So, How'd Your Day Go?

• So, how'd your day go?
• Life's busy here at the Fun Factory, but I had to get something in about the market crash. Seems like the response to the failure of the bailout package had somewhat of an impact. 
• SOMEWHAT!!!
• Did you notice a wider spread between bid-ask today?  I saw that on the IWV it was like close to 1%.  No way.  Is that normal for that ETF? Or is my quote system mucked up?
• Who knows where this is headed.  If a deal gets signed, does the DOW rally 700 and the Nasdaq go up 10%?  If not, do we go down 3000-4000 points and retest the September 2002 lows?  Or is the market just having a fire-sale panic today, that will create big gains down the road for buyers, as did the 1987 crash?
• One thing for sure, is that this stock market action just has to be crushing any chance McCain ever had of winning in November.  Obama may win all the electoral votes at this pace!
• I remain long, but I've ridden this sucker down for quite a bit of this journey.  I continue to dollar cost average in, and today was looking at locking in some tax losses and rotating into other like-kind investments.  Will need those tax loss write offs in the future when Obama raises taxes on us, after all.
• Anyways, for a glass is half full view, see Michelle Malkin's column, Some Perspective for the Chicken Littles.

Roll Tide Randomosity

• Hopefully, you were able to watch some upsets in college football today.  I watched the first half of Alabama's manhandling of Georgia, and also saw Michigan's second-half comeback against Wisconsin.  And who didn't like to see Florida lose to Ole Miss?
• Looks like a financial bailout deal is near!
• If you watched the debates Friday night, you probably are wondering why Obama and McCain were arguing over what Henry Kissinger had to say.  Kissinger responds.
• Powerline comments, "As far as I can tell, the pundit class judged John McCain's performance about as favorably as could be expected."  ...  "Yet most of the early polls I saw indicated that the public viewed Obama as the winner. Why the apparent disconnect? Because, I think, while commentators tried to focus on how well the candidates debated their respective positions, the rest of the audience focused, naturally enough, on how much they liked those positions."
• I agree with that comment.
• Foreigners cast the majority of votes in MSNBC's online poll following the debate.
• 3BlueDudes with a database of electoral map projections.

Friday Gold Rush Randomosity

• The market continues to do whatever as the financial networks focus on whether or not the bailout will happen today, tomorrow, or this weekend, next week, next month, next year, or at all.  
• Oh... San Francisco 49er's cheerleader (Gold Rush), Daffne.  She's from Peru!  And if you picked up SF QB JT O'Sullivan for your fantasy football team, that wasn't such a bad deal.  I didn't...
• Understanding the impact of the iPhone.  And the impact to Microsoft and RIM.
• John Jansen has a nice line up at Seeking Alpha on President Bush speaking on the bailout.  I was reminded of a line from a Beatles song which went, “I imagine that she is a very nice girl but she hasn’t got a lot to say”. He just does not have much to say and in this event, sadly he is not in control; events are.
• Greenspan says that the economy will suffer if Congress doesn't act.   I wonder how bad it would be?  We've had such excesses this decade with the stock bubble and the real estate bubble.  You almost wonder if we need to go through a health restoring recession instead of trying to float our way through it via government intervention?  I really don't know.
• JP Morgan predicts California home prices to crash 58%.  I don't know, but we're close to 40% already in some places.
• I liked JP Morgan on The Gong Show.
• Barry Ritholtz says $700 billion is just the start.  I tend to agree, as I figure government financial projections tend to be off by a factor of at least three.
• What would Greg Mankiw do if he were a member of Congress?

I Need a Beer

Been a little under the weather the past few. The head cold is making the rounds through the Fun Factory.

But I could use a beer.  It is Friday!  I think this is Haruka.

I don't know what's going on with the government bailout plan.  I heard Harry Reid use the opportunity this morning to praise Obama and blast McCain.  Not that I respect Harry Reid much to begin with, but what a little person he is.

Not to give McCain or Obama a pass on this. I'm getting really tired of their antics as well.

