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Distribution And Rotation, aka Sell Off

Tyler Durden's picture




 

The sectors that brought us to the ridiculous highs are getting sold off. The financial sector now faces a choice between offering a sacrificial lamb or becoming a regulated utility. We hope it opts for the first (we have  a few candidates in mind), as the latter will likely lead to the prompt realization that we never really emerged from the great depression v2. Goldman once again reminded everyone today who is still in charge. As for tech, say good bye to the stimulus wave. In fact, Q1 GDP will be merely the next point on a declining curve. Unless a new stimulus is instituted promptly, this is now the middle of the W. The same for the artificial and one-time bounce in GDP as we have been saying since April of 2009. The bears, for the first time in 13 months are finally smelling blood. And we have a weekend chock full of catalysts, number one and two being the Greek bailout and the resultant civil war, and Lloyd Blankfein on Charlie Rose, digging himself into an even deeper hole. The best damage control for the squid right now is silence. Pity that stooping to the level of the morts has always been the mollusc's weakest side, and soon to be its undoing. Also add to that the Bund short-end screaming tighter, and the surge in the dollar, as in the sudden and dramatic evaporation of all carry trades, and you have set the stage for the Lehman unwind. Next week will be fun.

 

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Fri, 04/30/2010 - 16:58 | 326072 Bear
Bear's picture

GS ... Silence is golden and the best defense is a good defense.

Will we break the Meltup Monday curse? Lets vote.

Fri, 04/30/2010 - 17:26 | 326190 Implicit simplicit
Implicit simplicit's picture

The water was broken last Monday, so the waterfall may continue.

Fri, 04/30/2010 - 17:38 | 326206 B9K9
B9K9's picture

First of all, welcome to the fold Tyler Durden X.0. I see you're following the ZH style guidelines quite nicely, but a few interesting quirks made it into some of your sentence structures to give it a more 'personal' touch.

Secondly, the market is not quite to the point of finally resuming its previously scheduled immolation that was so rudely interrupted back in March '09.

The reason for this is simple - the futility of the various stimulus programs, in conjunction with the so-called "failure" (so called because it was never intended to be effective; rather it is only a salve for the dupes) of monetary policy and Keynesian theory, is not yet accepted by the general public as conventional wisdom.

Now, why is this? It's because the "we've been had + they're all a bunch of crooks" meme hasn't yet been green-lighted for wide distribution by the MSM. Ok, why is that? Because preparations for the final parabolic blow-off haven't yet been completed. IOW, the self-same owners of the MSM are also the engineers behind the public debt saturation and they haven't yet finalized all their short positions.

Look, guys and gals, it's really quite easy - anyone can perform their own open source intelligence. When you see any of the teleprompter readers on CBS, NBC or ABC begin to address the topics regularly discussed @ ZH to all the clueless sheep out there in La-La Land, it will be time to enter the final chapter.

Until that point, it's just a lot of yo-yoing back & forth to generate some short-term trading income. The big short is still being loaded.

Fri, 04/30/2010 - 18:02 | 326240 SamuelMaverick
SamuelMaverick's picture

Gotta luv the criminal pump and dump. Watch out, it is almost time to shear the sheep. I am waiting patiently for the MSM to start sounding a little like zereohedge.

Sat, 05/01/2010 - 04:28 | 326740 Mick C Pitlick
Mick C Pitlick's picture

Well put. I often think, "Isn't it astounding, when you read (or watch) the daily news, there is not an inkling of notice that the debt bomb will soon explode with the power of a 1000 suns".

Fri, 04/30/2010 - 16:34 | 326084 Dr Hackenbush
Dr Hackenbush's picture

Indictment of GS and market tanks in very methodical fashion.

"President Obama, are you listening...(?)"

Fri, 04/30/2010 - 18:14 | 326259 Rainman
Rainman's picture

...haha. I was thinking the same thing, Doc. That talk of criminal stuff makes the soon-to-be inmates kind of nervous out there.

Speaking through the market is the best way to scare Ob and the Critters. Worked fine a year ago to get Stim I and FASB 157 as I recall.

Sat, 05/01/2010 - 02:05 | 326678 AccreditedEYE
AccreditedEYE's picture

But aren't they out of ammo Rainman? Who the heck is gonna buy the debt for stim II? As Tyler points out, our (U.S.) balls are in a vice with the weekly roll. Debt destruction (default) is primed to occur in Europe and everyone has to see we can't escape it either. There just ain't enough money this time, no?

