Market Swooooons

• It's bear on roller skates accelerating downhill cartoon time.
• Normal end of August swoon?  The much-expected retest of the previous lows dead ahead?  As I mentioned awhile back, I wasn't going to get fancy with trying to in-and-out a retest on a day-by-day basis.  But should we get below 1400, I will increase beta by rotating some holdings around.
• I don't believe it's a bear market.  I think it's just a low-growth environment.  The Fed went a little bit too far with their rate hikes, and combined with higher energy prices folks are seeing less money in their wallets.  And less equity (if any equity) in their homes as home prices fall hundreds of thousands of dollars.  Employment is high and wages are growing, so folks will keep spending what they have.  But I can't see growth accelerating much at this time.
• Adam Warner in a fundraising walk for the benefit of the Friendship Circle.  Check it out.
• Maybe folks should spend less money on food.   Americans fatter than ever.
• A whole football season where the broadcast booth will be talking about Michael Vick.  Good Lord no.  Vick is even commented on in the canned recordings for Madden 2008 on the Nintendo Wii, PS3, and XBOX 360!  Not really, but could you imagine that going on as you're trying to figure out which combinations of buttons to press to send the WR in motion?
• What's up with Apple? from Barrons.  Wondering why APPL getting smoked today compared to the market overall.  I'd file it under "the harder they come, the harder they fall."  Check out FXI, BIDU and FSLR, too. 

End of August Murderous!

Well, in the previous entry I quoted from another site that the pre-Labor Day week was the strongest. When I arrived home, I checked the Stock Trader's Almanac.

"End of August Murderous 6 of last 10 years. Average loss last 5 days: DOW -2.6%, S&P 2.3%, NASDAQ -2.1%."

"Next to last day (of August) DOW and S&P up only once in last 10 years."

There you go. More for the mental blender.

Labor Day Move On Deck?

• Looks like it was the stock market that turned in its resignation papers today. After a nice (but low volume) move last week, we begin this week with some selling.  More scary thoughts on housing and real estate catch the blame today.
• It's tempting here to game a Labor Day move.  "Week before Labor Day is the most positive of all National Holidays for traders."   But I'm already 100% long!  We'll see how that Playbook Rule works.
• I didn't think "Thank You for Smoking" was THAT great of a movie.  Netflixed it over the weekend, and I was hoping for something more funny or dramatic.  An okay flick, but certainly not worth blowing $9 at a movie theater for.  That's when you feel like you've been robbed.  I hate that feeling when walking out of a theater!  "They stole my money."
• I've watched some pre-season football by DVRing it, and using the 30-second advance button like there's no tomorrow.  Skipping the mind-numbing Michael Vick comments and watching play after play.  I usually just watch the first teams play; so, two quarters of football and I delete the recording.
• We're going to hear from Ben Bernanke later this week.  Lord only knows what he'll say about inflation this time.  The only thing consistant about the Fed's comments on inflation is their inconsistancy.  Flip floppers.
• And finaly, here's a Universal Health Care proposal that none of the 2008 Presidential candidates are talking about on the campaign circuit:

 

Jesus Is My Health Insurance

I tell you, people these days have lost their faith. Everybody's turning to the television or drugs or the government to solve their problems,...

Seeing the Ex-Girlfriend

• Do you get reflective when running into someone from the past?
• I went to the California State Fair today. As I was hanging out in the shade somewhere, a hot Japanese girl walked by.  HEY!  That used to be my Japanese girl!  Sure enough.  Her and I dated for two years.  I ended it for all the wrong reasons.  She's girl #2 on the list of "the ones that got away."
• So now I'm just reliving those two years in my head.  It'll bug me for a while.
• The market had a nice week.  I think the volume was a little light.  It seems like everyone is expecting a retest of the previous lows in September/October.  The thought being that the retest will be bought with fury.  Seems like those waiting for a dip to buy get bearish on the dip; those waiting for a bounce to short get bullish on the bounce.  It's tough to go against sentiment.
• Last week of August on deck.  I imagine volume would be light as folks get that last vacation in before Labor Day ends. 
• I have a few fantasy football drafts this week.  No need to bore you with the details, but maybe this will take my mind off the ex.  LOL.

