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Guest Post: Buying Stocks On Margin At The Top - They Never Learn

Tyler Durden's picture




 

Submitted by Jim Quinn of The Burning Platform blog,

It’s like the movie Groundhog Day. Greed and hubris are the downfall of the mighty. Believing it is different this time is the mistake of the feeble minded. Watching the ensuing carnage will be a laugh riot. Seeing the blubbering of the bubble headed bimbos, pinhead pundits and Wall Street shysters when the inevitable collapse occurs will be worth the price of admission. If you think we're wrong, pony up to the trough, borrow some money and buy Twitter on IPO day. You can’t lose.

 

 

Of course, "this time is different..."

 

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Thu, 10/24/2013 - 18:00 | 4088182 TeamDepends
TeamDepends's picture

Final Preparations Check-list commencing in 3 2 1....

Thu, 10/24/2013 - 18:04 | 4088190 fonzannoon
fonzannoon's picture

Jim this time it is different.

Thu, 10/24/2013 - 18:11 | 4088212 SafelyGraze
SafelyGraze's picture

paging andrew maguire ..

andrew maguire to the trading desk ..

spoiler: Who Is Andrew Maguire?

Thu, 10/24/2013 - 18:22 | 4088241 NidStyles
NidStyles's picture

Some guy that no one cares about.

Thu, 10/24/2013 - 18:33 | 4088268 lickspitler
lickspitler's picture

Well load up, we got another 10-20% to go, these guys always early and broke. How many saw the tech bubble in 97, mbs bubble in 2005.

Thu, 10/24/2013 - 18:46 | 4088307 Say What Again
Say What Again's picture

When are you guys going to go short?

Also - based on the chart we have at least 6 months to go before we reach the "real-margin" levels seen in the prior market tops.

Thu, 10/24/2013 - 19:20 | 4088421 spine001
spine001's picture

This time is indeed different, in the past the Fed has never come even close to printing a trillion + dollars per year while considering printing even more if the economy doesn't restart. It is crazy and the craziness is being created by an out of control Hubris on the part of he Fed and the Obama administration. They are willing to take any risks to jump start the economy, even destroying it.

Thu, 10/24/2013 - 22:55 | 4088983 Non Passaran
Non Passaran's picture

In order to save the economy we had to ponzify it

Thu, 10/24/2013 - 18:34 | 4088269 THX 1178
THX 1178's picture

The charts just dont do it justice. This stock bubble is happeneing in parallel to a bond/dollar bubble and a real estate bubble. And derivative bubble. And it is happening worldwide. Fuck... We're fucked.

Thu, 10/24/2013 - 18:39 | 4088284 NOTaREALmerican
NOTaREALmerican's picture

Re:  And it is happening worldwide

It's an entirely new reality.   Worldwide bubbles inflating at the speed of fiat.

There's gotta be a lesson there someplace.   Oh yeah, here it is...

I'm keeping my powder dry to BTFD.   

Thu, 10/24/2013 - 20:23 | 4088566 Nothing but the...
Nothing but the truth.'s picture

People of America, you are being duped and screwed by your government - they're busy taking the country ,down the sewers.

Thu, 10/24/2013 - 18:56 | 4088351 lickspitler
lickspitler's picture

That is the funniest thing I have seen this year. Maguires been stackin alright stackin Bullshit.

Almost worth buying a new Modem to get back onto TF Metals blog

Thu, 10/24/2013 - 18:22 | 4088245 Everybodys All ...
Everybodys All American's picture

Different in an epic sort of way.

Thu, 10/24/2013 - 18:04 | 4088187 jubber
jubber's picture

I think you have the wrong film analogy..this is the Thelma and louise ending, the Fed have blown the biggest bubble in living history. Rather stop and face the consequences they  have decided to drive full speed over the cliff taking the whole world with it....we;re fucked.

Thu, 10/24/2013 - 18:11 | 4088213 Bluntly Put
Bluntly Put's picture

I remember the tech bubble burst, then the housing bubble burst. Are they gonna call this next one the Fed Bubble when it bursts?