Fri, 04/30/2010 - 16:37 | 326089 Greater Fool
Greater Fool's picture

Seems like a bit of methodical equity tanking would be just about right, and more than a little overdue.

Fri, 04/30/2010 - 16:55 | 326130 Dr Hackenbush
Dr Hackenbush's picture

Sell off?  That's not part of the arrangement.

Fri, 04/30/2010 - 16:41 | 326098 Howard_Beale
Howard_Beale's picture

 

I am doing a fundraiser for ZH approved by Tyler and have new items in the Zazzle store today. Just go to www.zazzle.com/Howard_Beale or click on the links below. Up today--Ben at the printing press. Some new people on mugs behind bars--Lloyd and Hank. Spread the word. Everything is customizable and going to a good cause!

http://www.zazzle.com/ben_at_the_printing_press_tshirt-235406132570361739 

http://www.zazzle.com/ben_bernanke_at_the_printing_press_mug-168793263404831227 

http://www.zazzle.com/hank_paulson_behind_bars_mug-168896054702088478 

http://www.zazzle.com/lloyd_blankfein_behind_bars_mug-168451652960123716 h

ttp://www.zazzle.com/ben_at_the_printing_press_tshirt-235339445432586904  

http://www.zazzle.com/ben_at_the_printing_press_mug-168921577105737484

Thanks everyone! Continue to send me ideas at the Zazzle store contact and I will do all I can to make them. If you want to submit graphics, send em in! We fully intend to make the women of ZH Calendar for 2011.

Fri, 04/30/2010 - 19:11 | 326344 Miss Expectations
Miss Expectations's picture

Hello Howard,

How about a ZH logo (just the ZH not the words) like the GB bumper stickers:

http://images.search.yahoo.com/images/view?back=http%3A%2F%2Fimages.sear...

Fri, 04/30/2010 - 19:25 | 326361 Lothar the Rott...
Lothar the Rottweiler's picture

I would proudly sport the ZH logo on my ample behind... I mean car bumper.  How sweet would that be?  Alas, can you make bumper stickers at Zazzle?

Also, is this women of ZH calendar going to be their avatars?  Lizzy36, you need an upgrade if that's the case.  No cartoon characters for Lothar! :-)

Fri, 04/30/2010 - 19:52 | 326391 Cheeky Bastard
Cheeky Bastard's picture

put a pic of Bernanke with "Reality is for Losers" written underneath it.

Sat, 05/01/2010 - 02:40 | 326691 AccreditedEYE
AccreditedEYE's picture

+1 trillion LOL

Sat, 05/01/2010 - 19:31 | 327345 WaterWings
WaterWings's picture

Hehehehehe.

Fri, 04/30/2010 - 21:48 | 326489 feeb
feeb's picture

Howard Beale! Just wanted to say that I made my first zazzle purchase ever yesterday - one of your tees and one by the Liberty group on zazzle - the print with Bernanke as 'Bankster'. Good work jumping in with this fundraising idea, it's going to a worthy cause.

 

 

Sat, 05/01/2010 - 01:03 | 326649 chindit13
chindit13's picture

Howard,

How about a "Just say NO to Incumbents", with a capitol picture and the international negative symbol (circle with the slash) on the back.  Just in time for election season.

Sat, 05/01/2010 - 01:38 | 326667 Lux Fiat
Lux Fiat's picture

A t-shirt with a chart of the USD's purchasing power since the early 20th century, with the caption "Hang on for the slide of your life!"...?

Fri, 04/30/2010 - 16:43 | 326103 hambone
hambone's picture

OK, who is short going into this weekend?  I initiated shorts days end yesterday and took my 7% w/ a smile today.  No faith that the next Charlie Brown / Lucy football swing and miss won't appear Sunday as the futures swing positive. 

Honestly, anybody carrying shorts into this?

Fri, 04/30/2010 - 17:05 | 326147 brooklynlou
brooklynlou's picture

Well, we'll find out on Monday. :-)

1 hour after close and 13.6 million shares of SPY were traded.

Either a lot of people are attempting to cover shorts or a whole lot of people think Monday is going to be a super-fantastic day.

Fri, 04/30/2010 - 17:12 | 326162 Implicit simplicit
Implicit simplicit's picture

Short since early March, but I'm a convicted bear. Don't believe in stops because I don't trust the makers. Don't believe in the market because its rigged. don't believe in the economy because it sucks. Basically, don't believe in anything the majority agree with, so I will continue to do the opposite until I"m right or my bet goes to zero, or I die. It makes me happy to have conviction, and I like my work so I'll work till I die. 