Ventriloquism is BACK!

• Ventriloquism is BACK! Ventriloquist Terry Fator was crowned the winner of NBC's America's Got Talent Tuesday, beating out reggae crooner Cas Haley, beatboxer Antoinette "Butterscotch" Clinton and country singer Julienne Irwin for the million-dollar prize.
• And that's one of the reason for my diminished blogging the past few.  Yes, I went out and bought a sock puppet and have been practicing my ventriloquism.  I am typing this whole blog entry WITHOUT MOVING MY LIPS! 
• Well, ventriloquism and 7 hours of meetings everyday this week.  That may have something to do with lack of blogging.  Just haven't been near the PC.  In addition, summer nights.  In Sacramento these days, we have The California State Fair.  So I meandered down there last night in the 100 degree weather for a while.  Not bad.  Not great.  Kind of the same thing year after year.  But it's kind of a "must do" in the city.
• The market actually looking good from the "low" on thursday.  This is post-options expiration week, and one would expect that the market would take a pause ahead of the month-end stuff.  But with the dramatic swings in recent weeks and what looks to be some sort of panic capitulation last thursday,
• As I type, the market just sold off a bit and is a smidge in the red.  I remain 100% long.  Not doing much here.  The possibility of a retest of the previous lows is in the back of my mind, but I'm not sure I will try to game that sort of thing.  I believe I have pretty good entry points on my positions.  Pessimism was rampant last week with folks wondering if their money markets were safe or if they should make a run on the banks.  Put-call ratio was unbelieveable.  The buy signals in the Black Box happened last week, too. We've moved up quickly from that panic, so backing and filling would be normal I'd think.  But that's hard to trade.  For me, anyways.
• Okay, the meeting parade continues.  And the ventriloquism practice.  Did you see me moving my lips on this blog entry?  Huh?  Did ya?

Monday's First

• I suppose the IBD theme here would be to look for a follow-through day in the market starting either tuesday or wednesday.  Today we're drifting down a little.  Investors were concerned early that the Fed didn't inject enough liquidity into the market today. 
• I remain 100% long and just watching.  A little nervous with the rest of August and the whole of September bearing down on us, but I think the economy will be fine.  And we all know that the Fed will now cut rates next month.
• Lots of fear and pessimism out there.  Lots of volatility.
• Oh, for what it's worth, I fired up the Black Box this weekend.  It's been mostly quiet the past few months after a sell signal in May.  Anyways, it had lots of buy signals on the index ETFs and on my favorite large caps last week.  Especially on thursday.   Combine that with the widespread fear and market volatility, and I think that makes me feel more bullish.  Even though I'm "all in" as they say in Texas Hold 'em.
• Watching way too much pre-season football.  I'm not sure why.  Lamont Jordan had a decent game for the Raiders, but I wouldn't consider him for the fantasy football team, you know?

TGIF (And Ziyi Zhang!)

• "May you live in interesting times," goes the (alleged) Chinese proverb.  We have had that with the stock market in recent weeks.  Today, the stock market gapped open as Fed Chairdude Ben Bernanke road in on the white horse and cut the discount rate.  The forces of darkness countered with a fade, claiming that if Bernanke is doing this then something must seriously be wrong with the economy.  But in the end, the forces of good won the day.
• What side do you think Chinese actress Ziyi Zhang is on? 
• I'm not going to change my views that I've had the past 2 weeks.  I'm a bull here and believe that the wild volatility and extreme pessimism are presenting us with a buyable correction within a bull market.  I remain 100% long.
• You know, the new TV season is right around the corner.  No more of this weak summer cheese they're throwing at us.  
• XBOX 360 version of Madden 2008 better than the Sony PS3 version?  You know, the XBOX 360 also wirelessly connects to the web and lets you stream video content from your PC.  PS3 doesn't do the latter.
• The Naked News will go on:

The government made grants totaling 400,000 yen ($3,500) to help cover production of the weekly five-minute program on satellite TV, which features a newsreader who removes her clothes between news items that she delivers in sign language.

