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The Laws Of A Traxis: From Permabull To Bear in 48 Hours
June 30 (Bloomberg):
Biggs said bullish bets make up about 70 percent of his investments and isn’t selling because he expects the S&P 500 to finish the year 10 percent to 15 percent above its level now. He favors property developers, oil service companies and technology suppliers in the U.S. and emerging-market equities.
“I still believe that it’s just a soft spot,” said Biggs,
who helps oversee $1.4 billion at New York-based Traxis, in a
telephone interview yesterday. “If we have 3 percent real GDP
growth in the second half, chances are we’re going to get
somewhere between $85 and $90 a share in S&P 500 earnings. It
might be a little less than that. It might be $80, but S&P 500
earnings are going to be fine.”
July 2 (Bloomberg):
Signs the U.S. economy is weakening convinced Traxis to
reverse course as the S&P 500 posted a weekly slump of 5
percent, bringing its loss since April 23 to 16 percent. Biggs,
77, said yesterday he cut bullish bets by about half since June
29, when they made up 70 percent of his fund.
“I can change my mind very quickly,” Biggs, who manages
$1.4 billion, said in a telephone interview following the
Bloomberg Television appearance. “I’m not wildly bearish, but I
don’t want to have a lot of risk at this point. I just want to
have less exposure at a time like this.”
Wow. So much can change in 2 days. Then again, with the fund having just $540 million in equity assets according to Thomson Banker, 70% of this is something REDI can trade out of in 3 minutes. Thank you VWAP.
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Don't tell Leo, he is still working off the June 30 release.
This Biggs character is something else.
I listened to a live interview just a couple of weeks ago - yes, things were falling apart to those with half a brain and wanted to see - with good ol' Biggs. I can only sum up his ridiculous out-of-touch-with-reality comments as thinking that I was watching/listening to Leo.
I mean HOW this guy could have made the comments that he did and actually manage people's money is beyond me.
Perhaps he was talking up his book while trying to unload it? Or am I giving him to much credit?
BIGGie small?
He's 77. His book has a WGAS I could die tomorrow theme.
Stick with the young bucks if they fuck up you have a lifetime to destroy them, or they make good on the losses.
Old guys, no recourse.
In the spring of 2008, when equities had just begun their deep grind down, Biggs came out in the WSJ with a splash to argue--strongly--that the S&P will be 200 points higher later that year. After Bear blew up and equities continued to nosedive, I wrote Biggs an email, not so much to point out how badly he was wrong, BUT to ask for a retraction to tell his followers not to stay long.
He replied immediately.
He yelled at me, saying in effect: "I DID reverse my positions in the fund. And I don't owe anyone any explanation or announcement".
I lost all respect for him. Not for being so blatantly wrong, but for being such an asshole. He took care of himself, but couldn't give a shit about anyone else who was stupid enough to have listened to him.
That is the industry to a tee. Trust me, all those blowhards on cnbc recently telling everyone to get longer into this "correction" know exactly whats happening and are positioned themselvers personally to the downside. But 401k bagholders - you just keep getting longer.
The industry is about SELLING. Everytime a portfolio manager , analyst , pundit , salesman , tells you to buy , you are being sold. No different than car salesmen or realtors.
Alec Baldwin in Glengarry Glen Ross : thats what those blowhards are like off camera
http://www.youtube.com/watch?v=TROhlThs9qY
ABC - ALWAYS BE CLOSING. Ignore Wall St. Everything about it.
and while you're at it, check out the girl scout version.
Ha, ha, ha. ABC = Alway Be Closing. Great movie. Best movie with Alec Baldwin ever.
I've been in various trading/sales jobs for
30 years. I've never seen Biggs be correct.
Although it must have accidentally happened
at least once.
Fantastic. I knew that old douche was bound to drop the pompoms though after listening to him spout off some thick bull for over a year I thought it may never come.
The only SOFT SPOT, Biggs, is between your damn EARS!
Are you by any chance married and/or related - like from the same gene pool - to Abby Joseph Cohen?
Get a friggin' clue or stay outta the media...
i agree. stay out of the media, biggs. you're a dangerous man.
hey biggs... perhaps you and pete stark should get together for a round of golf.
http://www.youtube.com/watch?v=5qVpMwqv7QM
What an arsehole...... These are the elected officials. Dumber than a box of rocks.
