Good morning

After stock markets have held up bravely in the face of the credit crises and mounting economic woes, a combination of renewed concerns about the financial sector, a record-breaking spurt in the oil price, and a rotten unemployment number claimed their toll on Friday, triggering a sharp sell-off in most parts of the world.

Read all about this in my weekly review, highlighting some thought-provoking news items and quotes from market commentators during the past week.

Here is the link to the “Words from the Wise”: http://tinyurl.com/6c8tkp

Enjoy the read.

Kaimu - What do you believe is motivating Chinese investment in the US? Perhaps they have an interest in maintaining or expanding US trade levels, therefore preserving growth of their economy?

Profit and sustainable commodity supply for the worlds largest population! They will be buying U.S. resources with a highly valued Renimbi while the $USD sinks.....

Think back to the 70's/80's and the Japan fear.

Same deal, different financiers, only this time it's far more serious.

MCD - Will the rainbow room jump today?

Craig - The first resource that pops into mind is Coal.

And oil, timber, other vital mineral wealth, maybe water, fertilizers, etc.

They have to look after a lot of people.

FXP club: any thoughts on what to do next? Since the Chinese market is closed, the reaction to Friday's US selloff would come tomorrow, with an initial drop in FXP today. So it would seem to make sense to sell - if one is inclined to sell - tomorrow. Alternatively, given the negatives in the news - oil prices, continuing credit woes, monoline downgrades, etc. - maybe it's worth holding on???

It's Not a Dollar Crisis: It's a Gold Crisis
http://tinyurl.com/42m2sq

Cara 100 Update:

NOK - Downgraded to Neutral @ AmTech Research

Israel yesterday attempted to play down a warning from a senior government minister that an attack on Iran was "unavoidable" if Tehran continued to develop nuclear weapons. The transportation minister, Shaul Mofaz, a key figure in Israel's dialogue with the US on Iran's nuclear programme, raised the prospect of a unilateral Israeli attack against Tehran on Friday, adding that international sanctions had been ineffective.

The threat, which is at odds with Israel's support so far for an international campaign to curtail and, if necessary, confront Iran's uranium enrichment programme, contributed to frenzied buying in the financial markets, where oil prices soared to a record $139, and sparked an international furore.

Yesterday, Mark Regev, a spokesman for Israel's prime minister, Ehud Olmert, said that "all options must remain on the table", adding that "tangible steps by the international community" were needed to "put pressure on the regime in Tehran".

Defence officials criticised Mofaz, saying his comments would make it more difficult for Israel to convince the international community to intensify its efforts. Political rivals accused him of exploiting Israel's fear of Iran for political gain.

A spokeswoman for Mofaz, Talya Somech, confirmed that he had been quoted accurately. She said Mofaz was expressing "his own opinion".

Israel's deputy defence minister, Matan Vilnai, said Mofaz, a former defence minister and a contender to replace the scandal-battered Olmert, had turned

dcr baby

craig- TBT/ROM- nicely done...now you can leave for the airport ;)

SUN @ 41.34, TSO @ 24.48...

I dunno about SUN and TSO, 2nd. The charts say you're trying to catch a bottom. Good luck, tho.

VLO @ 45.89...

vinod- trying a little UAUA @ 8.69...

n2s- i never catch the bottom...and i'm not trying to catch anything...just playing hot potato...;)

2nd: ROM/TBT out, in on QID....

adding to SMN at 27.29...

didn't enter yet

Bought HL and SIL. Expect short covering.

2nd
will wait untill market makes up it's mind
I will buy airline if they hit their 52 week low

look like naz which is strong is trying to catch up to dow

Cara 100 Final Update:

GRMN - Target raised from $55 to $59 @ Wedbush Morgan

MCD Jump back out

Bush to press Europe on Iran sanctions
By Daniel Dombey in Washington

Published: June 8 2008 17:25 | Last updated: June 9 2008 09:48

US President George W. Bush will push Europe to step up financial sanctions against Iran when he travels to the continent on Monday in what is likely to be his last extended presidential visit to the region.

Amid signs that Tehran is accelerating its nuclear programme, Mr Bush will lobby European Union leaders to build on recent United Nations sanctions against Iran, take speedy action against Iran’s Bank Melli and further reduce both export credits linked to Iran and financial institutions’ dealings with the country, according to US officials.

EDITOR’S CHOICE
Comment: America is unwise to deny Iran’s key role in the Gulf - May-27EU to tighten screw on Tehran bank - May-15US alerts banks to risks of Iran support - May-12Iran-Europe gas deals anger Washington - Apr-30How Iranians are avoiding sanctions - Apr-14Tehran demands apology over sanctions - Mar-27The US is also keen to deter any further European energy companies from signing deals with Tehran. Switzerland’s Elektrizitäts-Gesellschaft Laufenburg signed a 25-year contract with the country this year. Washington wants to prevent companies such as Austria’s OMV, which signed a Memorandum of Understanding with the national Iranian oil company in April last year, from following with deals in Iran’s natural gas sector.

http://tinyurl.com/593z3u

Come clean LEH!