Fri, 04/30/2010 - 17:13 | 326169 nedwardkelly
nedwardkelly's picture

I bought SPY puts yesterday, then sold them today. I actually jumped the gun a bit and sold them early afternoon, assuming that we'd have another 'miraculous' recovery at the end of the day.

I also didn't want to mess with Monday. I figure the weekends give TPTB the chance to announce a bunch more bailout/dont worry be happy nonsense. If it's a typical melt up Monday, I'll buy more then.

Fri, 04/30/2010 - 20:32 | 326427 Cursive
Cursive's picture

Me.  Don't let anything rattle you.  But look out for a second wave bounce that could eat a lot of your initial profits.  Ride to reality probably started today.

Fri, 04/30/2010 - 16:47 | 326106 Pure Evil
Pure Evil's picture

Thank god its finally tanking. I was almost ready to drink another healthy dose of the kool-aid and join the 36,000 and beyond mantra and start dipping my big toe into the market.

Whew!

So, what now, should we all dive into the safety of Treasuries?

Fri, 04/30/2010 - 16:48 | 326112 Ned Zeppelin
Ned Zeppelin's picture

It's early in the game, still.  Watch the Monday ramp up.  If I were Goldman, I'd tell Lloyd to do a public mea culpa and resign. At least give the illusion that a long time institution operates according to some core values that have gone astray, and restore them.

Ain't saying it's true, just that would be the right move to save the firm.

Fri, 04/30/2010 - 16:49 | 326114 Steroid
Steroid's picture

Tyler,

You are still talking about W recovery. It should be called h or even h

“recovery”.

Fri, 04/30/2010 - 16:53 | 326124 Steroid
Steroid's picture

That second h should read as a greek small "eta".

Fri, 04/30/2010 - 17:35 | 326203 WaterWings
WaterWings's picture

It actually looks like chicken scratch at first but it's the Chinese symbol for:

All your bases are belong to us!

http://www.youtube.com/watch?v=qItugh-fFgg

Fri, 04/30/2010 - 16:51 | 326119 Salinger
Salinger's picture

OT

 

Oil spill rate  now 25,000 barrels per day (thats a millon gallons per day) 25 times more than BP's orignial estimate of 40,000 gallons per day

 

http://online.wsj.com/article/SB1000142405274870387190457521638216062349...

 

 

Fri, 04/30/2010 - 16:57 | 326134 RichardENixon
RichardENixon's picture

"Boy that's a real mess, huh?"

"Well if not it'll do till the real mess gets here"-No Country for Old Men

http://blog.al.com/live/2010/04/deepwater_horizon_secret_memo.html

 

Fri, 04/30/2010 - 17:00 | 326140 lizzy36
lizzy36's picture

Reuters Breaking News:Another drilling rig has overturned in inland waters near Morgan City, LA: Coast Guard.

Say good-bye to offshore drilling. 

From what i am hearing bp oil spill is going to be many multiples of exxon valdez.

Fri, 04/30/2010 - 17:10 | 326149 Salinger
Salinger's picture

Valdez was 11m gallons

This is according to WSJ 1m gallons per day and this is day ten

and they are talking months to get this capped

 

 

"  BP...  accused of playing down the scale of disaster after as it emerged that five times more oil was surging into the Gulf from the seabed than had been calculated previously." (now twenty-five times)

 

http://www.timesonline.co.uk/tol/news/world/us_and_americas/article71121...

Fri, 04/30/2010 - 17:13 | 326167 lizzy36
lizzy36's picture

i heard 6 to 9 ms b/f it is capped. 

3ms is the party line.

Fri, 04/30/2010 - 17:11 | 326159 kaiserhoff
kaiserhoff's picture

Anyone have a read on why the safety cut-offs failed?  Lots of yak, yak from the talking heads, almost no information.

Fri, 04/30/2010 - 18:32 | 326289 Amish Hacker
Amish Hacker's picture

Cameron manufactured the auto shut-off equipment, but the market seems to think they won't be found at fault. I say that because CAM got hammered yesterday, but has bounced back some. Halliburton was responsible for the cementing operation that likely precipitated the blast, and their shares are down about 10%. Transocean was operating the rig, so RIG is down twice that much over the past week. 

Fri, 04/30/2010 - 20:18 | 326409 Hulk
Hulk's picture

Just listened to one of the workers present at the time of the accident. He states that it was a massive overpressure of gas. Blew out all the safety systems. Gas pressure blew all the mud out of the pipe, then spilled onto the drilling rig deck and ignited. Mother nature wins again.

