Cara’s Commentary & Community Chat, Fri., Jan. 16, 2009

[7:15am ET] The Obama Inauguration Rally starts this morning. Carnival American-style. Banks and Retailers, Energy and Basic Materials, Technology

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334 Comments

  1. swissrobinson(118083 comments)-
    January 16, 2009 at 12:16 pm

    Good Afternoon.

    So do I.

    I was thinking of DOW today. I see you’ve noted accumulation zone there, which assumedly will change to buy alert today. Can you explain the definition of accumulation? What’s happening to the stock that tells you this?

    Ta

    Les.

    • Chickenpookie(118083 comments)-
      January 16, 2009 at 2:59 pm

      swissrobinson

      “When the daily, weekly, and monthly RSI values for a ticker go below 30, that represents an Accumulation Zone, where it may make sense to start buying that equity. When the daily rises above 30, that is considered a Buy Alert, as it is a sign that the equity in question was at a cyclical low and is starting to rise again. For the opposite reasons, when the daily, weekly, and monthly RSI values are above 70 it is considered to be in a Distribution Zone, and a Sell Alert is when the daily RSI drops back below 70.”

      From – “>Bill Cara’s webpage: “I use the following technical indicators every day, but in combination with fundamental and quantitative studies plus a healthy dose of intuition and common sense. I never rely on technical studies alone — and neither should you.” The point being that these RSI calculations can help inform your investing, but it would not be wise to blindly follow what they say.

      • swissrobinson(118083 comments)-
        January 16, 2009 at 3:05 pm

        >When the daily, weekly, and monthly RSI values for a ticker go below 30, that represents an Accumulation Zone

        Thanks Man

        So it’s all three RSI indicators is it.

        Ok. I’m in DOW @ 15.53.

        Let’s see what happens.

  2. swissrobinson(118083 comments)-
    January 16, 2009 at 12:19 pm

    Learning Options 101 today.

    Queried my broker about practicing options. They said, ‘pass our little test’.

    I now find myself trawling through the Eurex exchange getting myself edumacated…

    LE.s

  3. Craig(118083 comments)-
    January 16, 2009 at 12:54 pm

    I have the same question as Ron Sen’s wife…..”is our money safe at Bof A?”

    See Ron’s blogspot for the answer…..hilarious….:>)

    • swissrobinson(118083 comments)-
      January 16, 2009 at 1:13 pm

      I have the same question as Ron Sen’s wife…..”is our money safe at Bof A?”

      haha funny.

      Tried to watch the Jim Cramer vid on the same page. Damn that guy gives me a headache.

  4. moad_us_operandi(118083 comments)-
    January 16, 2009 at 12:59 pm

    How do these criminals do it?
    Engineered take down the days before expiration?

  5. 2nd_ave(118083 comments)-
    January 16, 2009 at 1:16 pm

    “It’s like motorcycle owners losing their fear of riding. That’s when they’d damn well better sell that bike.”

    jock- i know what you mean, but there’s a distinction between a total lack of fear and confidence…i think (validity of)intuition/reading the tape (or the defense, or the audience, or what have you)/reaction time, and therefore (successful) trading, are all highly dependent on (self-)confidence…

    David, IMO, is exhibiting an informed lack of fear based on his read of the market, which is in turn based on the rhythm he has found in his trading…

    in fact, i think most motorcycle owners exhibit less fear (in general) than the average automobile driver; otherwise, they may as well forget about buying one in the first place…

    • nemo(118083 comments)-
      January 16, 2009 at 1:23 pm

      fear is good…it inhibits pride

      • 2nd_ave(118083 comments)-
        January 16, 2009 at 1:32 pm

        nemo- it’s not fear that tempers pride, it’s self-respect and respect for others…fear leads to insecurity, which is often expressed as ‘pride’ (often described as having something to prove), whereas self-respect leads to restraint (having nothing to prove)…the best quarterbacks exhibit great confidence on the field, while simultaneously exhibiting modesty and respect for others off the field…JMO

    • tgifbipo(118083 comments)-
      January 16, 2009 at 1:45 pm

      “It’s like motorcycle owners losing their fear of riding. That’s when they’d damn well better sell that bike.”

      There is a time to be aggressive and defensive, always look out for road conditions and the other guy, its all a part of protecting yourself. I have been on one for 30 yrs. and i guess its just like navigating the market, just never thought of it that way.