Your thoughts.

I am a long time reader - My interests are in reading all of your comments on the big picture of the market and Bills thoughts on Industry trends, his longer term ideas and especially his Cara 100 lists and discussion on relationships between interest rates/dollar/stock/economy/gold etc.

I suspect there are thousands of readers like my self that come here every morning for the above. Most of us rarely post.

Many of you use this venue as a chat room to talk specific stocks/entry exit points/ etc. Some of you have other agendas - such as posting links to other sites that might serve up information similar to this site.

It only takes me 10 minutes to wade throught the other stuff; so, if I am the only one that objects to the above non-cara stuff, then I will shut up. But, knowing that Bill and Team Cara already have a full platter and do not need another project, maybe there would be some easy way to separate the stock picking stuff to another thread and leave everything else on this - the primary market commentary thread.

Don't shoot the messenger - I think this subject was discussed last year - just would like your current thoughts. Thanks, Wayne.

dcr not moving right

Opened positions in:

SWC @ 12.56
TSO @ 24.12

Wayne - I say feel free to contribute pertaining to items which you prefer discussing. What are your feelings / observations on rates, dollar, stocks, economy, gold? Are there some aspects of these which you might wish to discuss?

DCR WTF

Firewall translator - Converts to TLA. :~)

hey guys...oil be down, dcr and DUG also down?

Hey 2nd ave...your sale last week of dcr at 1.43 was close enough to the top...

DCR going out of business RIGHT NOW!

what's up with the divergences? DCR and DUG down while oil down? That means the oil stocks are rallying while oil drops.

How about GOLD stocks up too while POG is down.

I may have been early with my LEH calls but they're October and likely the bad news is out for a few weeks with them.

Rob.

wabrew
Re: The daily chat- Off Topic and 'Nuts and Bolts' Trading;

Yes, there's an argument for separating topics, but I wouldn't change it.
I've come enjoy reading everything here, trivial or not.
OT gives color and depth to people behind the posts. Without it, my screen would just be a bunch of yellow Post It Notes. The Scroll button works well for me! And there's a search function on the homepage that can help.

Weekends and late nights tend to draw the most OT; from the US Constitution to debates on the ingredients of mascarpone, it's all good!

Nuts and Bolts Trading: lately, some great sharing of ideas and perspectives.
I don't know about you, but I'm trying to undo twenty odd years of bad habits, such as lack of trading rules, lack of discipline and failing to
disengage emotions from trade rationales(and buying bulletin board 'story' stocks!)
My transformation has evolved through the discussions around Bill's dual objective: trading prices and social equity. It's all here.

safe trading.

Stu

Washington Mutual is collapsing - down 10% both Friday and already today. If we have a large savings and loan fail I would expect to see some panic come into the market as all the people that believe the "credit crisis is over" propaganda will start to think they are wrong.

DCR reversal.

wabrew

Agreed, better to keep this stuff on topic - maybe other chat can be done with twitter, IM, skype, blah blah blah.

Thank you.

Looks like GOLD stock lags physical.

maybe...maybe not

We've had this discussion numerous times.

If it's related to trading equities/bonds/gold/ etc. then isn't it on topic? Stock picks are on topic.

The only difference is timeline and this blog caters to many approaches and timelines.

DCR - From the WSJ:

"their final trading day will be June 25, with the final distribution made on July 3.

Many Oil Up investors could have done better elsewhere. U.S. Oil Fund, an ETF that similarly tracks West Texas Intermediate crude oil but without the complex structure, is up 102% in the past year, compared with 60% for the Up fund shares.

Meanwhile, holders of MacroShares Oil Down have gotten slammed, down 84%, as oil prices have surged."

wabrew, I agree with kp. I originally came for the long view and anything Bill chose to write. Bills comments were more numerous before he quit retirement. But now, I find the daily trading comments helps define/refine my investing skills. And I find the traders comments to be another view of whats happening right now. Bill says a thousand pair of eyes has a better view. This is not a slam on you. Please tell us whats of interest to you. You will get feedback.
Peace from North Puget Sound

There's a lot of info here....some useful to me and some not so useful. I try to look at as many as I can and learn as much as I can.

For those I'm not interested in I went into my mouse software and sped-up my scroll dial.

I can scan the first line and decide as fast as the one liner stock picks whether it's something want to explore a little deeper. It takes little additional time and sometimes it is valuable and I learn something.