Fri, 04/30/2010 - 16:52 | 326121 Hondo
Hondo's picture

Why are we not looking at second order growth rates now......

Fri, 04/30/2010 - 20:39 | 326433 Cursive
Cursive's picture

This.

Fri, 04/30/2010 - 16:53 | 326126 Sniper
Sniper's picture

The S&P looks mighty toppy!

Fri, 04/30/2010 - 17:00 | 326138 Cistercian
Cistercian's picture

 The GS legal problem really tanked it today.If Darth blankfiend epic fails, not even the magic algos will be able to stave off epic liquidation of financial equities.I predict NYSE server "problems" Monday.

Fri, 04/30/2010 - 19:57 | 326395 tpberg7
tpberg7's picture

Cistercian,

This is a reasonable assumption and looks as good as any put forth so far.  I did short the Dow before the weekend.  I am willing to roll the dice on these bandits because I do not think they can control every possible move in this rigged market.  There are still some unforeseen conditions lurking in the shadows and waiting to pop out and nail these bastards.

Fri, 04/30/2010 - 23:11 | 326558 Cistercian
Cistercian's picture

 Yes.Not to mention that if real weakness is perceived at GS by the other wolves, there will be a feeding frenzy.GS is still very dangerous in my opinion..however, if a really stupid/incoherent/incriminating statement comes from LLoyd the Evil, GS may be in serious trouble next week.

 And you are right, there are so many other things just waiting to pop up.

 

 There may be a lesson here for our lessor gods on Wall st.When sovereigns feel that they have been ill used to the point of them going under, they may be able to call in resources unavailable even to the likes of GS.There is no telling what kind of knife fights are happening behind the curtain...or how that will effect the markets.

 

 I hope you do well, and good luck.You are braver than me!

Fri, 04/30/2010 - 17:05 | 326142 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Silver and gold deserve more than a one liner today. 

There is no spoon.

There is only the RE'AL.

Fri, 04/30/2010 - 17:02 | 326144 Internet Tough Guy
Internet Tough Guy's picture

You mean Harry Wanger won't be posting the same statement on every thread? Things are looking up.

Fri, 04/30/2010 - 18:40 | 326299 Mitchman
Mitchman's picture

Is that a leading or a lagging indicator?

Fri, 04/30/2010 - 17:03 | 326145 Assetman
Assetman's picture

Next week will be fun.

That all depends on what your definition of "fun" really is.

My definition of "fun" is watching the CNBS regulars sweating bullets.

To each his own...

 

Fri, 04/30/2010 - 17:52 | 326229 Mitchman
Mitchman's picture

Please

Fri, 04/30/2010 - 17:06 | 326150 kaiten
kaiten's picture

"...this is now the middle of the W"

 

HAHA, what a dreamer. How about VL?

Fri, 04/30/2010 - 17:08 | 326153 buzzsaw99
buzzsaw99's picture

More like WL___ recovery.

Fri, 04/30/2010 - 17:13 | 326165 kaiserhoff
kaiserhoff's picture

+10

The truth hurts.

Fri, 04/30/2010 - 17:16 | 326154 Cyan Lite
Cyan Lite's picture

Com'on guys.  We have the first down week since January and now everybody all of a sudden bearish?  Nothing more than consolidation this week.  The dip can now be bought on Monday.

This week was all about scaring people into Treasuries to meet auction demand.  That's all, because I think we all know Fabrice Tourre will get thrown under the bus and be the sacrificial lamb for Goldman (we'll probably see him next running the SEC Enforcement Division).  Goldman can then talk about this "rogue trader" and say they have cleaned house.

Fundamentals really haven't changed.  Prop shops still have access to 0% financing for bidding equities higher, earnings were half-decent.  Fed has kept the "for an extended period" phrase (read: ZIRP tomorrow, ZIRP forever).  GDP was half-decent enough to make good headlines for the nightly news but low enough to contain inflation.

 

The Big Elephant In The Room is the 61.8% Fib retracement from 2007.  If we get past that, we're headed to 1575 on the S&P 500!  I'm not a buyer at these levels until we break 1250 decisively, but until then, I'm selling upside $125 calls on the SPY and downside puts ($117 strikes and lower), essentially an iron condor.  Also buying VIX puts on every spike.

Fri, 04/30/2010 - 18:19 | 326211 abalone
abalone's picture

Cyan do you & Harry share the same dentist?  As those are also some impeccable teeth ...by the way your market calls up until now have been exceptional

Fri, 04/30/2010 - 17:42 | 326214 Implicit simplicit
Implicit simplicit's picture

Fundamentals haven't changed. They still suck. Prop shops don't care if it goes up or down. They just care about making money. they can make more quicker on the downside right now.