 

Thu, 10/24/2013 - 18:21 | 4088235 NOTaREALmerican
NOTaREALmerican's picture

Re:  Are they gonna call this next one the Fed Bubble when it bursts?

No, debt is the narcotic.    The pushers don't exist.  

It's a moral failing of "da people".  

Thu, 10/24/2013 - 18:46 | 4088317 Say What Again
Say What Again's picture

Benny's Bubbles

Thu, 10/24/2013 - 18:48 | 4088321 NotApplicable
NotApplicable's picture

Of course not, silly. It will be called WWIII. The only people who will properly blame the Fed will be the FEMA camp residents.

Thu, 10/24/2013 - 18:08 | 4088203 Bryan
Bryan's picture

We are all being herded into the corral for the coming slaughter.  Tickets are by credit card only - all sales are final.

 

Thu, 10/24/2013 - 18:13 | 4088220 GrinandBearit
GrinandBearit's picture

As irrational as it is now, it can still become even more irrational.

Thu, 10/24/2013 - 20:02 | 4088519 stocktivity
stocktivity's picture

That's the smartest post of the night...It's all Bullshit!!!

Thu, 10/24/2013 - 18:13 | 4088221 Iam Yue2
Iam Yue2's picture

@Laspeyres: Equity investors pile into cyclicals but raw materials prices (real demand proxies) do not support their optimism. http://t.co/zDNY0uPYiD

Thu, 10/24/2013 - 18:18 | 4088222 BringOnTheAsteroid
BringOnTheAsteroid's picture

I'm a bit sick of the 'this time is different' meme. It is fucking different, very different. There is no longer any rule of law and there will be no limit to Central bank money printing and currency destruction. There's little doubt that every major commodity is a play thing of Wall st traders, that the US government and Fed are actively suppressing gold to keep the facade of the US dollar limping along. We're 'all in' this time people, there's no escaping. The only thing I can possibly think of is PM's as a back stop and a small amount of money riding the stock market tsunami. It will seem like a great ride until it hits land and then life as we know it will be over for some time. Of course if I was in the US I'd be arming myself to the teeth. A century of ever increasing greed is coming home to roost and with 7 billion people on this planet, fucking hell, it's going to be bad.

Thu, 10/24/2013 - 18:39 | 4088285 prains
prains's picture

yes but the unpredicability of that one grain of sand releasing from the pile and sending the enitire artificial edifice to the ground is still EXACTLY the same as it ever was, only thing different this time is the collapse is not sector contained, it's the entire Pythonian Slip and Slide Silly Walk this time.

Thu, 10/24/2013 - 19:18 | 4088406 cat_artist
cat_artist's picture

Yup. You got it. That red fingers of instability theory exactly matches what I see going on around the world today. It's like a red-line jungle out there.

cat

Thu, 10/24/2013 - 18:15 | 4088225 Meatballs
Meatballs's picture

It's bubblelicious, bitchez!

Thu, 10/24/2013 - 18:20 | 4088236 buzzsaw99
buzzsaw99's picture

Those buying on margin don't care about the long term consequences to OPM. All they care about is jamming it higher so they can get another bonus.

Thu, 10/24/2013 - 18:50 | 4088328 NotApplicable
NotApplicable's picture

Besides, they're using customer funds as collateral, as they have none unencumbered of their own to spare.

Thu, 10/24/2013 - 18:21 | 4088237 Shizzmoney
Shizzmoney's picture

I cannot wait for this thing to blow.  It is going ot be GLORIOUS

Thu, 10/24/2013 - 18:24 | 4088250 NOTaREALmerican
NOTaREALmerican's picture

Re:   It is going ot be GLORIOUS

It'll be a REAL doomer bummer when it turns out to be yet another GLORIOUS BTFD opportunity.

The world isn't just,  the assholes win.

Thu, 10/24/2013 - 18:50 | 4088334 GeorgeHayduke
GeorgeHayduke's picture

"The world isn't just,  the assholes win."

And the problem with the assholes always winning is they don't consider it a real win unless everyone else loses...big time. Hence the current situation they have built up for themselves.

Then we have the problem of the lesser assholes the greater assholes place between themselves and the non-assholes, like politicians, police, lawyers, judges, etc... and it all makes for one big asshole-filled mess. It'll likely be pretty shitty when it comes down.