Can anyone explain the Valero (VLO) intraday chart today at approx. 9:44 EST?

My IB chart shows a tick going from $45.90 to $46.90 in one long, very quick quick jump. Then back down to short ticks.

Is this a misplaced order, or was some big money trying to blow out short-seller's stops, was the plunge team at work?

Blog site: no posting allowed unless specifically requested by audience?

See ya later!

Does anyone else here think that Icahn's involvement in this YHOO/MSFT thing is a little bit ridiculous. I assume that Icahn doesn't give a damn what happens to these companies as long as he can make money on the deal.

Its sad to think the fate of all the employees involved is firmly riding on the money man Icahn's mud slinging. Someone needs to get a muzzle on this guy.

I for one am not convinced that a merger is the right thing for YHOO. I think there is a good point to be made (by Yang, etc) that there is some very long term intrinsic value in YHOO, even if profits have been slow to develop over the last few years.

YHOO is a seriously nice piece of internet real estate.

2nd
CAF is down even though market there is closed today

Vinod -

I'm with you for the moment. Closed out my puts at the opening today and I am keeping on the sidelines for the moment. Still long OPTT, some foreign bond funds and XLE but reserved for the most part.

Someone asked what possible plays might be coming up. I'm thinking about using the CPI data on Friday. That number, no matter how cooked, is not going to be pretty. Maybe some short plays on high end retailers or other inflation sensitive sectors.

I should note that I am currently long a put on JWN but I got in at a support level (a good hard knock on the head seems to be the best way to learn!). I am also wondering what the retail sales data will look like. Currently, JWN is estimating a repeat of April (something like +4.0%).I'm holding on to it until Friday. Maybe I can close out even.

Thoughts? Other ideas?

anyone considering getting long gold, even tho there should be a short term drop?

Wow...Oil's down and DIG is up and DUG is down?

WFT?

Just bought some GSS

jeremy, just took small initial position in DGP - planning as a long term holding.

Bullion dealers calling me. One offers an allocated storage coin-based IRA. Told me a numismatic coin trading more than 5% over spot would not be a target to be seized, should that happen again. ?? Will check the lit out fully.

If Iran turns into a crater, Gold will jump. Doubt that will happen with public comments first.

We should see resumption of the EW wave 3 down this afternoon or Tue, IMHO & RM's, which should weaken the dollar and drive up gold.

B&P, the men in green, will no doubt pull something, but I think it will be ineffective.

Schiff: ..."My guess is that currency traders will ultimately see this as an act of desperation. When the dollar keeps falling a chorus will swell to demand that the Fed put teeth in its new policy. If Bernanke does nothing the world will finally see a naked emperor and the dollar’s decline will turn into a rout. If, on the other hand, the Fed raises rates to defend the dollar, and only a short term bounce results, then all remaining confidence in the Fed’s ability to support the dollar will evaporate as well. This is probably Bernanke’s greatest fear and is likely the main reason he waited so long before mentioning the dollar. The fact that he felt compelled to do so now likely means he knows the game is coming to an end. Got gold?"

GSS: Started at market perform at Raymond James, $4 price target.

Jeremy -

You might want to think of partial allocations on weakness. This way you don't guess at the bottom but buy some on each bout of weakness and will have a very good average price.

If we get a large savings and loan failure the dollar will take a major dive, no? The way some of these stocks are behaving it may not be that far away.

miners have a nice day along side some sideways action in gold. a welcome change, that i hope turns into a longer term trend.

but today the priority is the 2:45 kick-off between Italy and Holland.

hopefully italy can put take an early lead and let the dutch beat themselves as usual!!!!!

forza!!!!

I know some here follow solar companies. Has anyone looked at Carmanah (CMH-T) lately - took a big drop over the past year but seems to be turning around...local Victoria company here on the island

Any thoughts?

Who'd have guessed that oil would be down 2.50 a barrell at 1 pm and DCR would be at 55 cents?, down 40 percent.

Nice reversal in DCR...not.

anyone liking it at 50 cents?

Bailed, DCR at a loss. Price paid for messing with something with fiat value.

Reloaded the DIA puts as the next move, and DXD.

with gold going neg I'm gettin out of gss for now

ALOHA!!

wabrew ... The name of this Blog is "CAPITAL MARKETS AND SOCIAL EQUITY ... perspective and discussion. It's not just "STOCK PIKS-R-US" ...

This question keeps getting raised many times and as Bill has indicated in the past there is an unshakable link between politics, monetary policy and stock markets. Even today if you read Bill's comments on oil producers. What is he saying?

I persoanlly do not mind all the stock picking posts nor do I mind all the political posts or any other posts. I try to bring the perspective of "money" and its value which is the basis of all financial transactions and eating. Problem is that our monetary system has been so debased that it takes more than one income now to maintain lifestyles that were supported by one income back 30 years ago!