Goldman wants stocks to go down.It makes it look like the stock market doesn't like what is happenning to them, and it takes the focus off of them. In fact they could be a prop desk that will help it go down. They have been known to short.

 Fib. #s work well on the downside too. The Vix puts might work for a day or two, but it is showing a reversal pattern.

Sat, 05/01/2010 - 02:49 | 326697 AccreditedEYE
AccreditedEYE's picture

Cyan, you regret selling those S&P puts early? :)  You are right though.. VIX still maintains the downtrend... and ZIRP is still in effect. I lean WAY short but I always worry what the algo crew will do to F me up.... Johnny Bravo probably had a fun day today. LOL

Fri, 04/30/2010 - 17:09 | 326156 lizzy36
lizzy36's picture

A Friday Funny brought to you by the WSJ blog - had to go to WSJ for this as hopefully TD is either asleep or enjoying all his present location has to offer.

Larry fat fuck Summers, left absent his words.  First Goldman, then Summers.....good Friday all!

April 30, 2010, 4:14 PM ET

Larry Summers Left Speechless

Larry Summers, the president’s economic adviser, and Mike Bloomberg, the mayor of New York, shared a stage in Washington Friday. Although they agreed on most things, Summers was quick to swat down Bloomberg’s suggestions that disclosure — as opposed to more muscular regulation, particularly of financial offerings to consumers — could cure much of what is wrong with the financial sector.

Whenever something happens, Summers said, Plan A is form a committee. Plan B is to encourage industry to voluntarily devise better practices. Plan C is to call for more transparency. And then, eventually, Plan D is “do something.”

The audience, convened by the Hamilton Project and Center for American Progress, laughed.Then moderator Charlie Rose, the TV talk show host, intervened: Is that how you’d describe the president’s commission to ponder the federal budget deficit?

Summers was, uncharacteristically, speechless.

Fri, 04/30/2010 - 17:26 | 326187 Ruth
Ruth's picture

Superb, Lizzy! 

Fri, 04/30/2010 - 21:07 | 326453 Miles Kendig
Miles Kendig's picture

Agreed Ruth.  Lizzy always finds great links for all of us and this is no exception.

Fri, 04/30/2010 - 17:44 | 326207 WaterWings
WaterWings's picture

Most. Transparent. Administration. Evar!

Shut up, racist!

(not you Lizzy :-))

Obama and the media actually have a surprisingly hostile relationship — as contentious on a day-to-day basis as any between press and president in the past decade, reporters who cover the White House say.

 

...

 

The ferocity of pushback is intense. A routine press query can draw a string of vitriolic e-mails. A negative story can draw a profane high-decibel phone call or worse. Some reporters feel like they’ve been frozen out after crossing the White House.

 

http://dyn.politico.com/printstory.cfm?uuid=42A9C609-18FE-70B2-A84A2D8F7...

Fri, 04/30/2010 - 20:30 | 326420 Miles Kendig
Miles Kendig's picture

I had a vision of Larry dressed up in drag and he looked like Ethel Merman in It's a Mad, Mad, Mad, Mad World... The amazing thing is that this altar ego for Larry is never short of words.  Perhaps when he gets reconstructed from his current state of speechlessness folks will remember him as the endless nag with the propensity to finger wag.

Larry at the conference.  Start at the four minute mark.

http://www.youtube.com/watch?v=eh3ozSG9egc

Fri, 04/30/2010 - 17:15 | 326170 lbrecken
lbrecken's picture

harry where are you?

Fri, 04/30/2010 - 17:22 | 326184 glenlloyd
glenlloyd's picture

I was gonna say the same thing...

Fri, 04/30/2010 - 17:41 | 326213 WaterWings
WaterWings's picture

If only we could put a blog tracking device on him.

Doo..doo..doo..doodoo..doodoodoodoodooooooooo.

He's probably up over at HuffPo humping up his badges in the comment section.

Fri, 04/30/2010 - 17:49 | 326225 Mitchman
Mitchman's picture

He does appear to be strangely silent, doesn't he?  I'm sure he's going to be watching for that opening uptick in the Asian markets Sunday night Eastern time to cheer us all up on Monday morning.

Fri, 04/30/2010 - 17:57 | 326233 HarryWanger
HarryWanger's picture

You're dreaming if you think Monday will be a down day. That seems to kill the bears every time - a fairly decent down day and suddenly it's lights out. Only then, it comes right back and kicks you in the ass.