Here's another:
http://www.youtube.com/watch?v=GWaBkJSPXtk
So what does that say about the electorate that put them in office. Dumber than these elected arseholes.
The only electorate in this country is on Wall Street (or occasionally the SCOTUS).
this is an excellent point. congress, even when so inclined, may not reform itself as it violates their constitutional rights to reduce corporations' power to bribe congress to write laws (or in the case of tbtf get the executive branch to act extralegally). so says the scotus. it also said that trying to teach someone (anyone) put on the "terror list" non- violent political tactics is speech that can be criminalized. nice to know who counts.
Why ZH should dignify Biggs' "thoughts" by even mentioning him is beyond me. When you look up Infamous Wall Street Thieves and Criminals, there's a picture of Biggs...
Well, sure, with taxes going up Jan 1, a VAT in the air, encouragement of sloth, discouragement of savings and hard work, and a general vilification of business from Congress and the Executive, I can easily see stock markets shooting up nicely.
But that's not all! All that federal government debt is very encouraging too. The picture couldn't be rosier than that, but it is: China is in a dangerous bubble, and demographically moribund Europe's welfare states are endebted to the hilt against zero possibility of ever paying down.
All isn't just well out there, it is utterly peachy.
Fans of war movies, grim history channel stuff, military channel footage...they'l be served! 3D and sensurround, like it is happening right in your front yard.
Argentina, from the favorite to win the World Cup to the airport of Cape Town after a 4-0, in less than 48 hours.
¡Buen viaje muchachos!
ah, but you said Brazil would win ZIna, didn't you?
Anyway Brazil was unlucky
yes i wish i had his money but he has been wrong for 10 years, i think next year's self made list of "uncommon surprises" ( are there any other kind? )should include just one, 10 times, "I,barton biggs will be right for the 1st time in 11 years"
77 was about the age where my compos mentis father decided he couldn't manage his own money very well anymore, and of course his assets weren't being moved around asset classes to maximize alpha, and of course he had no fiduciary duties to anyone.
Time for Biggs to decide thusly, it would appear. Selling at lower prices on perhaps marginally worse-than-expected data points. Huh?
He will be removed from the CNBS "cheerleading list" for making such bearish comments. Biggs it is time to retire and hit the golf course.
Ya'll hit the ball, not the golf course. No reinforcing his frailties.
I don't know the man or anything about him, but I give him credit for responding decisively to recent negative economic data rather than continuing to toe the Fed's party line ("...the economic recovery is proceeding..."). I hope my company's retirement fund managers are like-minded enough to do the same.
How about a fund manager who is capable of RECOGNIZING the REALITIES and see through the FOG (i.e. BULLSHIT) - much like the people who run/participate in blogs like Zero Hedge - rather than REACT when things become so OBVIOUS a FIVE-YEAR OLD can see it?
At least, the man is reactive. You cant take that off him.
Sign of a surviving vetran.
1. Capable of seeing the changes and acting on what he sees.
2. Admitting a course of action is wrong when the facts point it out.
Too bad our politicians can't act accordingly.
Sign of a REAL surviving veteran: Capable of recognizing the light at the end of the tunnel as a TRAIN!
probably a noncom.
77=Golden years. If you cant get lucky at 77 then something is wrong.
Classic, this guy truly is ridiculous. Mind you so are 90% of the commentators/ "fund managers" out there.
I saw Biggs' interview on Bloomberg TV on Friday and was very surprised to hear he'd turned bearish.
To be fair to Biggs, he called the March 2009 bottom and at the time he predicted the S&P 500 would rise to 1200-1300 within a year because of the enormous amount of liquidity that was flooding the system. I thought he was full of shit but he turned out to be right, so for better or worse he deserves credit for it.
In any case, if guys like him have started liquidating and are getting the hell out of Dodge while they can, that probably explains why the algos/PPT/Ben Shalom's traders have been unable to support the market.
"I’m not wildly bearish,..." - meaning i'm done with selling, and about to finish my 70% short position, and that's when I'm going to come on the air and say the market is about to collapse. And there's nothing wrong with it, since the moment he "turns" bearish, he'd sell, and then go on TV and announce that, not in the reverse order.
btw, Cramer can turn from bull to bear between noon and 4:30PM taping of his show!