Many here are "stock pickers" trying to leverage their "wealth" to stay above water and actually be able to retire someday. In a fiat system all you can do is leverage risk ... the "wealth" part is of questionable substance since everything in fiat is DEBT based.

Good luck in your quest ...

adding to TSO/VLO/SUN (nice call on the early timing, n2s)...

vinod- yes, CAF is coming to us...

gss looking even better looking 2 get back in

back in gss

"SAN FRANCISCO (MarketWatch) -- The dollar ticked higher against its major counterparts Monday after Treasury Secretary Henry Paulson said in a CNBC interview that he would never take the option of foreign exchange market intervention off the table.

The euro was buying $1.5637, down from $1.5691 earlier Monday.

The dollar index (DXY:US Dollar Index Future - Spot Price Last: 72.96+0.57+0.79%

1:15pm 06/09/2008 ..."

Men in green.

http://tinyurl.com/6zoace

I agree w/Kaimu "Capital markets AND Social Equity" is the name and the game here.
I did, however, have the same thought as Wabrew when I saw another post hawking another blog site, and like Wabrew I really don't read the stuff "in at $2.34" "out at $2.345" but I really don't mind it and others seem to be interested in it and enjoy it. In my opinion this is the best trading blog on the net. Most, but not all of the other trading blogs, really are a bunch of nonsense.
Also, Bill is right on about the big HB&B's and the funds running things up and then unloading in this bear market. They are like a machine stripping one group and then moving to the next.
They've done this in times past, but in my opinion this time they are out of control. You know what they say happens in the market to pigs!

[Bill Cara note: Thank you Watermelon. I cannot begin to speak about social equity without letting everybody come here and say pretty much what they want. But I try to set a tone that sets a standard, reminding people that I too learn from you as you do from me. There are some who post here probably in an effort to attract followers to their own blog, but you all understand that and if the quality of their postings isn't worthy you don't click on the links.

With regard to the market today, there are just a few stocks holding up the DJIA: Alcoa (AA), General Motors (GM) and McDonalds (MCD) are well ahead followed by Exxon (XOM) and Wal-Mart (WMT). Without these few movers, and without Apple (AAPL) forcing down the NASDAQ, both the DJIA and NASDAQ would be down maybe -1% so far today, which is better than anticipated following Friday's sell-off. But there is still 90 minutes to go and this could get interesting. There has been a +70 point move in the DJIA to 12270 in the past 10 minutes, which is probably not sustainable. The next wave of selling in the DJIA will tell us whether or not the Bulls are up to protecting their 12200 level.]

This action reminds me of August 2007 - an accelerating swan dive. We are running out of time for a relief rally.

shark-> DCR purely a mind-game at this point...i'm thinking about a red chip play...

SKF & QID holders are smiling again today.

House guests from Atlanta just arrived. They stated that the major highways are deserted except for trucks. I wonder how long it will be until the trucks stop running?

McHugh predicts a "waterfall decline". My view is from the American side.

Broke even on FXP after underwater for a month. I will hold it for a while longer. I bought DXD today with hopes the market falls the rest of the week going into Friday's CPI numbers.

BH- it's just a matter of time before oil has to come down...good to see you smiling...;)

DCR- shark-> red chip at 0.63...this Bud's for you!

Wave Energy/ OPTT followers;

article in The Economist, as highlighted at seeking alpha today.

http://tinyurl.com/3pz8l9

Allen

Still holding? This is the first time I been able to pull up the Comumunity web page all day.

I added more DUG this morning @27.
Holding SRS/QID/FXP/DUG

ESLR-> vinod, any interest at 9.17?

I agree with Kaimu

all the info on the blog adds in to help expand what we are seeing and the tone of the market. For myself I find all the discourse helpful, since in tracing a pattern, it all adds up to the final larger pattern we each are working against.

I think the trick is adding your own personal filters on how to use the negative information as well as the positive information. It seems to me, much of the information at any source in this culture currently more negative that positive so it's important to even review the side marketing spin offs to help determine any negative edge to work against.

Since much of the material in this blog I consider to be positive, it helps even more to get perspective to the negative.

Casey, I agree that the trick is to filter the info. I personally prefer when people try to stay on the topic of investments, markets and the economy, with a social equity concern as well. I don't mind a bit of stray philosophizing, and can take small doses of ranting. When I get beyond my limits for taoist philosophy, ranting and raving, I just don't read posts in detail. (Nothing against my Taoist friends intended here...)

QT, I'm gripping the edge of my desk, delirious to have recovered all my lost dollars. But while I'm feeling internal pressure to sell, my greedy side says "Hang on, China will crack tomorrow, and the negative news is still rolling in." What are you doing?