The funding dried up when the government, under fire for supporting "Naked Sign Language News," changed funding guidelines for programming aimed at the disabled to exclude pornography, local media reported.

Hey, one man's pornography is another man's news.  Naked News, that is.

The Fed (and Madden 2008 on the Wii)

• Wow. So the Fed steps in and gooses (geeses?) the markets this morning.  We have a gap up, but then a major fade.  Still 3 hours to go as I type, and it'll be interesting to see that final hour.  I like the CNBC comments this morning that some of the options players might be getting spanked on the gap this morning.  Hey, what if the opposite of yesterday happens in the final hour?
• I'm 100% long and not watching the ticks today.  Just letting it flow.
• Cam Cameron and the Dolphins went for the 2-pt conversion to save us all from overtime with the 3rd string.  Very merciful, Cam.  I taped the game and FFed through it.   I couldn't stand all the Michael Vick talk.  It was just horrible.  So I watched the game in well under an hour.  Skipped ahead 30 seconds after every tackle.  What a great way to watch a game.
• Played Madden 2008 on the Nintendo Wii afterwards. I was initially disheartened to see #8 Daunte Culpepper quarterbacking the video game Miami Dolphins. 
• Mentioning Daunte Culepper to a Dolphins fan is like screaming "Satan!" in a crowded church. 
• "I rebuke you demon quarterback spirit, in the name of Dan Marino!"
• I played the "family mode" for 5 minutes and racking up 21 quick points on a halfback toss to Randy Brown for 74 yards, then a 80-yard pass play from Lucifer (er, Culpepper) to Chris Chambers, and finaly a bunch of short passes from the unholy one to various receivers.  I decided I needed to see what else the game had to offer.
• I went online and registered with Electronic Arts for online play.  The good news?  ROSTER UPDATES!
• When I returned to the Dolphins in advanced mode, Beelzebub had been replaced by at QB by #10 Trent Green.  Ted Ginn Jr was on the team, too.  I went through the practice drills, and then played the Jets.  I'll need to spend some more time with this one.  Pretty fun.
• TGIF.

Stir it Up

• Just to stir things up, the market was sinking like a stone and then late in the day staged an impressive rally.  Of course, the market is extremely oversold and due for a bounce.  But will the bounce be shorted heavily?  Just like bulls on the sideline waiting for a dip to go long, when the market is tanking the bears on the sidelines look for a bounce to go short.
• I remain long.  I obviously don't have a crystal ball and don't know when things will turn around.  But I do believe the fear creates an opportunity.  We had many corrections in the late 1990's, and those were some pretty good years to be long.  Folks just forget that corrections and pullbacks are normal.  We haven't really had much of one in recent years.  So this just seems scarey.
• Depends on one's timeframe, too.  I'm focused out there a ways.  In my trading account where I'm long an ETF, I may get more aggressive on stocks that I think will do well going forward.  I don't want to give out ticker symbols, but I think solar energy isn't going away.   I think the internet is going mobile in a big way over the next few years.  I think the big banks are going to be the big winners as the smaller mortgage companies get in trouble and go out of business (reduced competition).  I think the newer video game consoles are selling well, and kids (and adults) need games to play.  I think folks will need health care going forward.  Etc.
• Oh, I bought the Madden 2008 football for the Nintendo Wii.  No, haven't played yet!  Maybe tonight.  Oooh, there's a pre-season Dolphins game, huh?  Eh, uh, we'll see.
• Trying to pick out a name for your baby?  This one didn't fly, but I like the idea:  @
• If you want give your kid some flexibilty, you could name her after a month.  She could spell it out, as in "September."  She could abbreviate it as "Sep."  Or she could use a number, like "09-".  Dash or slash.  Her choice.
• I had a Countrywide home loan once.
• Man, I do want to watch that game tonight.  I might have to pick up a pizza.