Monday we will have a Greek "resolution" that the markets, for some reason, are waiting for. We'll get Blankfein and the media to tell us there really is no "criminal" investigation. 

Monday is a gimme. We're holding support well. I'd love to see a dip to max pain 1075 then buy with both fists.

Fri, 04/30/2010 - 18:27 | 326278 Rainman
Rainman's picture

....guess where I'd like to put both of my fists.

Fri, 04/30/2010 - 18:42 | 326301 Mitchman
Mitchman's picture

Harry,  these poor people are trying to trade and make some money and instead you have them worrying about which of the Ten Commandments they want to break in relation to you on a day-to-day basis!

Fri, 04/30/2010 - 19:05 | 326336 Implicit simplicit
Implicit simplicit's picture

Be careful, the water was broken last Monday. This Monday will be the waterfall. I hope your not on margin because you will be  getting a call, which will only help the bear cause.

Did u mean Greek revolution?

Fri, 04/30/2010 - 20:06 | 326398 Cheeky Bastard
Cheeky Bastard's picture

I hope someone beats the shit out of you with a full set of billiard balls wrapped in a towel.

And then rape you after that.

And the embarrassment gets to you, you know psychologically, and you lose all your money and you are forced to suck strange men cock for money and cheeseburgers in the back allies behind strange Turkish bath houses .

Money you will use to settle a margin call from your e-broker and the cheeseburger will come in handy when it comes to gaining energy and repeating the same cocksucking/margin call cycle.

Fuck you Wanker and may you be living in Detroit for all eternity.

Fucker.

Fri, 04/30/2010 - 21:05 | 326447 Miles Kendig
Miles Kendig's picture

Perhaps Harry will follow Heidi's example and discover that his future joys will be wrapped around his new job assignment.  Food service AM, pots & pans with Monday & Tuesday off using his .19c an hour to meet his FRP dreaming of the day he can go to work in a UNICOR factory making postal baskets or office cubes.

Fri, 04/30/2010 - 23:49 | 326594 Brak82
Brak82's picture

+1

Fri, 04/30/2010 - 20:22 | 326414 rubearish10
rubearish10's picture

Hairy "Wey Canker" Wanker, you are an asshole and you'll never amount to anything. You're a slimy wet slug and you'll end up broke. Have a nice weekend bro!

Sat, 05/01/2010 - 16:24 | 327239 Waterfallsparkles
Waterfallsparkles's picture

Yes, drink the Kool Aid until it is no longer spiked and someone put arsnic in the punch.

I think GS put arsnic in the punch bowl.

It does appear the they keep replaying the same trading patterns every day and week but they may change.

We will see.

Fri, 04/30/2010 - 19:52 | 326390 Fazzie
Fazzie's picture

Mondays action according to my propietary pulling predictions from my ass model are as follows: 

CNBS Full court propaganda press; The " Greece saved; Goldman unfairly bullied, their stocks a bargain" version.

  Routine futures gunnage followed by pre market ramp job and a opening bell cyber broadside of the zombie banks algos 16 inch buy buy buy guns!!

 RISK ON!!!!! Just kidding about all those stupid bonds Friday. Bonds are for wimps!

  Then "Breaking news" from CNBS; Greece is saved dammint and this time we mean it!!

 

    Dick(head)Boves bearded visage once agains reminds the masses that insolvent banks are cant miss investments, and criminal charges make them all the more attractive.

 

 Cramer pumps the zombie banks as well, since he is stuck with a lot of BAC to dump.

 

  The low volume melt up staggers back to its feet, down but not out.

 

 Now if all the hedgies will just wait their turn and ease those sell blocks out quiet like, the dumping of all those wore out stocks no one wants can be snuck out the back at a pretty good price, especially the front runners.

 

  But the herd is awful restless and and the first algo to scream "RISK OFF!, BONDS AINT SO BAD"!!! will set the stampede off for the exits.

 

 Monday goes from + 120ish to a minor dumpathon -160ish.

Fri, 04/30/2010 - 20:49 | 326440 Cursive
Cursive's picture

Lot of words for a gap and crap, but I'll buy it.  In fact, Lady FAZ is a friend of mine.  ;-)

Fri, 04/30/2010 - 22:04 | 326504 feeb
feeb's picture

I prefer short FAS/long FAS puts to FAZ long...better to let the volatility work for you IMO.