Allen: I consider it an honor when I get ignored :)

Seems like an end of day rally to leave S&P500 in the green would leave everyone pretty confused for tomorrow........

Allen

See I told you last week the closer you get to your cost basis the more pressure you would feel.
LOL..

I letting my FPX ride.

I am currently letting my SRS ride and I am up very nicely after passing my cost basis Friday. The only thing I regret [I ALWAYS DO] is I sold half of my position in SRS Friday fearing a pull back later in the day. If I would of held on to it, today would of been a verrrry nice day! But... I am in the green, for months it was BIG red numbers looking at me. So holding as made up for the pain and suffering.

Casey, I'm paying attention! Particularly if you tell me that FXP will go way up this week! Heck, I'll convert to Taoism if it goes to $110 again....

I've converted to Dowism. It gives me peace of mind.

I realized something the other day while watching Kudlow and Fox News for a few minutes each. There is a formula for disseminating official propaganda: get four guests - one who espouses the truth, three who attack him and a host who is biased against the truth. Then when the truth speaker talks he is immediately 'dicredited' by the other guests and biased questions (really editorials) of the host. I have seen this with the 'credit crisis is over' and 'housing is bottoming' memes. In the minds of the viewers who don't know any better and are looking for guidance, the truth has just been discredited and the counteracting propaganda is embraced. This formula has seemingly been developed with the help of psychologists.

This only works until their lying eyes can't help but see the truth.

BillySundance,
You may have it right. I could see a green finish

I still don't get why the oil stocks are cranking with crude down. Is DCR based on the oil stocks like DUG? It appears to be.

I'm thinking about some JAN DIA puts to offset my LEH calls in case everything really hit the crapper before October or even this week

Rob.

Craig: 2:0 at half time. Dowism = escapism? Feeling pain?

S&P green.....bear trap or last gasp that is the question?

I'm thinking last gasp. Why? Because I want it to be.

Apparantly the FED monetizing any garbage the HB&B to drag up to the FED window hasn't provided enough liquidity to keep the Ponzi going. HB&B must be desperate because the "we're fine today...we need another x billion tomorrow" is destroying any trust the average person has in them.

Anecdotal: I'm hearing a lot of average people vent they are tired of their 401k continuously dropping.

Great call Billy Sundance.

2nd, thanks. But the market gods are raining on me today like January in NorCal. PANL and ESLR down > 5% each.

Ouchies.

What did CT say about the NAZ? The bears would lose that bet too?

Note the QQQQ broke the trend channel to the downside, touched the 50DMA and bounced back to *under* the lower trend channel line.

Dowism seemed to work today. SKF was fun.

mebea 2nd
because of work I could not log on untill now
i am staying out untill thursday and will bet for friday's cpi on thursday.
do plan to load up on CAF/DUG and airline when price is right

Buy to Open Call 2 Contracts of -OEYFE
Order Number:F09BFRLK Details Filled at $8.00
Sell to Close Call 2 Contracts of -OEYFE
Order Number:F09BMBMX Details Filled at $8.50
Buy to Open Put 2 Contracts of -OEYRD
Order Number:F09BQGWJ Details Filled at $8.80
Sell to Close Put 2 Contracts of -OEYRD
Order Number:F09BZXVM Details Filled at $9.80

Anyone else thinking that LEH may be out of the woods for a bit?

My thinking about it is that everyone and their grandma had known since BSC went down, that Lehman carried a large amount of leverage in CDOs and their balance sheet was awful. Since Mar-17 the price recovered from mid 20s to almost 50. During that time, financial news media gave LEH barely any negative coverage. WSJ even ran a fluff piece on Eric Callan one day. Not a negative word in sight for weeks.

Then two weeks ago, financial news outlets began an LEH rampage and LEH has been on yahoo's finance headline page with negative stories for a week now. Einhorn went on CNBC to publicly bash the company while they were trying to finalize a deal to raise capital.

So given the situation at hand (and the suspicious timing of the financial news media) - were Einhorn and friends on the buying end of that capital LEH raised today? I.E. - did Einhorn and friends use today's LEH offering to cover their short positions before they drive it back up in order to start the whole deflating process again?

I will not be surprised if we see financial news media shut their yappers on LEH for a few weeks while the stock drifts back to mid-30s. Einhorn has these people wrapped around his fingers.

--------------------------------------

With that said I still think LEH is in a terrible state of affairs, but it may take awhile for it all to play out. In other words, I'm waiting to get short LEH again.

2nd
we will be able to buy ESLR under 9 this week

Still have some Jul 25 puts LEH. No confidence in the financials. WM was a joke today (June 7 put on them.) I think the HBBs are going to take another big hit now, and then the consumer-oriented banks later.

I got an offer and took money from BofA at 1.9%,
that I will use to bet against them.