Is it too late to start a national campaign to write in Hillary Clinton on the ballot?

Anyways, I think all charts and indicators are useless here until there is resolution on the bailout.  Any short-term trading is just gambling on what the next news release will be.  With that in mind, I'm updating my portfolios.  I'm closing the NDX short (PSQ) in the long-short timing model and going to cash until this is resolved.  It had a nice ride.  In addition, I'm closing all positions in the Black Box Jr. model, too. 

Dancing with the Bailouts

• Well, the bailout is struggling on Capitol Hill as Congress tries to pork-it-up with things outside the original scope of the President's proposed plan. Thus, stocks crater. 
• At least that's my reason du jour.
• But Heroes returns tonight.  As does Dancing with the Stars.  Hello, Carrie Ann Inaba!
• I have a slight cold.  Great way to end Summer and bring on Fall.  Cough.  But I'm toughing it out here at the less than Fun Factory.
• Another dismal fantasy football weekend.  I keep losing games by 3 points and get absolutely nothing from my starting QB.  I've gone 3 weeks without a TD pass.  Losing Tom Brady basically destroyed my season, and I need a Fed bailout!  Hank?  W?  Senator Obama?  HELP! 

More TGIgp Randomosity!

• More TGIgp Randomosity. The pick is from Grace Park's FHM shoot. Ahem.
• Grace Park, Tricia Helfer, and some of the other folks signed to do a Battlestar Galactica movie.
• McCain and Obama tangle over the Wall Street crisis. 
• McCain says that he's no expert on the economy, and that while he was a POW in Vietnam, he had to issue his stock market trades by tapping Morse code on the walls of his cell.
• Obama says that he has no specific plan at this time and won't try to seek political gain from the crisis, but as community organizer he often times had to come up with creative funding ideas when money ran short.  "Why not have a bikini car wash?  Or sell some candy bars for $1?"
• Who can forget Grace Park's role as "Asian Dancer" in the 2000 movie "Romeo Must Die?"  Or as "Female Breeding X5" in Jessica Alba's Dark Angel TV show?
• Ron Paul (never pictured) on the Global Financial Crisis. 
• Lots of blame for the financial crisis.  How far back does it go?  Jimmy Carter?  Bill Clinton?  And did George Bush try to increase regulation in 2003?  Read on....
• Don't Worry About Inflation. 
• For Grace Park, it must be tough being of Korean heritage, and playing every Asian role under the sun except for Korean.  I wonder what a Japanese actress thinks when a Korean actress gets cast as a Japanese character?  Just asking. Anyone? Anyone? Buehler?
• A new world order - by way of 1000 point swing in the DOW.

TGIgp

• Learning Curve favorite Grace Park for Friday!
• The market has had just an amazingly volatile week. Welcome to the People's Republic of America.  Basically, it looks as if the government is going to bail out "financial companies gone wild" with something near $500B to $1T of YOUR cash.  I'd think that this will hamper the government's ability to spend much money on new programs in the years ahead.
• But the stock market was up huge again.  If one is waiting for an IBD confirmation day 4-10 days after Thursday's gains, it might be a little frustrating on the sidelines.
• So, at 0-2, all of my Fantasy Football running backs are questionable this weekend with gimpy hamstrings and toes.  Good grief.  First Tom Brady goes down.  Then my backup (Houston's Matt Shaub) has a Hurricane Bye Week and I'm stuck with Miami's Chad Pennington from the waiver wires.  (Might as well just not even start a QB).  It's as if my fantasy team needs a Fed bailout.  Just horrible.

