Complete Stock Idjit

OK, now we all have a bloody nose, now what?

Rating: 3.00 not yet rated(6 votes)    Vote:

You are logged in as | Logout

If you went long you screamed in agony last week, and if you went short - you screamed in agony this week, now that all of us are bloodied - what do we do next?

Hope there's some porridge that's neither too hot or too cold?

Fat chance.

I had a lot of movement the last couple of weeks, nothing new really - just repositioning what I currently own into a different mix. If memory serves I've done that twice in the last 8 days, and been burned badly at every turn. I went contrarian yesterday with POT and MOS down 11 or more - adding $35,000 today as a result. I'm not buying any drinks because that barely covered the hit the shorts took (QID, SDS, SKF and SRS) - so it was cheerful, but not decisive.

It's a "sharp blade swung by madmen" - and there doesn't seem to be anything you can count on other than there will be a lot of movement in one direction or another. Safe havens don't seem to be available, and curling up in the fetal position seems to be the only defense.

I can't tell you what to do, I can't tell you what's coming next - about the only option left is enduring.

The web site is damaged horribly and I cannot tell whether the folks that aren't playing are where they're supposed to be - but if it's somewhere near where they are currently, that itself is telling. If you took your money and didn't invest a nickel - you'd be in 20th place.

Pretty sage advice from where I'm standing - as I have little to show for being the "canny" investor. You won't hear that type of advice from your broker, but it's looking better than anything offered lately.

Unrelated Stuff: Cheer's to Vad for assuming the lead in the Strategy Lab, it's nice to see someone offering something other than the tired old choices that are fast going nowhere. Traditional council in an extraordinary market has little value - and Vad is not taking the staid conventional route by any means.

KB
http://singlebarbed.com

Comments: 4

BIDU? Isn't that like fiddling while Rome burns?

Rating: 3.00 not yet rated(5 votes)    Vote:

You are logged in as | Logout

With nearly everything "taking it in the shorts" I'm less inclined to take a long position on anything, especially a high valuation "Internet Darling" like a search engine. GOOG is the preffered entity in this space, and it's decline from 714 to 446 speaks volumes.

The Question of the Week is better suited on a broader topic like; "which Fast Food restaurant has the coolest uniform" (because I'll be working there next week) or "which soup kitchen serves Cambell's Noodle" - times are grim, and most pundits are missing the big picture.

With a hot stock growing cold in a single day's trading, I'm not looking to increase my long position with anything. It's not pleasant, but Bear Stearns has thrown the gauntlet, and it appears what everyone has pretended wasn't happening - is happening.

I'm sure they'll be a brief uptick as a result of the FOMC meeting this week. If so, likely I'll be trimming my long position by 20-30% selling into the 120 minute rally that results. John Markman's piece this week suggests it's prudent to do so - and I'm thinking he's right.

It's not about timing the Market, as that's beastial hard - it's about not being the last guy holding the bag.

KB
http://singlebarbed.com

Comments: 6

Principles and Convictions hurt like hell!

Rating: 2.33 not yet rated(3 votes)    Vote:

You are logged in as | Logout

Now I know why all the great Zealots in history came to painful closure, the living was easy - but them principles and convictions hurt like hell!

I've been steeling myself since last week, figuring on a "Dead Cat Bounce" when the FOMC met today. I practiced grimacing in front of the mirror - bitter beer face, scrunched up and puckered... I knew what was going to happen, and resolved myself to the beating I would endure - swearing one oath after another, "You WILL NOT buy, YOU WILL sell..." - and with all that effort and all that practice, it was still a hideous, painful experience.

Mr. Market soaring 400 points is supposed to be a time of rejoicing, you call your favorite gal, spring for an expensive dinner and rejoice - firm in your conviction you're a financial Jedi.

Me? I'm laying in the gutter next to an empty Gin bottle uncaring whether I'm stepped on - as nothing could be more painful than vanishing 100K in 24 hours. Long hours, minutes lasting an eternity...

It's odd that "going long" and getting confirmation is righteous armor, but "going short" and enduring the result is no armor at all. You're standing naked as Wall Street erupts in laughter - with half the NYMEX pointing at you, holding their gut. You're hoping it's merely your zipper that's down, but when you check you'd wished you hadn't...

Would some floor trader throw me his badge so that I can cover myself? ...

I stuck to my guns, and endured the pain - purchasing only more SKF (Ultra Short Financial) as it was down over 20 points. By then I was over the self concious thing - and the hilarity that resulted when I placed the order was something I could tolerate - what's left to hide when everyone's seen Mr Winky?

I tried to summon enough courage for one defiant, "..well, You're all wrong!" but it came out like a Volkswagen beeping at the crosswalk, a plaintive, whimpering, "bleet, bleet" - that makes the target merely giggle.

I kept flashing on all them saints and martyr's we've read about - wondering if they had the same hollow feeling as the flames started licking their feet. I surely don't know what the future brings, I've made my bed and am content to play out the hand, but the stern look I'm wearing is all bluff.

I'm still short, and growing shorter.

KB
http://singlebarbed.com

Comments: 2

Two kinds of emotion, and I need to fear both?

Rating: 2.33 not yet rated(3 votes)    Vote:

You are logged in as | Logout

In the first six months I learned to invest with torch and sword, ruthlessly pillaging companies and industries, sucking them dry, then discarding them like so much useless baggage. I was Attila the Hun - parents frightened their children with stories of the carnage I wrought on the investing landscape..

I was merely attempting to rid myself of the emotional ties "winners" build in your portfolio.

Meek little lamb by night, turning into the "Butcher of Bear Stearns" at the first hint of the Opening Bell.

It worked well enough, and I was convinced I had learned all there was to know about "Emo's" and how they rode a stock up - then rode it back down again.

Last week was chilling, and as I watched my financial empire tumble about me - I discovered I was a victim of a second, more insidious form of emotional tie ... knowing what's going to happen next.

It's a hellish liability, enough evidence has accumulated to give you an unshakable feeling about what the next quarter will hold - that you ignore what's happening today. A setback is merely a "blip" and things will be made right with tomorrow's market, only tomorrow is worse.

You wake up one morning and realize you're bucking the entire market - and while the walls of the Alamo still stand - you have to ask yourself, "how in hell did I get here?"

The pundits called it a "margin call" of the Hedge Funds - who promptly unloaded all of their winners because they couldn't sell the crap that caused the problem. Now my kids are looking at City College rather than Harvard, virtually speaking...

It was a fun ride and I learned a thing or two; conviction is as big a problem as emotion, it doesn't matter whether you're right or wrong, too much of either is a liability to an investor. This market is a "cut, slash, riposte" market - and you need to be agile and unfettered of any of the normal investment dictums, get in and get the hell out.

If that's unappealing, you shouldn't be here in the first place - as letting yourself get crosswise with these blistering trends makes you a food group.

No need to fret, you're not alone - I'll be there shivering when the predators get close.

KB
http://singlebarbed.com

Comments: 0