How about the useless & gutless Greenspan/CNBC interview. Cross eyes and insert finger down throat.
I had mailed out a comment to our group early this morning, with the same theme. For some reason Barton always annoyed me.
Whenever this guy was on Tom Keene, I would post in chat that he sounded full of crap, a mindless stock pumper...like he was mostly just talking his bookNow it turns out he sold half his US holdings...he says this week. OkieDokie
I can change my mind very quickly,” Biggs, who manages $1.4 billion, said in a telephone interview following the Bloomberg Television appearance. “I’m not wildly bearish, but I don’t want to have a lot of risk at this point. I just want to have less exposure at a time like this.”
Well Barton is honest, and that is appreciated. However, if Barton Biggs, the biggest "green shoots" cheerleader can sell..who next? We can probably expect more in coming weeks, IMHO, and they will not be telling you in advance of their plans. I'm sure if they're on MSNBC or other pump network, they will still be expressing faith in the economy and the fundamental value of equities as a long term hold. For YOU perhaps, while they divest themselves, lol. No one wants to be accused of starting a panic on national TV, unless they're a well known and easily ignored bear like Peter Schiff or Nouriel Roubini
So much for anyone believing that all of this bad news isn't being noticed, despite a wonderous lack of public discussion about the rapidly deteriorating US fundamental picture on the big public media. I guess it might put a damper on the attempt to still nurture dead seedlings into "green shoots" again. Guys, give it up. The shoots have been sprayed with Corexit 9500, and even the pumper clowns can see it.
There was some scratchy attempt by Obama yesterday to spin the jobs numbers as good, but fund managers who managed to survive the past few years know better. Foreign buyers of US equities are no different. I believe more than a few are probably thinking "here we go again".
Bad memories of forced selling to meet redemption calls in Q4 2008 must still be fresh in mind, and no one wants to be the last out the door. Of course there are believers, and those willing to buy what they perceive to be a bottom...and if there are enough of them Fibonacci 1008 may hold.
Hopefully that may be the worst we see. Somehow I don't think so, but the next weeks will tell. However it would be naive to think that many fund managers aren't reducing their positions, taking risk off the table as the economic picture becomes murkier. Other cheerleader fund managers may think twice this week after seeing this public defection of one of their rank leaders...after all, they are by definition group think creatures.
Parallels to summer of 2007 and 2008 (housing woes are 'behind us, Bear Stearns collapse a "one off" and the worst is behind us...)
Meanwhile off the radar, despite blatant pumping of BP stock, a collapse is brewing behind the curtain. Lehman II anyone?
Just like in the summer of 2007 and summer of 2008, the spin continues that any trembles in the Spring were a mild shake that has no possibility of getting worse. Now they're saying recent data just reflects one bad month and the 'recovery' is well on track (despite the fact that this strange recovery is losing jobs, features increasing commercial foreclosures and delinquencies, plus surging consumer bankruptcy rates.)
- Summer 2007 Denial themes: "housing panic? That was just a spring blip!". Employment is strong, and most people can afford their ARM resets.)
- Summer 2008 Denial themes: "Bear Stearns collapse? That was a one off event. There are no toxic CDs on bank balance sheets, and the worst is behind us". Subprime loans are a small franction of loans outstanding, and bank balance sheets have more than enough capital to withstand any single quarter downturn
- Summer 2010 Denial Themes: Sovereign debt crisis? That has been resolved. Greece, Spain, Portugual, Ireland, Italy are well positioned going forward. There is strong demand for these countries debt auctions, and European banks have more than enough liquidity to withstand any event going forward. In the US unemployment is merely a lagging indicator, and the recovery is well on track. Housing is strengthening
Wash rinse repeat! You'd think people would catch on by now...
Well said, Oldbold.
However: People have caught on. Many of them read, and occasionally comment, on ZH.
If everybody had caught on, stocks would be below Smithers' fair value, which would mean SPY 70 or whatever.
Thus ZH'ers retain a competitive advantage.