The Incredible Amazing Market Reversal

• Well, the market staged an incredible reversal after learning that those Bill Gates and Jerry Seinfeld (neither pictured) commercials are ending. Taking a shower with your clothes on?  Just not that funny.
• And this is Anna Torv from "Fringe."  I'm not sure about that series.  A little creepy.  Too much goo.  But still on the DVR schedule.  Not sure I like it or dislike it.  It may get the bump as other series gear up.
• So what does Yahoo Finance have to say about today's market reversal?  ...the combined influence of an announcement prohibiting short selling in the U.K. and reports Treasury is considering a plan to create a Resolution Trust-like operation as a solution to the financial crisis stimulated huge buying interest late in the day.
• I had Fox Business Network on, and Liz Clayman was pretty giddy as the market advanced.  Paraphrasing, "Wow, look at it now.  It's up even more since I finished that last sentence.  And there it goes again, more after that sentence.  This is amazing.  Oh, there it goes again.  The more I talk, the more it goes up."
• Yahoo Finance missed the Clayman effect completely.
• Everyone is talking about the market now.  Family.  Coworkers.  Talk radio shows.  Radio shows about gardening.  Everyone.  Everywhere.
• I heard a caller today say that the economy wasn't that bad.  "I just stood in line for 3 hours to buy an iPhone," he said. 
• I kind of agree that the underlying fundamentals are okay.  But that's not what is in the headlines.  And those running for office will continue to berate the economy, no matter what.
• Somebody called in a radio show around 10am PDT saying that he sold everything this morning and went to cash.  Oopsie.  Missed that end of day scorcher to the upside.
• Even Obama and McCain are talking about the economy.  Eh, it was more fun when it was all about "communty organizers" and "lipstick."

More AIG

"Never outlive your money!"

Did You Have a Nightmare?

"Buddy, we're with AIG." LOL.

The McCainberry

• Who knew John McCain (not pictured) invented the Blackberry? I think it should be called the McCainberry.  And now that I know it's the official cellphone preferred by neocons, scratch my plans to get an iPhone!  Where do I get in line?
• Well, stock market is collapsing again.  "Credit fears."  No new signals on the Black Box Jr., and the Long-Short Model is still short the NDX via the PSQ exchange traded fund.  That was a good signal.
• None of the traditional or historical trends are in play these days as the news headlines are driving the market.  All related to the collapsing of the real estate bubble and bad mortgages.  I think I certainly underestimated the impact of this, as far as the extent of the ramifications to banks and the market goes.  And with financials being 20% of the SP500, the ramifications are large.  At least, they used to be 20%.   Maybe less now?
• Overall, outside of bad mortgages affecting banks, I think most folks are doing fine and the economy is stronger than what is in the news headlines.  At some point, the fear will subside.  When?  That's the big question.

When Banks Cry Randomosity

• Just a thought... Apollonia Kotero.
• HP to cut that workforce like they mean it! 7.5% cuts over the next 3 years.
• Well, when life gives you lemons, you hire ex-HP employees and open up lemonade stands.  Franchise!
• Market modestly up as I type. I think we'll all in some shock about it all.  Basically a retest of the July lows, with new lows though.  Yeowch.
• And nothing but doom and gloom chatter on the news and blogs now.  Both presidential candidates swearing that they'll fix it.  Uh-huh.
• Porn coming in second after social networking sites.  "...surfing for porn had dropped to about 10 percent of searches from 20 percent a decade ago, and the hottest Internet searches now are for social networking sites."
• Sell signal still on at Jason's.
• I missed the Investor's Intelligence numbers last time, but Headlinecharts has 'em.  Longer term investors have to like this bearish newsletter sentiment.  This has been a really long period of bearish outlook by newsletter writers, nicely setting up for the next market bottom.  From a contrarian point of view, this data is highly favorable for stocks.  Of course, this was from friday...
• More later...

Market Tanks

• Well, we did sell off into the close. And easy to guess that the banking stuff carries the day.  US home prices falling, folks upside down in their mortgages, etc.  And it continues.
• Maybe we all just thought it was normal for people who made $30,000 a year to buy $500,000 homes.  Turns out not to be the case.  There were, uh, reprecussions to this "all in" Texas Hold'em real estate market.
• Anyways...  There is some market seasonality stuff to pay attention to, but not sure it will apply in our Financial Armageddon.  First, we have the options week expiration.  Next, is the Seasons in the Sun model which sells in the Spring and buys in the Fall.  Maybe the latter is setting up this year.  Hasn't been a great performer recently, though. 
• So I'm trying these Tofurkey slices in a sandwich for lunch.  Kind of a strange aftertaste.  I think I may have eaten my last Tofurkey sandwich!  Bleh.

