First off – thanks for all the kind words on yesterday’s post. Very invigorating.
OK – now to today…
I can’t get this song out of my head tonight:
I woke up at 3 am this morning just knowing today was big. I had my lists, I was already long on this trade too early and I wanted to do two things, get my average prices down on my favorite stocks and not get upside down and panicked intraday. That’s all I thought could be accomplished today.
I decided early to use SSO (double secret sauce probation leverage S&P ETF) for a long play into the inevitable crashiness. The only new stock I was eyeing was RIMM.
All in all, I stuck to my plan and brought down my average prices in Apple, Amazon, Google, Visa and Amex. Russia is a clusterfuck and am just buried down 30 percent. I have to figure out how to trade out of that but that is for tomorrow and with Gold I was a net seller.
I will do the same tomorrow.
One thing I have learned is that I am being too transparent and that’s not good for you or me. Too noisy and not helpful so I will not be twittering my trades as much. I will use more links to get across how I come to my decisions instead of stressing people out, including myself. I apologize, but I am learning to use the new tools like everyone else.
So funny, But Andy Monfried, my good friend and Lotame founder who has been following the dumb pace of my ‘tweets’ sent me this email:
I own Venture Vixen’s (my wife’s) new blog;
www.whattodowhenyouaremarriedtoacrazyfrigginnutwhoismentalandlivesanddiesbymarketfluctationsandiswildlyemotionalandineedabreakfromitallbyellenfromarizona.com
Point taken Andy.
As to today’s markets,not much was really settled. We are crashing. It is not over. It is an event of major financial proportions for many reasons. The big one is leverage unwinding and the second is that so many people were late to realize how bad it was. That leads to this insane volatility.
I am looking for signs. I NEVER have the television on when looking for signs. I like quiet and I like to see lot’s of prices. I want to be in contact with the people I trust the most. Lately that has been the community on Twitter and StockTwits.
There were lot’s of signs today:
In less than one day of trading, the DOW fell over 1200 points at one point. I won’t sell into that. Not when I am so well positioned in cash. Never. I stand by all the decisions I have made the last week, even if some were wrong.
I am with JD Stein on twitter on these thoughts:
You can’t manage money based on worst case depression like scenarios or you’d always be in cash. Contrarian means looking stupid at times.
AND:
2 years ago the market was priced to perfection. Now it is the opposite. Priced for global failure.
The VIX is in unprecedented territory. It’s not an ‘all clear’ sign though.
Trader Mike’s great charting is showing more signs of a panic bottom forming.
I hear Cramer was on Today Show saying get all your money out of stocks if you need it in the next five years. OY. He forgets that people listen to him and I think it was irresponsible if that’s what he said. I have not seen it nor care too, but I know he was pounding the TABLE in JULY that we had bottomed.
In that vein, my friend Bill over at TheStreet with a much better sense of humor and timing, chimed in on this email with me today:
We’re all hunkering down for the depression
I am scared and was backpedalling for a bit at precisely the wrong time today. It was probably after reading this link from the NY Times .
Russia is now the devil and PUTIN is evil. Was Putin not just Time freaking man of the Year (a subject I have harped on for a while). Now all I read about is AIDS, Tuberculosis, crime, poverty, and all the same stuff that was going on six months ago when Russia was at all-time highs and PUTUN was king. Now Russia is down 70 percent and they suck balls. Hmmmmm…
The biggest signs though remain these:
The credit markets remain locked up.
Millions of American 401k’s are liquified.
We have ZERO leadership of our financial sytem. I mean it was deathly quiet today while the market tanked 900 or so points. I was not hearing anything constructive being planned.
The sellers are tired, but not exhausted and the buyers are scared. BUT the consumer is truly tapped and miserable. That’s what drives this hapless economy of the last 20 years and we have lost it for real this time.
Those are the signs. It’s not the end of the world, which is why I was buying, but it ain’t pretty and it’s why I am still only 20 percent invested after today.
The small hedge funds and even the big ones can get invested fast with the advent of triple leveraged ETF’s and hedged even faster, so there needs to be some real reasons for people to buy stocks.
One real reason would be if the leaders of our best frannchises were in buying stocks in size today. They were not. they were quiet. Why should I step up than? More importantly, why should you?
PS – Here is Jim Cramer’s BUY BUY BUY, Bear Market is Over Bottom Call on July 31. We just don’t need the buy of the century and crazy noise masked as entertainment if we are going to truly have a new bull market. This stuff is nonsense and Jim is way too smart.