If you read it closely, you can detect the scam in the bull/bear call:
On June 30 says bullish and not selling
and 2 days later it says been selling half since June 29 Yeah OK!
The Wall St fraud continues unprecedented!
BINGO!
+1ooo
Lookie Here! Dr. Freud proves true again. Just listen and folks do tell all. Why down South it's said; "Do say...."
Hey, Biggs, is that you going through the posts and JUNKING everything or is it one of your LACKEYS?
IMF just poured $14.9 Billion into the Ukrainian black hole.
"The International Monetary Fund mission to Ukraine will recommend the release a loan worth 14.9 billion dollars to the country for the next two-and-a-half years, the Interfax agency reported on Saturday."
"Ukraine is enduring one of the worst recessions in the world after its economy shrank 15 percent last year -- the biggest drop since the industrial collapse that followed the break-up of the Soviet Union in 1991."
http://www.breitbart.com/article.php?id=CNG.dc87adb20fddc3ed3490122f7946...
Sounds like a safe loan to me....LOL!. Not sure there is anyway they could pay that back in 2.5 yrs. with the rest of Europe about to seriously (supposedly) rein in spending.
he's 77 with a bad voice (he should see seek out an ENT) but as wrong as he has been his timing in this interview could not have been better
March 9, 2009 Charlie Rose
http://www.charlierose.com/view/interview/10135
(talk about luck)
How come this dude ain't at Goldman?
MS, B Team.
If we get a temporary bounce here this shall henceforth be known as the Barton Biggs panic bottom.
yes Tyler, I'd just like to vociferously complain about this outrageously misleading post with a Dune reference title in it and yet discussing stocks.
meantime I'm buying big-cap with solid earnings and good balance sheets ... LOLZ
Seriously though, Dune......*spice* ?
Completely off subject but interesting. The rush to drill tight gas shale wells in PA is related to the rich liquid content of the gas according to a friend who works for a large service company supporting the frantic drilling. W/O the liquids these wells would be marginal based on current gas prices. IMO, the operators also want to drill as many wells as possible before the EPA takes over with more costly regulations.
Fed caught in bold-faced lies.
Turns out, among other things, Maiden Lane assets assumed by Fed on Bear Stearns collapse included $16B of credit default swaps. This has never been reported until now, and directly contradicts Congressional testimony by Geithner and Bernanke at the time.
If $16B is the premium value, God only knows what the potential losses are. And until we learn otherwise, let's just assume that the underlying debt was Bear Stearns', and the counterparty was JPMorgan. In other words, that JPM bet with Bear against Bear itself, then killed Bear and transferred the losing bet to "we the people."
Hmmm could this be the $138B paid to JPM by the Bear bankruptcy judge on a Saturday morning in October, 2008, for Market Stability reasons?
More of Bloomberg's Caroline Salas, please, please.
http://noir.bloomberg.com/avp/avp.htm?N=video&T=Salas+Discusses+Fed+Secr...
this clown was bullish in early 2008, and got crushed.
at some point, these dirt-balls that get on tv and pump their positions, need to be treated just like a sell side analyst; if you change your rating, you need to do it publicly before selling. what a fraud. heebner, riley, paulson (wells fargo), darda, gabelli, cooperman and the rest of the asset-gathering buy-side elite just make me sick.
He got crushed in 2008 but he made new equity highs in 2009 which was quite an accomplishment. I would love to know how he fared so far in 2010, by the sound of it he's down, I wonder how much.
http://www.mffais.com/stock-owner/traxis-partners-llc.html
Happy Dependance Day everybody!
Barton Biggs is a clown who has got away with a ton of bullshit in the day before the blog.
The question is what new data did Biggs act upon that was so abrupt after riding a 16% loss?
My guess is risk accociated with Financial sector exposure. The consequence of massive wealth transfer and investment in the banks have created a type of sector market hypersensitivity.
I ask myself, why do I feel that Financials are the market?
Was Biggs waiting for the usual market correction that never came?
Who forgot to hit the market boost button?
What ever data Biggs acted upon it was a surprise? Something unplanned, and unresponsive.
If the tide has turned for bank solidarity and there is a run for the exits, hold on to your butt.
Mark Beck
I caught part of his Fri. interview where he was calling for another stimulus package to help support stock prices................absolutely fnng amazing....
