This page has been archived and commenting is disabled.
Post Debt Agreement Crash?
The debt agreement is now history but so far this is shaping up to be another terrible week for the stock market.The Standard & Poor's 500 lost 2.6 percent Tuesday as investors grew increasingly concerned about the economy. The benchmark index is now at its lowest point of the year, erasing all of the year's gains in the stock market.
Before the market opened today, I sent out this message to my distribution list:
The Senate should rubber stamp the debt deal. I think they will sell the news, the stock market will tank, but it will recover tomorrow and rest of week (maybe even this afternoon). Friday's US payrolls will be weak but that dip will be bought too. Importantly, even though economic data will come in weaker-than-expected, keep buying the dips on risk assets.
A Montreal hedge fund manager responded by reminding me that I have nothing to gain by making market calls and can only lose. He's right, it was very ugly on Tuesday as traders took their marching orders and took RISK OFF. By day's end, pretty much the only thing green on my screen were the Ultra Short Proshares (click on image to enlarge):
Actually, Ultra Short Proshares weren't the only thing moving up. I also noticed a few stocks here and there that made big moves up. Stocks like Radian Group Inc. (RDN), the second-largest U.S. mortgage insurer, soared 15% on Tuesday after the company swung to a profit on derivative gains and said there was a drop in delinquencies on home loans (note Fidelity and Wellington are top holders).
But generally speaking the mood is dismal out there. I took the day off, went to meet another excellent physiotherapist who was highly recommended to me. She is incredible and to my surprise, she admitted to me that she too has MS. She is also very open about it just like me. And like me, she takes no medication whatsoever, watches her diet, exercises, and has a positive attitude. Actually, she has a better attitude than me and told me the minute she got diagnosed she said "Ok, MS, next"). We talked about how people have the wrong attitude when they hear you have MS. They generally pity you and say stupid things like "I am sorry to hear that" or "poor you."
Poor us? Why? Because we have MS? Hah! You should see this lady work. Unlike most people in finance, she works her tail off. She took a full hour with me, evaluating every part of my body. She's strong and was telling me "push harder" as she tried to evaluate my strength. This lady is truly amazing, not because she has MS, but because she is really good at what she does. She made a program for me that consisted of balancing on a platform, on one leg, breathing exercises (through the stomach), and lying on my left side in a fetal position and opening up my legs to work a specific right glut muscle which needs work. I was very impressed and can't wait to see her again. She inspires me.
I then went downtown to hook up with one of my favorite strategists at Nespresso on Crescent street. It was a beautiful, sunny day but he was dressed in a suit so we sat in the shade. He was happy that he made the right call on stocks and sees all the leading indicators, including the ISM, rolling over. "All the other strategists called this a soft patch but that's because they still use old econometric models." He added: "This has nothing to do with the debt ceiling crisis. The US economy is slowing and so is the rest of the world. Just look at the Korean and Australian stock indices."
I told him that the US economy is in for a long, tough slug which could last decades and these are perfect trading markets. He agreed. We also spoke about the characters in finance and I shared something with him that my psychologist told me. She told me:"Leo, you'll never be happy working in this industry because you're looking out for the little guy but the industry is full of sociopaths looking to screw the little guy over." And she added: "Remember what I told you, acceptance is freedom from hell. Unless you're willing to accept that this is an industry of sociopaths, and that you won't change them, then you'll always be miserable working in finance."
This is true, which is why I prefer doing my own thing, blogging and trading. But there are plenty of good people in finance too. Case in point, the person I met up with today. He's smart, ethical, extremely successful, made it outside Quebec, and has nothing to prove to anyone but himself. He could have easily become an arrogant, insufferable, narcissistic prick like so many people in finance who achieve "success," but he has his two feet firmly planted on the ground and values the important things in life, namely, his family, friends and health. I just received a copy of his book, which he co-authored with another first-rate person, and I'm already reading it and will review it on my blog (need to review a few books).
Some concluding thoughts. Economic data will continue coming in weaker than expected and the stock market will gyrate wildly (don't get too cute shorting this market). This Friday, we're going to get the latest jobs report and see if the US economy is creating any meaningful job growth (don't hold your breath). The jobs crisis remains the single most important issue that policymakers have yet to adequately address.