  6. number2son(118083 comments)-
    January 16, 2009 at 1:37 pm

    One of the problems with not being able to trade the markets for the entire day (such as those of us with a full time job) is that you miss significant intra-day reversals. Such was the story yesterday.

    In any case, I’ve adapted my trading style accordingly. Tight stops which often result in lost opportunities but, more importantly, protect you against large losses.

    I’ll be looking forward to our Hawaiian friend’s comments about the BAC bailout. It should be a classic. 😉

    FWIW, the situation has truly become surreal.

    • dberryclan(118083 comments)-
      January 16, 2009 at 2:02 pm

      ditto on missing the reversal, combination of my lack of discipline, personal distraction and inexperience. I added to leaps on GG at about 24$….maybe we’ll see $20 prices before it takes off for the moon 🙂

      As far as the bank headlines and market action etc the past two days…..it smelled like a big set up to me. HB&B seems to love to play that card to get the politicians around the world to make bigger and bigger promises and then, “poof!” its all okay for awhile……”it’s a game”, high stakes game. I’m committed to learning and winning at it.

      The phrase “the market is us” is getting clearer and clearer all the time…

      happy trading 🙂

      • number2son(118083 comments)-
        January 16, 2009 at 2:12 pm

        You’re right. And we have to play the hand we’re dealt, db. Given the recent volatility, caution is the better course. And I have no regrets about my trading plan. I’d rather miss a good trade here and there than get walloped by some unexpected (or expected) event. Many of us here expected something like this regarding BAC. But I could just as easily envision a sell off in response to the bailout than what we have seen so far. Better to let the news come out and try to ride the trend before it snaps back the other way yet again.

        • dberryclan(118083 comments)-
          January 16, 2009 at 3:37 pm

          agreed #2, well said….reading the hand dealt to us is what I’m diligently applying myself to learn if this is an ignagural bounce, i hope it is good to all here at Carablog 🙂

      • 3percenter(118083 comments)-
        January 18, 2009 at 10:16 pm

        I don’t know how to attach a chart image here but it looks to me like the final stages of an “m” forming there in GG, with a subsequent breakdown in the works.

        http://finviz.com/chart.ashx?t=GG&ta=1&p=d&s=l

        • Quasi(118083 comments)-
          January 19, 2009 at 2:03 am

          RE chart and link posting basics, try having a look under the top menu bar “Site Index” >> “Website Help” >> Community Chat Posting Basics. Instructions are posted there, or follow the direct link below.

          http://caracommunity.com/content/community-chat-po

  7. Bull Hunter(118083 comments)-
    January 16, 2009 at 1:39 pm

    Good morning.

    Downgrades:

    GG – Downgraded to Neutral @ JP Morgan
    KGC – Downgraded to Neutral @ JP Morgan

    Price Target Changes:

    INTC – from $12 to $14 @ Global Crown Capital
    INTC – from $12 to $11 @ Friedman Billings
    NUE – from $60 to $54 @ KeyBanc

  8. number2son(118083 comments)-
    January 16, 2009 at 2:00 pm
  9. number2son(118083 comments)-
    January 16, 2009 at 2:06 pm

    That may be, and the drop in the price of gas may have helped. But here in sunny CA, gas prices have once again climbed above $2.

    Consumer prices show smallest gain in 54 years

    TBT is racing away from me in pre-market. I was looking forward to getting back in today. ;(

  10. knifecatcher(118083 comments)-
    January 16, 2009 at 2:13 pm

    The CPI numbers are phony. I follow the more reliable MDCPI which is up 19% this year.

    (That’s the McDonalds Double Cheeseburger Price Index)

    McDouble for $1 (one slice cheese missing)
    Double Cheeseburger now $1.19

    • Scott(118083 comments)-
      January 16, 2009 at 2:56 pm

      Great index although the #1 Combo Index (from anywhere) is quite reliable and steadfast.

  11. Craig(118083 comments)-
    January 16, 2009 at 2:16 pm

    BAC @ 8.34 premkt. Should make up for missing the 7 handle yesterday….

    Riding: Yesterday I felt like I needed training wheels on my Moped. Today on my open MX ride I’m flying high and gettin’ big air. I needed the open bike and big air confidence *yesterday*.

    I also notice….when riding, the other riders and officials almost never try to purposely knock me down.

    • bigwad1(118083 comments)-
      January 16, 2009 at 2:37 pm

      craig
      hoping you sold on the open.
      this flash of green is starting to fizzle.
      banks get more billions, and everyone is an investor.
      i need to see a shrink, or take a nap, the are synonymous.