BB has not for nothing a major in english literature, and a former stockbrocker = financial Hollywood. He is a man without any understanding of financial markets and a cheerleader. It is totally unclear to me why people pay any attention to him. His trackrecord at MS was also horrible that 's why his plumber became a more succesfull investment manager.
What a moron. This market is in a deflationary suck hole for the next 6 months. And sell your gold Tyler, because it will get sucker down as well. Precious metals will not escape this suck hole in the short term, so stop talking up gold.
The linked mechanism historically was opposite movement between USD and Gold. Gold dropping in its roll as a commodity in 2008 was a legacy effect due to movement in capital. However, in the past 5 months we have seen a delinking due to sovereign default pressures. And as recent as last week gold was unlinked from equities and the USD.
I think Gold will continue to unlink as we move forward. The only real downward pressure we have seen was the panic spike low last week. Other than this the trend has been very solid since JAN 2010. So much so, I believe it has become a hedging pair.
Mark Beck
Fine if you think gold is a commodity, but most people perceive it to be a currency first and foremost.
old fogies are funny
Gold $1250 to $950.00...then to $1500.00 b/c of QE 2.0
You may not quite get it. Except for transactional needs, it makes at least as much sense to express $$ in terms of gold rather than your traditional way. Gold came only a few thousand yrs before $$ and while the future is, well . . . the future . . . my bet is that gold endures a lot longer than the $. Gold is the people's money whereas $$ allow the elite to run things.
In the blink of an eye, our current fiatscos can be declared worthless by the PTB and some new stuff be declared legal tender. Globally my bet is that gold will be tradeable for goods and services/"money" almost everywhere even if it is (temporarily) verboten in the US.
So who really cares what path of depreciation against gold the $ takes? Only Ben and BO know for sure . . .
Gold faces a suck hole vortex during the "waterfall" equity suckout we will have by October. Mass liquidations will take gold down. $950 is a good target. Gold is NOT a currency yet, even if it trending there. There is one or 2 gold suckouts in the pipeline for people to loaad up. So Tyler, stop talking up gold which is about to get hit in next 3 months.
http://www.creativedestruction.us/men39s-tshir39.html
Apparently nobody here remembers the days when Barton Biggs was known as a perma-BEAR. Personally, I'd rather have Biggs run my account than most of the ZH commenters who trash him.
There are some with short and/or shallow memories here.
Who was it that was suggesting an investment (or hedge) in farmland, self sufficiency, ammo, etc...; a doomsday retreat, was a wise investment? Barton Biggs.
People, get a grip. Yes, opinions change. Sometimes quickly.
Biggs March 2007
``I'm bullish longer term and I'm bullish short term.''
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=awryT2jZ2atM&refe...
Biggs May 2008
May 5 (Bloomberg) -- The U.S. economy will grow in the second half of 2008, the Standard & Poor's 500 Index may climb to a record this summer and commodity prices will retreat as much as 30 percent, hedge fund manager Barton Biggs said. Companies aren't expressing ``gloom and doom,'' and the economy is ``not as bad as you would believe from listening to the press and some of the Wall Street commentators,'' Biggs said during an interview with Bloomberg Television from New York. The 75-year-old said the S&P 500 may top its October record of 1,565.15 this year. Reaching the all-time high would represent a gain of 11 percent from today's close.
Tyler, do you have more info about the latest US sanction bill against Iran signed on July 1st by Obama? Looks like this bill bans any oil transactions with Iran. At the same time, Iran is moving military to coastal areas.
I think we need to follow action carefully.
Updated DOW chart:
http://stockmarket618.wordpress.com
http://www.zerohedge.com/forum/latest-market-outlook-1
you forgot this October 2008 Bloomberg article on Biggs
Barton Biggs Says U.S. Stocks Are `Very, Very Cheap'http://www.bloomberg.com/apps/news?pid=newsarchive&sid=agfBvhFer_rI&refe...
In 1999 he was in disbelief with the dotcom rally, stating it was beyond reason and simply "befuddling". correct. In 2007-8 he was buying homebuilders, citing all the data supporting its strength. Very incorrect.
GOLD daily charts are still bearish.
http://stockmarket618.wordpress.com
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