Engine Room? More Power!

• With a market like this, Scotty needs to figure out a way to get the warp engines back on line. Impulse power isn't pulling us away from the gravitational forces (fear) of the credit markets.  Today was just ugly.  Major selling commenced late and was relentless. 
• The bear thought is that we're heading lower on this "new leg down" of a  bear market.  The SP500 is now below the 200dma.  Heck, the SP500 is now negative for the year!
• One bull thought might be the complex four-standard deviation move in the VIX.  Might have to fire that one Adam "The VIX Man" Warner's way to get his thoughts.
• I remain bullish and believe that we're in a bull market and corrections are an opportunity to increase aggressiveness.  I don't think the credit woes are a big deal, and that we're just returning to a more normal credit environment.  Remember, it was only a handful of years ago that you actually had to have a down payment in addition to good credit in order to buy a home.  We're returning to that.  No more 103% loan-to-values on a negatively amortized stated-income loan to cover the home price and the closing costs.  Those days are gone.  GONE!
• In addition, the big banks are fine.  They'll take (and have taken) a hit on this.  The big banks are diversified creatures.  The result of this will be less competition as many of the small mortgage companies go out of business.  Just thinking ahead, and that C and BAC "may" be long-term winners from here.  Not a recommendation.
• But it's all about fear right now.  Forget about fundamentals.  Forget about GDP and corporate earnings growth, low inflation, low unemployment, and rising wages.  Oh, and the four-standard deviation move in the VIX?  Forget about that one, too.  The headlines are only reporting the bad news.
• Well, Larry Kudlow likes to report only the good news.  Calls what's going on a "Temporary Power Outage."  Wall Street remains caught in a tizzy over a power outage in the credit markets. But Main Street is in fine economic shape, according to the latest reports out of Washington.
• Well, I do think things are bad for Mattel.  What parent will have a Mattel toy at the top of the Christmas list?  Don't you think that every kid who sits on Santa's lap will ask for "a toy not made in China?"
• Bloggers film under skirts, due in court.  Two Dutch news bloggers caught filming under women's skirts in a car park in order to warn the public of the intimate views afforded by see-through stairs must appear in court, according to their blog.  Drat.  There goes one idea for my "second career."
• Man, so busy I forgot that Madden 2008 is out for the Wii (as of yesterday).  Something to do. I'm going to go pick it up.
• Where did the time go this week?  Holy smokes.

Monday (sigh)

• Yeah. Monday.  Didn't know what to expect after reading the fears and concerns vs. the large shouts of "buying opportunity!" over the weekend.  Even with the late-week action last week, the week was positive.  Normally, I'd say that options expirations weeks can be volatile, but with the action last week I think I'll just sit back and watch.  I remain long and didn't make any trades or re-positioning moves today.
• Financial system in jeopardy!  Trying to break Ken Jennings' record.  Financial Sense with their normal gloom and doom scenario.  Always good to know the worst case scenario.
• I tried to watch some pre-season NFL over the weekend.  The highlight had to be Daunte Culpepper floundering around for the Raiders.  Hey Al!  Sign me up for the minimum and I'll give it a try!  (Ah, bitter Dolphins fan.)
• Adam Warner 'splains why the futes were up like crazy delicious, but the market inched ahead this morning.  The cool part was the heads-up from AW yesterday.  That way, we all got to watch it unfold.
• By the way, have you stopped by Adam's Friendship Circle website to check out the charity event?  Every little bit makes a difference.
• Karl Rove resigns at the end of August.  Yeah, but did he say August of what year?  Bwahahahaha.
• Speaking of the Miami Dolphins, I noticed in the boxscore that Ronnie Brown had 8 carries for 8 yards.  Makes Edgerrin James look like a breakaway artist.  (Edge averaged 3.4 yds per carry last year for 'Zona).  Unless the NFL changes the rules to give teams 10 downs to make a first down, the Dolphins might need a "Plan B."  Ronnie Brown also had 1 reception for -1 yard.  He's a dangerous dual threat!  No doubt that kind of performance will force the defenses to be honest this season.