Just as the Tax Rebate Checks come out, Dow down over 1000 and oil to $125+ is my guess.

Watermelon and others - Thanks for all your comments. Looks like I am in the minority. In the future I will read the more insightful posts (like moab's at 3:36) and others like it that I come here for (not saying that I agree w him) but this is the type of commentary I read - I'll just learn to set my elevator faster when I page through stuff I don't want to read.

Bill - thanks again for repeating your thoughts on why you want to keep the discourse open to everyone. And, thanks again for the time and energy you put into this blog.

Allen:

on FXP I don't track that stock actually now, I consider it too unsafe and unpredictable at the moment. SMN now is different matter: it's almost time to jump onto that wagon I think. I been holding off the past two weeks since I felt it still needed to play down a bit. I am also eying seriously PAL But again I think it will go down a bit more still. So I am waiting for the next spike in my jr's and then switching for a bit.

Craig: I suspect Dowism, is trying to teach everyone (1)to let go of all money ties soon, (2) your money is really someone else's money (3) It's all an illusion right now as it isn't even paper now a days: At least confederate dollars were worth the paper they were printed on, but who even has the paper now a days????

I much prefer Taoism , where I can still occasionally "play" with money but without attachment. At least I get to play

Finger Lakes, re: DUG and OIL...

Oil stocks are up (and thus DUG is down) today because on Friday when oil was up $11, the poor overall market dragged down the oil stocks as well. Today is just a rebalancing as now people didn't see a black Monday, so we still needed to price in a net of ~$6 of oil gains into the oil stocks.

Today is the adjustment day IMO, and tomorrow should see the return to oil down, oil stocks down, DUG up (or the inverse of each).

Karl

2nd/Vinod: Support for ESLR is just above $8.
I'll wait for it to come to me at support.

Vinod: I like ESLR

I read about how the credit bubble switches from one market segment to the next in order to float the problem and that how solar and alternative energy stocks were the next likely area to see this stock credit inflation.

It is just a question of when they play the game.

I have been slowly putting together a list of solar stocks for this reason. I am guessing: this is just my guess the time, to invest into the solar will be after Bill's TOG and stock correction.

I am betting ELSR will bounce down closer to its next support level of 8.2 low after another oil correction in the next few weeks. But that's just me.

ESLR/FSLR - To me it seems alternative energies float with oil. If oil continues dropping, investors take less interest in alternatives. The other factor of course is environmental change. When/if governments make progress on adopting environmental controls then alternatives will step up.

BillySundance,
Regarding LEH. That's pretty much my thinking too. Add all that to the fact that they cannot have another major bank or brokerage collapse before the election or these financial problems will be the main issue and not high energy and food prices(which I'm sure the candidate would much prefer to campaign about).

Long LEH OCT calls bought 1 day too early so far.

Rob.

KarlN,
That makes sense. I'm assuming that's the same reason DCR was down so much. I was tempted to buy at the .59 price but didn't pull the trigger.

Rob.

Casey Kochmer /Craig
I am in total agreement with you that ESLR will go down to its support
Thanks your reminding me

2nd,

Sorry for checking out awhile. I bought and sold some DCR also, but not as well as I would have liked. Should'a loaded the boat at 50 centavos. Instead, I got in a little higher, good size, got out higher still. Will rebuy tomorrow if oil's going down. This thing's a fun trade if you're not on the wrong side:)

"Allen: I consider it an honor when I get ignored :)"
Posted by: Casey Kochmer [TypeKey Profile Page] at June 9, 2008 3:05 PM

You can always tell when you're talking to someone with high self-esteem and nothing to prove...JMO...

2nd ave:

:) RAFLMAO

it keeps me honest. Ego sucks and being ignored is great medicine to remove such a pesky beast. I was wondering if someone would catch that.

Casey Kochmer

" I consider it an honor when I get ignored "

I consider this is the best post of the day
I follow Dalai Lama and his teaching.

Bank of Canada makes their call tomorrow,
possible 1/4 cut. i dont see why they still feel the need to cut,
then again our govenor is an unelected agent of a large US bank.... barf.

Recent gains in the market: VERY concentrated -

I just looked at which Media General industry groups are UP since the S&P topped in 10/07 (just 3 of 31!):

* Chemicals, of which only AG chemicals were up (23%)

* Mining&Metals, of which only the following were up:

- non-metallic mining (mostly potash) up 36%
- steel&iron up 29%
- industrial metals (minus copper&aluminum) up 11%
- gold up 2.47%

Aluminum, copper and silver were down !

* Energy, the following sub-industries were up:

- drilling&exploration +50%
- independent oil&gas +36
- major integrated oils +0.27%

Pipelines and refining&marketing were down ...

