bunch of stuff and is hiding behind a trailing stop. Lay odds without a stop then I will respect your opinion otherwise your just being the resident Gartman, as soon as the next dump happens you will be running for cover 'all of the sudden' will start to agree with bearish posts, say recovery will be weak and greenshooters are idiots
 
Well the TARP payback hype is set for this week.

All thanks to sucker mutual funds doubling down on banks via secondaries, after a 100% run up in the sector.

They really know how to manage $ don't they?:D
 
I speculated early in the year that the fed would either suceed and create high inflation or they would fail and deflation would prevail, I was highly skepctical of any sort of 'soft landing' that bernanke is promising. Looks like Taleb is betting on the same thing
http://www.ritholtz.com/blog/2009/06/can-the-fed-execute-a-perfect-landing/

I'm curious how he is structuring this trade, he said something about volalitily of macro variables, maybe he is betting on a persistently high vix?
 
Quote from Cdntrader:

Well the TARP payback hype is set for this week.

All thanks to sucker mutual funds doubling down on banks via secondaries, after a 100% run up in the sector.

They really know how to manage $ don't they?:D
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Frankly I'm going to cover some shorts and swap for some Fed funds futures here(its almost the same trade), they tumbled friday after the employment report. Maybe I'm wrong but it seems to me that fed policy will stay at 0.25% till employment starts to grow significantly and that will take a while. The trick is choosing the right month in the contract(the one with the best risk/reward), that is quite difficult

I'm covering GS and maybe something else, so anyone who wants free money, short goldman sachs, now that I'm out you can bet this thing is going straight to $70
 
Quote from Daal:

Are you 2010 short ES puts with your own money?I'd guess no, you probably are long a bunch of stuff and is hiding behind a trailing stop. Lay odds without a stop then I will respect your opinion otherwise your just being the resident Gartman, as soon as the next dump happens you will be running for cover 'all of the sudden' will start to agree with bearish posts, say recovery will be weak and greenshooters are idiots
More...

I'll say it right now ... recovery will be weak and greenshooters are idiots. As I've said before on this thread, I mostly agree w/yoy regarding these macro issues. That doesn't mean we're going back to conditions of last fall and winter EVER AGAIN. That was a once in a lifetime thing. If you missed or played GBP/JPY going from 200 to 120 in a space of a few months, or COF (to name one crap fin'l) going from 34 to 8 over several weeks, you're not getting that chance again.

What we have now is a normal market. Equities will go up and they will go down. Currencies will fluctuate. Straight lines are done with, execpt for the straight line up in stocks over the last 3 months. When you miss a 40% move in equities over 12 weeks, a hundred plus basis point move in bonds, or a 40 handle move in GBP/JPY, you aren't early, you're wrong. Rosie, Roubini, Whtney weren't early, they were wrong. Trade accordingly.
 
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