 

Banking Panic of 2008

Watching CNBC this morning, it was as if everyone was expecting whatever sell off to amount to an incredible entry point into stocks. Yes, a capitulation and reversal was the expected outcome of the Banking Panic of 2008.

I was looking for that, too.

Yet, after the initial tankiness, we rallied some but are now again selling off.  The big clue will be the end of day action.  Will it be bought, sold or move sideways into the clothes?

While the financial news is grabbing the headlines, most everyone I know went off to work today and seems to be riding out the turmoil in stride.  This still seems mostly a result of the mortgage bubble, and for most of us we just work and continue to make monthly payments on our homes.  We lost a few hundred grand in home equity the last few years, but we weren't among those who cashed out and spent money on cruises, cars, or remodels.

Behind the scenes, we're all getting a "tax cut" as fuel prices continue to fall.

Ain't that nice?

The Long-Short model is still long the PSQ (inverse NDX) and doing quite well today.  Yes, it is at extremes.  And with that in mind I was going to sell some today and raise cash positions, but will wait on that to see if we do get a real panic soon.  And if we do free fall into the clothes, I will sell partial to book gains.  (Still just paper trading the long-short model, FWIW).

Futures

Bleh!

Well, tomorrow morning should be interesting. Panic?

Saturday Morning - Pray for Texas

The damage from Hurricane Ike looks extreme. And this was just a category 2 hurricane. Galveston looks wrecked. You know it's bad when the Hooters gets torn down. Houston is flooded from the surge.

The Red Cross and Salvation Army are good ways to help out.

Price gouging in gas prices? Refineries may be shut down for a bit.

Helicopters will go out soon to look for people.

Houston Chronicle coverage on Hurricane Ike.

TGIF - Pray for Texas

• I'm watching Fox News as Hurricane Ike bears down on Texas.  Lets say a prayer for the people in Texas.  It's just wicked looking.
• Why would folks stay in Galveston and ignore evacuation warnings?  Are they trying to pad the statistics?  Crazy.
• Stock market continued to whip around ahead of options expiration week.  I haven't paid too much attention that last 2 days.
• On the long-short model, I would note that I've tweaked it a bit to recognize extreme levels.  It's in the extreme area now with the long PSQ position.  The portfolio has made good money in PSQ during the sell off.  Yes, still just paper trading it.  But with the extremes, I'm going to take some profits in PSQ next week.
• Well, work is crazy. Bosses are talking with folks and urging them to cancel vacations. We have so much work right now.  But with threats to employee's vacations and weekends, I think we'll have some turnover soon. 

Melissa Lee or Sarah Palin?

• I'm not a follower of fashion, but something about this picture of Melissa Lee today seems quite trendy since the past week or so. 
• It's the glasses!  It's the biggest women's fashion trend to hit since wearing the bra on the outside of the shirt!  Sarah Palin rockin' the fashion mojo.
• I'll never understand TV.  Journeyman gets cancelled after 13 weeks, yet Happy Hour on the Fox Business Network goes on and on, day after day, week after week.  Oh, and year after year. 
• I fell asleep after typing in "week after week," and when my head slammed into my monitor, I was able to regain consciousness and finish my thought.
• Nothing against Rebecca Gomez' legs or anything.
• Market caught a case of the buzz kill heading into the close. Hey, it finished up a little.  I guess we have that.
• I'm still 100% long and riding the trendless back and forth action.  Anyone have motion sickness pills handy?