Most people probably invested most in the (flat) integrated oil companies. Many (we included) probably focused WAY too much on gold ...

The other 27 media general groups are all down since 10/07! And it's SO easy to take your eye off the ball as to where the real gains are happening!

correction: scratch that notion that potash explains the performance of the "nonmetallic mining". A closer look reveals it's a "grab bag" category with a few gold cos. as well. The newly listed Imperial Potash is in there (and went up 24%) but the big potash gains (from POT) were under agricultural chemicals.

Without that sub-industry amongst the true gainers, results look even MORE concentrated!

shanghai opens down >4%...

vinod: Thanks

The Dali Lama is amazing, one of the few people who truly embraces acceptance fully.

"shanghai opens down >4%..."

What do you think 2nd....DJIA 12000 tomorrow?
I fly tomorrow....I scheduled my flight for after the close. :>)

Jock -

Thanks for analysis.

wabrew:

I'm also a frequent reader and only occasional poster; I like the format the way it is. I find it easy to just skim past stuff that doesn't interest me. I use firefox and "highlight all" with a search on the page for "gold". That's my bias.

S&P cuts ratings on 799 classes of ABS backed by MBIA, Ambac to match financial strength

http://tinyurl.com/4q6led

This may be why the banks are melting.

S&P futures are off 0.50% already, which I think is an unusual move after hours.

Marc Faber inverview:

http://tinyurl.com/693znp

(or Stephen Hawking playing with his voice system)

This is the setup I have waited for. Last time the PPT and BB interveined. The same day we were to fall into the abyss, they bailed out BS.
A fitting stock symbol.

"It looks to us as if wave 2 up may top around the 12,340 to 12,400 area Tuesday, maybe Wednesday, to be followed by a sharp wave 3 down of {iii} down of {3} down." McHugh

Chinese banks getting slaughtered. Last I saw they were all down 8-9%, overall Shanghai down over 5% last I checked. Should be an interesting open....

China's main share benchmarks off more than 8% in late trade

By Chris Oliver
Last update: 3:22 a.m. EDT June 10, 2008

HONG KONG (MarketWatch) -- Chinese stocks came under a cascade of selling late Tuesday afternoon amid concerns over the outlook for corporate earnings given higher oil prices and further macroeconomic controls announced by the People's Bank of China over the weekend. The Shanghai Composite Index plunged 8.1% to 3,061.47 while the Shenzhen Index tumbled 8.3% to 925.72. The PBOC announced over the weekend it would lift the ratio of reserves banks must set aside as deposits by 1 percentage point to 17.5%. The reserve hikes are due to come into effect in two separate half-point moves in coming weeks. Banking and property shares were among leading decliners as investors judged them the most vulnerable to the PBOC's reserve requirement changes. Among Shanghai-listed shares trading limit-down 10% were China Merchants Bank and Shanghai Pudong Development Bank. Shenzhen-listed shares of property developer China Vanke also tumbled its daily limit 10%.

(Aurator never sleeps... he just trades tired, with a lot of coffee and hope.)

Note how fast they cut off Faber in that interview, and then took the link off the Bloomberg site after he blamed the Fed, collectively, ALL the FED governors, but in particular Bernake and Greenspan, for the entire credit debackle and mess.

Somebody at Bloomberg got a call, and carried out their Bush puppet duties and created another small lump under the rug.

When truth tries to come out, it is suppressed.
This is not the USA I grew up in. This and thousands of other examples. We should mourn the demise of the US empire, as it is unraveling before our eyes.

http://tinyurl.com/5vm9d4

Phantom of the Dollar

I double dog dare him!

So has the likelihood of a credit default swap tsunami decreased?

Per Bloomberg:

"Derivatives Deal

The New York Fed, the central bank's main link with Wall Street, also yesterday announced an agreement with banks on changes aimed at easing the risk of a collapse of the $62 trillion market for credit-default swaps.

Seventeen banks that handle about 90 percent of the trading in the market will create a system to move trades through a clearinghouse that would absorb a failure by one of the market- makers, the New York Fed said."

And so this week, Bernanke speaks and the futures drop like a stone.

Not that it needs repeating, but this market is as skittish as a squirrel in a dog park.

Good morning.

Here are your Cara 100 Ratings Changes:

Upgrades:

KO - to Buy @ Deutsche Securities
OXPS - to Neutral @ Merriman Curhan Ford

-------------------------------------------------

Have a great day.

Heard from an experienced fixed income fund manager on minyanville: "don't credit default swaps sound like portfolio insurance".

Portfolio insurance was blamed for the 87 crash. This effort by the NY Fed is more talk to keep confidence, but it makes no sense. How are they going to create a market maker to absorb potentially tens or hundreds of billions in losses?