Sat, 05/01/2010 - 00:17 | 326615 Fazzie
Fazzie's picture

  Hey, Ive always wondered about that very thing. For bearish bets of a few days at most and assuming the rifin does indeed decline for most of those days (quite a long shot,lately),

Would a FAS put (buy to open) yeild more than a FAZ call option (buy to open)?

Assume atm calls and puts.

 The Fas would tumble more points in absolute terms, being as its up over a hundred bucks now with Faz down around 12 dollars, but percentage wise would one just go up 10 percent and the other down 10 percent?

 And then if the relative amounts of share price matters, then at some point they would meet each other during a long downturn.

 Then theres thew decay. Some people point out a put option on these etfs would avoid the decay effect of the underlying shares when they reset and even suggest this works for you, but then wouldnt some smarty pants out there set up some sort of arbtirage trade if that were true?

 Thens theres the voalitility characteristics of a put option increasing in value relative to the call increasing in value and so on.

  I never went to the school for those who cant do math good, Im no fab fab and these questions make my head hurt.

 I do know a call option can increase exponentially (rarely had it happen!), but the underlying security on a put option can only go to zip.

  Really, I just keep it simple because well, my math skills are.

 I know this is way off topic, but I would love any insight from the calculus majors out there.

Fri, 04/30/2010 - 23:49 | 326591 Fazzie
Fazzie's picture

 Ahh yes, it boils down to the ol gap and crap, its just with all the simultaneous soap operas unfolding, its kinda amusing anyway.

  (My apoligies, I accidentally flagged your post as junk with bad mouse technique, no actual junk implied!)

 

 EDIT: Apparently posts can be restored to junk free with a second click!

 

Sat, 05/01/2010 - 00:56 | 326642 Mentaliusanything
Mentaliusanything's picture

When Crippled Boats sink they always point up on one end before sinking beneath the waves.

I think there is something in that for everyone, don't you. Titanic titillations of the Mind.

And for Harry a little lesson in market reality. No shorts, No balance on the down side

http://thefundamentalview.blogspot.com/ 

They just scuttled Greece by interfering in the balance.

Sat, 05/01/2010 - 01:30 | 326663 primefool
primefool's picture

As I mentioned in another post. Don't be fooled by the fact that no amount of bad news was able to tank the market for more than a few days UNTIL NOW. This is a brain-dead , auto-pilot cyclical bull within a large Bear configuration that really started in 2001. Remember the markets in 2003-2007 - similar brain-dead autopilot buying was going on. Nothing mattered - not earnings, economic data, oil prices, interest rates - Nothing .....Until Bear Stearns. Then fear came in . Then a few months later Lehman - oops.

The lesson for me from this is nothing matters to the stock market except the health ( ie. Govt support) of Wall Street. The moment that is in doubt, you get big sellofs. Just a hypothesis. Responses welcome.

Sat, 05/01/2010 - 02:11 | 326681 Mentaliusanything
Mentaliusanything's picture

The market may be expressing itself better than you think. Just a perception looking at a nice head and shoulders. Its funny but oh so perfectly serious.

http://3.bp.blogspot.com/_RHwzqq5yGy0/S9sRhQEEp5I/AAAAAAAAAvo/9jW136JSEtA/s1600/the+Lloyd+Blankfein+Top.jpg

 

 

Sat, 05/01/2010 - 07:41 | 326775 Greater Fool
Greater Fool's picture

I agree with the idea that, in hindsight 50 years from now, people will look back on the first decade or two of the century as a single decline.

Speaking purely qualitatively, however, I would say that now is not the time to expect a big blowup. Corporate earnings are still good, so there is arguably some basis in reality for prices to go up. Bubbles only burst after everyone has long since come to the silent agreement that there is a bubble. Don't think we're there yet.

Also, despite the general tenor of comments on this board, there is still a degree of logic in the response to news items. Bad news about GS, for example, has generally been followed by big drops; the default setting is to go up in the absence of bad news, but this is normal for a stock market, in which the universe is naturally net long, so the overall pattern of drifting up and jumping down seems pretty normal.

My recollection of the sign that 2008 really was the twilight zone was that these responses very often were opposite to realistic expectations: Bad news was often followed immediately by big jumps up, good news by rampant selling. I would expect to see more of this kind of instability before the next leg down on the "W."

Sat, 05/01/2010 - 09:59 | 326831 Madhouse
Madhouse's picture

The disturbing element of this GS storm is that they have an Elmer-Fuddish character who is barely coherent at the helm. After carefully listening to him over the past week, I can see pretty clearly what their problem is. What the hell was this guy, some sort of 2-bit broker ? It is amazing to think about what he gets paid. And then my subsequent thought is that a lot of it is being charged to my unknowing kids' tab.