Left Coast Lunchtime

• Lunch time here on the Left Coast, where not only is my veggie burger about gone, but Barack Obama (not pictured) is fading faster than you can say, "the Oakland Raiders defense." McCain up by 5%.  Who would've thunk it.
• Raiderette Irecel.   Irecel is attending the Fashion Institute of Design Merchandising where she is pursuing a degree in Merchandise and Marketing. In the future, Irecel wants to become a buyer for a large high-end clothing store.  I think a "large high-end clothing store" is different than a "high-end large clothing store."
• Just a reminder, Gail is running to raise money for cancer research this weekend. She's close to her goal.  Help if you can!
• We hear a lot of this and that during the campaign.  Is anyone factchecking?  Yes!  Factcheck.org!  How did they come up with that name?  Anyways, they're keeping track of Sarah Palin,  Barack Obama, and John McCain.  The political-slight-of-hand trick is to take quotes out of context.  All of the candidates do this to each other, while "the victim" cries outrage and then turns out another negative ad.  Same Same Same, every election year.
• Meanwhile, in the markets... Saudi Arabia says "Whatchu talkin' 'bout, OPEC?"  And say that they're not planning on cutting back on oil production.  Gold is down.  Nasdaq up, according to FBN, that RIMM's Blackberry assault.  New products and such.

Lehman's Assets Randomosity

• Lehman selling off some assets?  Lehman Brothers, in a desperate bid to survive, announced plans Wednesday to sell a majority stake in its prized investment management business and said a sale of the entire company was possible.  Trading range today all over the board for LEH. 
• Fox Business is asking about LEH and financials, "Are we at a bottom?  Lets ask Rina Akiyama.
• Well, you can't put lipstick on WM and pretty it up, but it's still a pig.  Another big drop today.  Big losses.  A "fresh" 20-year low!  I bet it doesn't feel so fresh if you're long that one. Calculated Risk has more in WaMu Cliff Diving.
• Sirius XM extends losses.  I still can't figure out the viability of subscription radio.  We have iPods and others that can store gigs of music, podcasts, etc.
• Adam Warner on the AAPL news yesterday, the Steve Jobs health issue, and some ways to play Apple.  I say bake 'em in a pie and serve with ice cream.  Sure seems like the tech company has reached its zenith in innovation. 
• OPEC is cutting back production by 500K barrels over the next few months, and seems energized to try to drive oil prices up.  I hope that we (the US) continue to conserve and choose higher mileage vehicles.  I also hope that we (the US) do go ahead with plans to increase domestic supply, and start a program to increase other energy sources such as wind, solar, nuclear and natural gas.  T Boone Pickens plan to use natural gas in cars is a valid idea.  Even if it's just another option at the fuel pump and car lots.   Whatever we can do to decrease the use of crude.  Especially, foreign crude.
• And BREAKING NEWS from Fox Business News...  Russian strategic bombers land in Venezuela!  Somehow, world tensions seem to be on the rise and we're vulnerable in the energy arena.  Just saying.

Stock Market Tears ACL; Out for Season

• Returned from a 4-day weekend in Reno Monday night. Kind of exhausting, but fun.  Spent the bulk of the time in a sports book trying to predict the future.  Just like stocks except with football teams.  Did well with the pros, but not so well with college.  The 1/2-point hook kept wrecking my tickets.
• I tried to keep up with some of the Fannie Mae and Freddie Mac news over the weekend.  I wasn't sure if it was a good thing or a bad thing for stocks.  You'd think it'd be bad.  And it was for the shareholders of those companies.  Wall Street rallied yesterday, but the Nasdaq was relatively quite.
• I think that divergence in the Nasdaq was a sign that all still is not well.  And watching CNBC this morning, with groggy eyes, I noted that future anticipated tech spending is down as well as future hiring plans.  And with Russia playing the Venezuela card

BREAK

• So I started this blog entry this morning, and the normal work chaos ensued so this is the first time back in my office.  The market tanked into the close.  The sell signal from the Long-Short model from a few weeks ago has been a winner. But this market sure is grinding