Also, treasury yields are skyrocketing even as stock market falls. Same thing happened in 1987. And now the Fed is out of bullets. They can cut rates, but inflation will explode and their credibility will be shot. I think Bill is right: the pros offloaded their shares and now it is time to let the market fall.

Last night around midnight US Congressman Dennis Kucinich introduced 35 Articles of Impeachment against President George W. Bush.

http://tinyurl.com/24lh4m

This morning: not a word anywhere in the news.
Juuuuuuust lovely.

What if they gave an impeachment and nobody came?

"This morning: not a word anywhere in the news."

facism

Thanks for the heads up, reenzo.

I couldn't find the story on your link but here's a rundown of the charges:

http://tinyurl.com/5o6k3q

Sadly there is no time for impeachment....but like pardoning Nixon, it can have a chilling effect going forward as criminals like the current Prez don't think we'll take action.
If we had prosecuted Nixon we wouldn't have many of these problems.

At least someone is acting in accordance with the facts, even if less than effective, it's on the record and in the history books.

DCR down to .49 currently. It looks as if it may go to zero.

Why does OIL jump every time one of these brokerages raises their price targets? I can't imagine anyone believes these brokerages. It must be that they're obviously front-running the oil market as they must all be long oil.

Rob.

How about that dollar head fake last week? Right now it's almost back to where it was before "supposedly" Trichet roiled the markets with his rate increase talk.

I'm thinking it's the banks getting vicious, slaughtering the pigs to save themselves.

Rob.

The FXP club should be happy today!!!!!!!!!!!!!

Rob.

Remember Dennis Kucinich did the same thing with Cheney. Nothing came of that...

Kucinich Introduces Impeachment Articles Against Cheney - April 2007

http://tinyurl.com/ys4xet

Once again Bill C. has kept us "tin foil" types OUT of gold during a nasty downturn, which move I also predicted. Goes to show you, the yellow metal needn't blind us as regards trading it for a profit.

Obviously as the end rate cuts nears casual paticipation in this trade is being liquidated in preparation for the upmove that sticks. It's only a question of when.

"Remember Dennis Kucinich did the same thing with Cheney. Nothing came of that..."

He was no less right in that case, either. Fault our corroding public institutions for not prosecuting either of these criminals.

hey 2nd...oil's coming down...does DCR become a trade? Sure does.

Did anybody see the story last week about homemade bathtub cheese that's causing TB throughout the southwest? Shoutout to Mike_nyc.

Rob, right, FXP Club is looking forward to our adventures in the market today. However, now it is really difficult (for this member, at any rate) to decide whether to sell today, or to hold in anticipation of more turmoil.

It's tempting to just sell (assuming we get a good gain today) and be happy. Casey has reminded us that money isn't everything, and who knows if this rally will fizzle or turn into another moonshot above $100. What are other members of the FXP Club thinking???

CAF-> scaling in at 38.32...

personally, i would take both the gains in FXP + any/all anxiety about it off the table...then sit back and trade the position as much as you want with smaller position sizes...it's up 20 points from the dog days of may, right...

[Bill Cara note: my ISP crashed this morning, but is now back online. I'll publish asap.]

shark- the red chip on DCR @ 0.63 still on, man...

Allen,

I'm in the FXP club and I just keep moving my STOP LIMIT order up so that profits can continue to run and I make the most of what the markets gives me.

Thanks, 2nd. Probably should do that. It's too uncertain what direction it will go. You're probably right that it would be reasonable to continue to trade a small position, but there seems to be too much uncertainty about the direction of the China market to take big positions.

TSO/VLO/SUN-> knee jerk sales this morning, but you know what..the nice thing about buying on weakness is your basis is lower than 99% of the holders out there...and i don't see these companies not making money anytime soon...

Add HOC to that group of refiners, scaling in

speak of the devil-> refiners have now all recovered...VLO's even in the green...insiders/smart money buying? who knows...

Allen

I'm holding. See Stonecrest's post above your 9:48 post. Good advice.

SRS was at 81.xx at the close of Thursday when I loaded up. Today it hit a high so far of 95.30. Along the way I have sold off 75% of my holdings. Wish I hadn't, sometimes it pays to be a "pig". :-)

2nd
brought SKF at 125.32
piex at 3.04 500
waiting for airlone to hit 52 week mlow
got in this morning in vlo/sun/tso

to be honest with you, there's so much volatility in FXP were you to exit now and then trade it twice, it would probably outperform a hold...JMO...

not piex but PEIX

taking QID off the table...still holding SMN...

Opened position in PAL @ 4.97 - now holding a small bit of SWC and PAL

BC - Saw it drop yesterday so picked some up looks great! Thanks Bill! ;~)

June 10, 2008
Bill Cara's Community Chat

Is up...

http://tinyurl.com/5z2we5