Give us the $12 billion back and get Blank-boy off the air, he makes me sick.

Sat, 05/01/2010 - 12:08 | 326962 theprofromdover
theprofromdover's picture

Because Goldman Sachs isn't Goldman Sachs any longer.

It is really J. Aron.

(the Squid must die)

Sat, 05/01/2010 - 12:25 | 326981 Jim B
Jim B's picture

+1

Sat, 05/01/2010 - 16:06 | 327218 Mark Beck
Mark Beck's picture

If you look at the status on ARRA it has a long way to go. The question is, why not just increase the outflow if stimulus is what you want? What would a new stimulus package do, that ARRA and the remnants of TARP cannot do?

The issue is you have to recognize the overall impact of costs, especially in terms of government spending(waste), in order to create efficiencies for sustainable economic growth. You cannot use debt to influence growth and then tax this same growth. The effect is a net loss, and in some cases up to 100%. Also, as you play these ineffective games there is an impact to the real worth of savings. Which will hurt future growth.

The new stimulus?

The only area that is "new" for Washington and the FED, in terms of targeted stimulus, is how to directly bail out the states through the FED's ability to create money? They have done their best with ARRA in this regard. But, the states are so bad off that, in some cases, it is hard to come up with matching funds to start a project and claim ARRA funds.

As we talked about before, GDP is not a very useful "thing", in understanding what is happening.

----------

The financial sector has done a relatively good job at using the several avenues available to make their financials look encouraging. However, we have a new dynamic, and that is we have to dig a little deeper to find out what is off balance sheet, SIV and so on, and subsequently what is the true equity position of these companies. Then we have to compare this with the stock price and the potential for growth.

What is clear is that there are a lot of unanswered questions from the boards of the big banks. So I would have to say a decline in the financial sector should be driven by the violation of trust and the recognition of risk.

The emphasis has been placed on these firms being TBTF, and as this type of support is removed it is now an indication of weakness. But, the reality is that many of these firms had the opportunity to move towards solvency, at the expense of profit as seen from their prior leverage. Obviously, solvency was not high on the list. As per the plan, these companies push the balance sheet as far as it will go, without regard to any long term stance.

As we look at the financials we ask, okay what really is off balance sheet, and if recognized, what is the true position of the company? In this regard you have to make some educated quesses on to what the loss exposure really is. So what we see is that even a conservitive estimated reduction in asset price, which really assumes a minimum of writeoffs and a healthy market (one not dominated by the government), many of the companies would not break even, let alone meet a required equity position, which is not required by the FDIC at this time.

----------

This is our crazy world, in which private markets, and determining intrinsic value in firms, are left up to the whim of politicians, both in manipulation of the financials and establishing risk.

Is this investing? and if not, what is left of the market place?

How do we put private capital to work in this environment? These mechanisms are what create the economy. Without them we have lost capitalism, we have lost America. 

Mark Beck

Sun, 05/02/2010 - 00:37 | 327533 goober
goober's picture

There is an election in November after that would be a perfect time for the downside and then up prior to 12'. I doubt TPTB will let this market slip too far before Nov. A slight correctio maybe but not much. They certainly won't let the financials tank. Goldman and JPM will get a spanking and all the focus, otherwise business as usual. And yes there was a big spike on SPY after hours. Of course GE is basicly insolvent, but what does that matter with the right friends in the WH? Lets create more banks with the stroke of a pen. Seems pretty obvious what the illusions are and who will benefit and lose. Every good scam needs a few sacrificial lambs. I think Friday was a massive shake out move. We'll find out before next Friday.

Sun, 05/02/2010 - 00:40 | 327537 Grand Supercycle
Grand Supercycle's picture

 

DOW chart shows an expanding wedge indicating a significant move is probable.

MARKET UPDATES:
http://www.zerohedge.com/forum/latest-market-outlook-0

Sun, 05/02/2010 - 02:46 | 327582 goober
goober's picture

Mary I agree with your thesis/rationale but would add. The majority of trades are fulfilled by the very supposed banking entities ( idon't actually consider GS/GE/GMAC to be real banks) that you speak of. Therefore it is all clearly an illusion of grand scale to create false security. If we could find out the real off balance sheet nubers of nonperforming investments/loans, the DOW would be at 7500 to 8500 maybe less. So when its all said and done aren't we all fooling ourselves? Aren't we all playing into the iluusions? I think so. Me included trying to capture some form of SAFETY? Whatever that means now.

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