Grody to the Max

• So, I'm trying to find a picture of the New York Giants cheerleading squad, thinking they don't have one and I was right. Their website says:  The Giants do not have a cheerleading squad. We have always felt that the game should be the focus of the day of game presentation.  Losers.
• Instead, I give you Azusa Yoshizuki.
• What can I say about yesterday's market?  It was grody to the max, Moon Unit.
• Today's unemployment numbers are also up.  I think unemployment is a lagging indicator as companies react to the slow growth in previous quarters.  Although, the 2nd quarter GDP was just revised upward to 3.3%.  Hiring has slowed in both the private sector and public sector.  Governments are dealing with lower than anticipated tax revenues.
• Government tax revenues are also a lagging indicator.  We file taxes for the previous year, so if the previous year was slower then the checks coming in reflect that.
• With GDP revised upwards, I think the economy is turning around.  And the fear in the market is probably a pretty good buy.  But, I've been long for awhile while the market has been in this trading range.  There have been some opportunities to catch the wiggles in this sideways action, but I haven't done much of that.
• The good news is that the new Long-Short model is working well with the sell on the NDX last week (long PSQ).  No new signals on the Black Box Jr. model.
• I caught most of John McCain's speech last night from the Republican convention.  I thought it was fine.  I'd really like to see them pound the energy issue.  We need a lot more nuclear, wind, solar, and oil.  I think energy independence should be the #1 issue this year.
• Posting has been a little light.  Work is very hectic and doing lots of house stuff in the evening.  Not much PC time for me.

GOP Convention Randomosity

• While I didn't watch the Republican convention last night, I did catch a few clips of Fred Thompson (not pictured) on Youtube. It's not that he did great or not so great, it was just so... I don't know.  Tired.  Who the heck cares?  All of this is just a sideshow before election season anyways.
• Well, VP pick Sarah Palin's speech tonight holds some interest after all the media and blog attacks on her and her family the past few days.  Wow. 
• Anyways, the market's reversal yesterday was pretty ugly.  Today was less ugly, but still not pretty.  Behind the scenes, the US dollar has been rallying and oil has been falling.  The 2nd quarter GDP was revised up from 1.9% to 3.3% in last week's news cycle.  So things are actually looking a lot  better under the covers.  But we probably won't see too much of this sort of thing in the news headlines.  Just be aware that it is happening.
• Looks like the New York Giants are giving 4 points to the Washington Redskins in Thursday night's NFL opener.  It's in New York.  I guess the logical choice is the Giants.  But everyone is so down on the Redskins that I'm leaning the other way and predict a close game.  I would take the 4 points. 
• Oh, the pic is of Sora Aoi.  Ahem.  She's on some video game cover, so I did a Google search.  Turns out that she's a Japanese adult actress.  Ooh lah lah.

Compounded Disappointment

• Well, this year's fantasy football drafts are over. Lots of preparation based on last year's statistics and hype what players will do in the next few months.
• Kind of like reading charts and predicting future earnings.  And even with all the charting software and latest company info, the next thing you know, your stock gets released and then signed by the Detroit Lions.
• Today was a very ugly day for the bulls.  What started out as optimism over the UCLA overtime win over 7-pt. favorite Tennessee and collapsing oil prices , turned into a huge reversal.  Even Yahoo Finance seemed baffled:  There was no apparent catalyst for the change in sentiment, although the retreat may have been compounded after traders were disappointed that stocks were unable to maintain their opening gains.
• There you have it:  Compounded Disappointment is the reason.  Got it!
• I remain long and weary this market.  Seems like it's forever stuck in the funk.  It won't be, of course.  Right now, all in the media headlines is negative news.  I expect that to remain during the campaign season as the Democratic ticket is running on how this is the worst economy in the history of the planet. 
• Sarah Palin makes the VP slot on McCain's ticket.  The Governor of Alaska is an interesting choice.  Doesn't make or break the ticket for me, as the opposition party is planning on raising my taxes if elected.  Why would I vote to tax myself more?  I'd rather spend that cash in Las Vegas than give it to Washington DC. 
• Hey, have you watched the Sci-Fi show Eureka?  I've had 20 episodes sitting on the DVR forever, and powered through a few this past week.  I like it.