Below, I leave you with a couple of must watch interviews. One with Martin Feldstein, an economics professor at Harvard University, who talked with Bloomberg's Tom Keene about the risk of the U.S. economy slipping into a recession. And the other is CNN's Wolf Blitzer interviewing the independent senator from Vermont, Bernie Sanders. Mr. Sanders reminds us that millions are struggling to get by in this economy and couldn't care less about the stock market (unfortunately CNN posted an edited version online; it is worth watching the full interview posted on YouTube).
»
- advertisements -
Do you mean to tell me that people actually subscribe to a distribution list to read this shit?
It is rather difficult to imagine, isn't it?
But then again, people apparently pay to read the almost invariably wrong and worse than useless drivel of Dennis "Gimme another donut!" Gartman, and Robert "Gold to $300!" Prechter.
I am sorry you have MS Leo, but you will always be a wanker!
"Friday's US payrolls will be weak but that dip will be bought too. Importantly, even though economic data will come in weaker-than-expected, keep buying the dips on risk assets."
The pigmen still need their Judas goats.
You didn't say what they already believed Leo. And they hate you for that. All of these freethinking, nonconformists, that won't listen to a contrary opinion.
They only like their own little herd!
gh
P.S.
Leo, it would help if you put a picture of a naked woman in your articles. These morons think with their gonads.
and pray tell, why are you here?
No, asswipe, we hate leo because he doesn't make any sense, because he is an unrepentant statist to the core, and more than that, because of his blinkered, venal and terminally short-sighted support for, and complicentcy with, a corrupt, sociopathic and doomed financial and political establishment.
It amazes me that Leo still has contributor status on ZH.
Maybe TD likes having a few punching bags around. It is Fight Club after all.
This fellow Leo has no credibility from what I've read over the last year. NONE.
leo makes robo's calls look good.
funny thing is, robo is just joshin.
To paraphrase an old philosopher, if leo did not exist, we would have to invent him --- if only for the laughs.
Dump the dim-wit psychologist and hire a team of psychiatrists Leo. And please take heart that Wolf Blitzer may very well be more clueless than you. Everything is relative...
- Your ex-Big Brother
You're a stockpicker aren't you Leo?
That's because you're a born loser... keep playing the game of Russian Roulette with your portfolio, you'll be bankrupt by end of 2012 (same as Warren Buffet and Paulson)
That's OK, ZG --- you and I, and others who are awake and not mindlessly brainwashed and compliantly servile such as leo, can always take solace in the fact that, in the end, stupidity and cowardice are their own best punishment.
Yes Leo is very servile, his arselicking of the establishment is painful to read at times!
...but it's Leo's optimism that's going to bankrupt our fav' Candian crony and ZH Omega wolf.. he's still a Bull and he's about to be absolutely shredded in a Bear trap ;)
Leo, how are your losses in your big plays in 'tech' and 'green' this past week, run into 5 figures yet???
"I told him that the US economy is in for a long, tough slug which could last decades and these are perfect trading markets."
Indeed. Similar to the way a tar pit is the perfect swimming pool?
If it all goes to hell and collapses, how would this be "perfect" for trading? (apart from hauling stuff around for barter).
The big swinging dicks are working feverishly on the "structural issues", like getting the basements poured on their new digs before the first frost hits.
"there are serious structural issues that have yet to be addressed"
Leo - I have yet to see any structural issues addressed.
"And the other is CNN's Wolf Blitzer interviewing the independent senator from Vermont, Bernie Sanders."
Right, because we don't have a formal Socialist Party, yet.
We have a Socialist Party. It's called the "Socialist Banksters' of the World". They have offices in America and anywhere there is money.
Last time I checked, Bush, Hank Paulson and Neel Kashkari gave them 700 billion to save the economy.
Fascists are national socialists rocker.
And last time I checked, the community orgainizer in thief was all about sending trillions in debt bombs raining down on bankers and corps worldwide...that is fascism.
Maybe you missed it but Barry and his czars are gonna set records with his latest money laundering operation with the coming election campaign, all flowing back toward him from the very bankers you despise.
The Billion Devalued Dollar Man...lol.
Eat your peas.
O'Bankersrentboy is toast in 2012 ...unless the votes are rigged ...hell everything else is in America!
Socialist party? C'mon! Sanders is right advocating for the poor, elderly, disabled, unemployed -- basically the weak and disenfranchised who cannot buy politicians off. Grow up already!