  12. Bull Hunter(118083 comments)-
    January 16, 2009 at 2:19 pm

    INTC – price target lowered at Goldman to $12 from $14 due to weakening earnings trends. Maintained Neutral rating.

  13. number2son(118083 comments)-
    January 16, 2009 at 2:21 pm

    Is anyone else following UNG? I see a nice setup on the hourly. And the daily is grossly oversold.

    • bg(118083 comments)-
      January 16, 2009 at 2:29 pm

      I hope it’s about to move. I have been holding 200 shares most of the way down.

      • number2son(118083 comments)-
        January 16, 2009 at 3:30 pm

        Just went long after steep pullback. Stop just below 52-week low. I’ll move that up to break-even if the price cooperates.

  14. Grym(118083 comments)-
    January 16, 2009 at 2:22 pm
    • jock(118083 comments)-
      January 16, 2009 at 4:12 pm

      Grym – Sorry to hear about your cousin’s son. A scattering of gravel turned the other routine circumstances into a death sentence. A rollerblading friend of mine landed on his front teeth because of a small twig in the asphalt pathway. Hardly “black swan” events. Hardd to protect against – unless you abstain. I’ve contented myself with running and biking for exercise, and a sports car for transport. I’m settling for lesser thrills, but also avoiding risk! Yet, we’re all traders now, whether we like it or not …

      • OldGoat(118083 comments)-
        January 16, 2009 at 6:14 pm

        “running & biking” and “avoiding risk” are mutually exclusive. Couldn’t tell you how many time I’ve cheated death by inches (or less!) when running by the side of the road or cycling down a hill and around a blind curve only to find an oncoming car cutting the corner and crossing the center line into my lane or buzzing past just an inch or two from m elbow. Motorists seem to have the mistaken belief that cyclists have no right to be on “their” roads, despite laws to the contrary. Where I live it is now the law that motorists must pass no closer than 3′ away from a cyclist–as if! At least automobile drivers seem to grasp the concept that motorcycles are vehicles entitled to their share of the road–not so with cyclists.

        • jock(118083 comments)-
          January 16, 2009 at 6:21 pm

          Old Goat – I bike and run on paths inside a park with a 6 mile perimeter. You’re right to point out that running or biking on roads is VERY dangerous.

        • yvrapx(118083 comments)-
          January 16, 2009 at 6:31 pm

          Grym thanks for sharing the circumstances around the loss of your friend. I ride as well and have for 30 years during that time I have been hit; once by a car running through a stop sign and secondly laid my bike down to avoid being decapitated by a flatbed that had thrown a rod during a downpour on the interstate at 60. As you note ‘I doubt that Craig was doing anything foolish (he was no show-off) it was just a combination of circumstances’. Circumstance and the reaction thereof is what matters. In Craig’s case no amount of reaction could overcome his circumstances that day. I would surmise his time on this earth was well spent and he left many great memory’s for all of those he loved and loved him. I consider myself fortunate in that I was lucky in one instance and chose the appropriate reaction the other.
          The analogy of bikes and markets is a strong one if only to be reminded that when we have control over our circumstance to make the most of it.

  15. Grym(118083 comments)-
    January 16, 2009 at 2:37 pm

    Knifecatcher,

    I like it!

    The CPI, 40% of which is based on “Owners’ Equivalent Rent” managed to hide rising inflation as house ownership soared and is doing a similar, but reverse job now with the decline (deflation) of housing.

    BUT… The CNBC morning cheerleading crew were all excited about “the lowest CPI in 15 years” and lower energy numbers.

    Does this mean even with the built-in distortion deflation is that much more of a factor? If so, bonds are a good place to be.

    Wouldn’t it be great to have the most accurate data possible instead of feel good BS? One of my sons has a degree in statistics and worked several years for a consumer research company. His job was data quality. They would never have given such shoddy numbers to a client.

    We’ve all heard the food business is vicious these days. Just curious, do you have an MDCPI chart for the past several years?

    • knifecatcher(118083 comments)-
      January 16, 2009 at 2:46 pm

      Unfortunately I don’t have a chart- just the ongoing sense that “money” doesn’t buy what it used too. I guess it’s a pet peeve of mine that the typical boobus americanus seems to accept that prices “go up over time” and can’t recognize that they are being robbed of their savings (what’s left after taxes) by our fraudulent money system. 40 years ago, a man could finish high school and work a trade, and make a decent living for his family. Own a house, car, etc. Not happening today. And no one seems to notice, no one seems to care…

      KC

  16. Craig(118083 comments)-
    January 16, 2009 at 2:38 pm

    BAC: Out at 9.20 Not as good as I hoped, but it beats a sharp stick.
    SLV: In yesterday 10.34 out @ 10.91
    LIHR: Took some profits from yesterdays buy.