F.E.A.R.

• Maybe in retrospect, we'll see that the stock market is in a trading range. We're at the same place we were last week.  Although, the market is being a huge drama queen this week.  Big swings!
• We're ahead of options expiration week.  The playbook says to buy any weakness ahead of options week.
• With the "fear" out there, I can't imagine many will want to be long ahead of the weekend.
• It is also August.  A poor stock market month historically. 
• All of that is in the mix.  I remain long here.   But it sure is tempting to try and trade the whippage.
• I fogot about the pre-season game last night.  SHEEZ. 

Black Thursday

• You'd think it'd be Black Thursday the way the CNBC dynamic duo of Mark Haines (not pictured) and Erin Burnett were talking about the futures pre-market.
• Oh, check that. Just looked at the market as selling picks up here.  Another hedge fund fiasco.  These days, if one blinks one misses a 200 point move.  Financial having a rough go of it, and tech stocks selling now, too.  Eh, any selling ahead of options week may be a buy.  I remain nearly 100% long here.
• Hey, a shout out to Adam Warner.  His family participating in a fundraising walk to benefit the Friendship Circle.  Check out his page for more details. 
• Madden NFL 08 for game consoles will be released August 14th!  I'm hoping to avoid throwing my Nintendo Wiimote through the TV trying to get that Dolphins' passing game going!  The Wii is so engaging, I may also have to avoid getting a concussion behind that Dolphins' offensive line.   Just like Trent Green!

In Edit: As Jeff noted in comments, what about the podcast for folks with an iPod? The podcast is now available at iTunes! Click the link to open iTunes to the podcast page.

Rally Rally Rally

• The market is rallying strongly as I type. It doesn't mean the final 2 hours will continue this way, but I had to chuckle at the Yahoo Finance commentary:

Buyers remain in complete control of the action; but one has to wonder just how much sidelined money is actually coming into the market or how many margin calls are giving the market an added lift.

• Their point may be valid.  But it was just last week where the margin calls were working in the other direction and driving the market down!  LOL.
• For those who wondered how the Norm Fosback month end strength game played out, by buying the market at the close of July 27th and selling at the close of August 7th:

QQQQ:  July 27th close:  47.99; August 7th close:  48.31.  Gain:  .6%.

SPY:  July 27th close:  145.11; August 7th close:  147.77.  Gain:  1.8%.

• Easy!

Barry Bonds Hits 756*

• Barry Bonds hits 756* to break Hank Aaron's record. The nation would've loved it more had he done it honestly.
• The market had a nice day.  IBD called monday a "follow through day" rally because of it being a strong 4th day after the rally last week.  Maybe that one deserves an asterisk, too; friday was quite the sell off but the DOW didn't violate the lows.
• The Fed didn't really say much new.  The intial reaction to the statement was a sell off that was readily bought.
• Cisco had a great earnings report after hours, and maybe that'll juice the market some more tomorrow.

Muckdog Podcast

Muckdog's podcast

The stock market has corrected over 8%. The show highlights some views from others and includes my view on where we've been and where we're headed.

Click here to get your own player.

Also hosted at: Wildvoice.

Also hosted at: Talkshoe.

Got an iPod? Click this link to see the podcast in iTunes and to download to iPod.

Bernanke to Ride in on White Horse?

Many are looking to Tuesday's Fed meeting for a rate cut, hints of a rate cut, or any other commentary that may sooth investor fear.

clipped from www.ft.com Those hoping that the “Greenspan put” lives on in his successor are likely to be disappointed. Ben Bernanke, chairman of the Federal Reserve, has made pretty clear in the past that he does not plan to ride in with interest rate cuts to save the markets from themselves. Instead the Fed will take its decisions based on the economic data. A cut in short-term interest rates this year is not yet a foregone conclusion. But the Fed can expect to be back centre-stage, starting from this week when all eyes will be focused on any comments it makes about the impact of rollercoaster markets on the economy.