Sorry, Leo. You're wrong. Bernie was a Socialist, but left the party because it caused him much trouble to have that albatross on his neck. As an independent, he gets lame brains who lack a sense of history to call him an "independent" who "cares".
Socialists care far less about the poor than anyone can imagine. They care more about power and how using it can "help" the poor by helping them gain power. Sanders is a Socialist. Trusting him is like....trusting Bush. Or Obama. He's an ass. No, I'm wrong. He's a horse's ass.
But if you trade in horse's asses, I suppose he's a horse's ass who "cares" about the poor, elderly, disabled, unemployed. HA! Give me a break. Because nobody else cares about these people? Right. Get a life, grow a set, and mature a bit. Few, if any, politicians care about these people even though they say they do. If you really DID care, you'd do what most of us who care do - donate to charity, spend time at a food bank, or at a shelter. You WOULDN'T enter politics.
Can't believe you fell for his charade.
Sorry, Leo. You're wrong. Bernie was a Socialist, but left the party because it caused him much trouble to have that albatross on his neck. As an independent, he gets lame brains who lack a sense of history to call him an "independent" who "cares".
Socialists care far less about the poor than anyone can imagine. They care more about power and how using it can "help" the poor by helping them gain power. Sanders is a Socialist. Trusting him is like....trusting Bush. Or Obama. He's an ass. No, I'm wrong. He's a horse's ass.
But if you trade in horse's asses, I suppose he's a horse's ass who "cares" about the poor, elderly, disabled, unemployed. HA! Give me a break. Because nobody else cares about these people? Right. Get a life, grow a set, and mature a bit. Few, if any, politicians care about these people even though they say they do. If you really DID care, you'd do what most of us who care do - donate to charity, spend time at a food bank, or at a shelter. You WOULDN'T enter politics.
Can't believe you fell for his charade.
Sanders is a complete an utter fraud. I know him very, very well, both personally and politically since before his days as Mayor of Burlington. He is a con artist, stuffed shirt pushing for nothing but wealth redistribution, all aimed at enslaving "victims" into continually casting ballots for him. Only in Vermont, home of the most oppressive anti-capitalist regime, can he occupy an elected office.
The man has no business being called a U.S. Senator. You, Leo, are bought into his game if you think he cannot, and is not, bought off, or that he is a genuine 'for the people' guy.
Yeah but Vermont has some great beer: Magic Hat.
Leo's profession is transgenerational wealth transfer... which can only be done at the point of a gun. Plus he has MS... and needs the kids to pay for it... again, at the point of a gun. All politics is local.
"Socialist party?" Yes, a fucking socialist Leo.
What he's always advocated for is the growth of the state and its elite class along with its debilitating debt that they think they will run away from.
http://www.democracynow.org/2006/11/8/vermonts_bernie_sanders_becomes_first_socialist
The times they are-a-changin.
This was the most STUPID article on ZH this month and it's only the 2nd day of the month. Keep trying
Coming from an utter moron, thanks, that is a compliment!
YW, just step it up please. No utters though
Were you not pumping Greek bonds at 7% over a year ago? What is the yeild now? You do put it out there, but your track record is less than stellar. You had better tread lightly with the term "moron".
That's out little leo!
His motto: When life gives you lemons ..... squirt them into everyone's eyes.
Yo, Akak! Here's Leo from a couple of months ago when I suggested he didn't quite grasp the significance of a low VIX: "I don't understand the VIX? Give me a break! You don't understand that we are about to head into a massive bubble and the VIX will stay low for a long time. It doesn't mean that negative surprises won't hit us, but so far the market has climbed the wall of worry and it will continue trending higher." --Market Guru Leo
The VIX is about 60% higher today.
http://www.zerohedge.com/article/how-low-can-vix-go
LOL
+1
Bought LDK today.
A few days ago you said buy the dips. What are you saying now? I'm confused.
I still think you should be buying this dip...read what I posted, they sold the news, stock market tanked but we shall see what will happen rest of week. On some stocks, I am seeing good price action already (JNPR, DQ come to mind, others too)
They sold the rumor too. They have sold off the last 8 days straight.
My status quo money trapped in my 401k will definitely have some stock exposure as we get closer to QE3 inducing pain, not gonna lie.
My apologies, fixed the Bernie Sanders interview because I had an older one. The one I just posted is from today's show.