Thu, 10/24/2013 - 19:15 | 4088399 algol_dog
algol_dog's picture

There's a lot of holes in that statement. 

Thu, 10/24/2013 - 18:43 | 4088302 Diogenes
Diogenes's picture

When the tornado hits the trailer park this guy will be out flying a kite.

Thu, 10/24/2013 - 18:21 | 4088242 Clowns on Acid
Clowns on Acid's picture

Of course, "this time is different..." Indeed it is....QE @ $85B / mth is here to stay, and was not here in the other peaks of margin debt in the charts. must e accounted for.....you are going to need a bigger chart before this is over...

Thu, 10/24/2013 - 23:11 | 4089035 andrewp111
andrewp111's picture

QE might be twice that rate before the Midterm election. On the other hand, the Fed might halt QE entirely if they think doing so would give the House back to the Democrats.

Thu, 10/24/2013 - 18:31 | 4088264 NOTaREALmerican
NOTaREALmerican's picture

I sent this link to the guy sitting in the cube next to me, he's learning to trade options from another guy.

He decided after review the charts that things will still go up, and he'll buy twitter.

Thu, 10/24/2013 - 18:50 | 4088335 NotApplicable
NotApplicable's picture

"Slam Dunk!"

Thu, 10/24/2013 - 18:50 | 4088333 nasa
nasa's picture

Tulips 5.0

Thu, 10/24/2013 - 18:57 | 4088347 ebworthen
ebworthen's picture

Looks like we have 6 months to a year and this next one is going to be bigger than the last one.

Meanwhile, retail investors with money trapped in 401K's and I.R.A.'s moving back into equity mutual funds.

All a part of the Wall Street Bankster Financial Engineering cabal's plan I suppose, with the blessing of Washington D.C. of course.

Thu, 10/24/2013 - 19:02 | 4088371 MeelionDollerBogus
MeelionDollerBogus's picture

My take from months ago, http://flic.kr/p/enJ7Cs , simply copying past patterns & layering with some re-scaling over recent activity

Thu, 10/24/2013 - 19:08 | 4088382 blindman
blindman's picture

it only works if you are too big to fuck up,
like the insurance industry or a bankster
with low friends in high places or high friends
in low places.

Thu, 10/24/2013 - 19:10 | 4088389 algol_dog
algol_dog's picture

I'm curious about the way margin debt in those charts are configured. Is a snap shot in time, or more like a weekly/monthly agregate? If I, as a day-trader, am in and out of the markets daily using margin, is that included in these figures?

Thu, 10/24/2013 - 20:02 | 4088517 noless
noless's picture

I assume intraday negative net margin would be another chart altogether

But i don't trade in the same sense that you do.

Thu, 10/24/2013 - 19:13 | 4088392 yogibear
yogibear's picture

The Fed banksers have an ocean of QE money to fill this bubble more. 

Ya never know how big you can make it with all that liquidity. Water balloons get pretty big before they burst.

Thu, 10/24/2013 - 19:38 | 4088462 Julian
Julian's picture

Bernanke better look out, look what happened to Michael Jackson after he blew Bubbles! :)

Thu, 10/24/2013 - 19:41 | 4088472 autofixer
autofixer's picture

Oh was that the name of his little Terrier?  Now I remember, Bubbles!

Thu, 10/24/2013 - 20:03 | 4088521 Wilcox1
Wilcox1's picture

Heh, I think I'll belly up and swap my Caterpillar stock for the twitter offering.  Like you said, I can't lose

Thu, 10/24/2013 - 20:40 | 4088613 Randoom Thought
Randoom Thought's picture

Based on my understanding of the facts, they still have at least a year before the bankers decide to crash the stock market. There are no free markets.

Fri, 10/25/2013 - 00:21 | 4089192 Nobody For President
Nobody For President's picture

Calling the Black Swan - Honk, Honk!

The market CAN stay irrational longer than I can stay solvent shorting this bitch.

But something is gonna happen to break this bubbulacious babe, and not even Uncle Ben and his printer can plug the dike.

I am, however, gettin' tired of waitin'...

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