Look Out Below!

• Look out below! The stock market dropped large today as it stair-steps its way to $0.  Or so it would seem.  I'm down close to 2% on my buys earlier this week.  I remain 100% long.  When you're catching falling knives, you better hope they're butter knives.
• A new bear leg down?
• Will the Fed cut interest rates because of the mortgage crisis?  The mortgage crisis that's shaking capital markets could encourage the Federal Reserve to cut interest rates, economists said this week. Problems in the subprime mortgage market have spread into other parts of the home loan market, causing the private, secondary mortgage market to freeze up. That's limiting the availability of some home loans.   I don't believe it's that wide spread.
• I think this is the weekend I turn bullish in the Tickersense poll.
• President Bush to expand War on Terror to include Global Warming.   I suppose that means expanding wiretapping to try to find out who hasn't switched over to compact fluorescents.
• Joe Paterno ready for another football season.  At age 80, with a 16th grandchild on the way this fall, Paterno said Tuesday he's feeling swell and has no immediate plans to abdicate as he enters his 42nd season.  He's "feeling swell," Alfalfa.

Thursday Quick Hits

• The market closed... up! There may be some folks out there thinking that this is just a dead cat bounce or a countertrend move to the "first leg of the decline" in a new bear market.  I'm not so sure.  We are still in the monthly strength period, but I do believe the economy is stronger than what the naysayers claim.  I remain nearly 100% long after the buys earlier this week.
• Could be in for a trading range. 
• Culpepper a Raider.  LOL.  You think that offensive line is any better than Miami's last year?  And Pep was having trouble throwing before his injury, back with the Vikings!
• The next Tickersense poll coming out soon.   Look at the percentage of bulls in the July 30th version.  Sheez!
• From Alphatrends, Bottoms are a process.
• Jordan "The Wrath of" Khan believes the oversold bounce will continue.
• Housing Panic looks back at the real estate bubble days of 2004-2006.  My favorite comment here is "they're not making any more land!"
• Michelle Malkin notes that John Edwards seems to be basing his campaign on himself being the candidate who hates Fox News the most.
• Barry Rithotlz notes that Apple has sold 3 billion tunes via iTunes.  The iGolden Arches of music!
• Crazy busy at the Fun Factory.  When the late afternoon hits, my eyes are seeing double on the computer monitor. 
• My thoughts and prayers go out to those in Minnesota.  I was glued to the TV last night watching the news coverage.  Incredible.

Free is a Lousy Business Model

Can't make "free" up on volume...

clipped from www.iht.com NEW YORK: Time Warner said Wednesday that second-quarter profit had gained 5.2 percent on higher cable revenue, but shares dipped after sales at the AOL Internet unit plunged 38 percent. AOL reported its worst sales drop since adopting a strategy last year to replace paid subscribers with free e-mail messages and advertising. Revenue from divisions that include the Warner Bros. studios and the HBO cable network also declined. To counter declining Internet-access subscribers, AOL started offering e-mail and other services for free last year to lure users and advertisers. Parsons, 59, hired an NBC veteran, Randy Falco, as chief executive of AOL in November to carry out the free-service strategy. The division, based in Dulles, Virginia, has since upgraded products such as its instant messaging service.

Volatility - A Milton Bradley Game

The market bounced around more than a Thai bar girl today. Every time I looked it was on the other side. Big buying came in during the last half hour, which send the indexes on a surge. I'm still long from the other day, with very little cash. The market held where it had to hold. So far! And this is the monthly strength period...

Blogging has been light and I haven't had a chance to read news stories or other blogs. Things at the Fun Factory have been crazy the past week or so. I know you wanted to see a picture of a Thai bar girl. But instead, how about a link to a video? Gratuitous Dancing Girls.