    I don’t trust this rally, it’s still buy the dips, sell the rips and I’m worried about this supposed rip. I can always get back in if the chart gods are with me.

    • number2son(118083 comments)-
      January 16, 2009 at 2:45 pm

      Well played, Craig.

      Oh, and welcome back, Grym!

  17. 2nd_ave(118083 comments)-
    January 16, 2009 at 2:39 pm

    offing the shares bought at 5.18…back to 200% of allocation…

  18. Scott(118083 comments)-
    January 16, 2009 at 2:52 pm

    Why bailouts and stimulus packages are supposed to have a different impact this time around… didn’t prior intervention(s) have a negative impact on markets or am I wrong…

  19. London(118083 comments)-
    January 16, 2009 at 2:53 pm

    Big winner in education services -stimulus plan from yesteday-

    • London(118083 comments)-
      January 22, 2009 at 1:11 pm

      Gave this one on the 16th around $110. Reported EPS this morning and trading at $124 last. Look to APOL as beneficiary here to avoid chasing ESI gap.

  20. shark_attack(118083 comments)-
    January 16, 2009 at 2:55 pm

    I bought 1000 Yamana near the close yesterday, sold half at a 10 cent profit, rode the other half down past my buy price and sold. How was I to know gold would rally like a mother? Think I wish I’d held that stock?

    • Chickenpookie(118083 comments)-
      January 16, 2009 at 3:09 pm

      shark – “How was I to know gold would rally like a mother? “

      If your time horizon is about a week, gold can rally to $890. This happens repeatedly, but one day it’s going to really spike (pendulum effect)… Deflation takes power away from the FED, and they’re doing their best to keep that under control. When the pendulum swings, they’ll be pulling an opposing set of strings.

  21. teamonfuego(118083 comments)-
    January 16, 2009 at 2:56 pm

    If I wasn’t all in on the positions I love (KBR, MDR, APWR, BIDU) I would be shorting SKF at $150.

  22. 2nd_ave(118083 comments)-
    January 16, 2009 at 2:59 pm

    to 100% of allocation (and March 5 calls)…

  23. goldbug58(118083 comments)-
    January 16, 2009 at 2:59 pm

    Took a nice 5 1/2 point gain 33% profit in 2 days, so that’s my trade-of-the-day/week.

  24. shark_attack(118083 comments)-
    January 16, 2009 at 2:59 pm

    This is no time to sell SLW…freaking thing’s just starting to perform.

    • knifecatcher(118083 comments)-
      January 16, 2009 at 3:03 pm

      Amen. I’m not selling till I at least make lunch money off of the $15/sh SLW I bought in 5/08…

      KC

    • bsi87(118083 comments)-
      January 17, 2009 at 1:07 pm

      max pain 5 bucks for Feb/Mar.

      no position.

  25. Craig(118083 comments)-
    January 16, 2009 at 3:01 pm

    Nice work 2nd. Good to see you in fine form.

  26. shark_attack(118083 comments)-
    January 16, 2009 at 3:01 pm

    Those big daily gaps in SLW and AUY ‘tween yesterday and today are good things….Both have plenty of room to run. I am a stunad for selling yesterday, but what if I hadn’t? Would gold have opened up 30 today if I’d been holding overnight, is the question you need to ask yerself.

  27. Craig(118083 comments)-
    January 16, 2009 at 3:02 pm

    Selling with profits is like pizza, almost always good.

  28. Craig(118083 comments)-
    January 16, 2009 at 3:08 pm

    Reloaded at 8.03 and out at 8.35. Now is where I need to wait as I usually play too long and get my fingers burned. They all work until they don’t….

    • teamonfuego(118083 comments)-
      January 16, 2009 at 3:16 pm

      C, not BAC, looks interesting to me. Looking at buying the Feb $4 calls at .82.

  29. 2nd_ave(118083 comments)-
    January 16, 2009 at 3:10 pm

    both SLW and UCO/USO have room to run…

  30. shark_attack(118083 comments)-
    January 16, 2009 at 3:15 pm

    Eh…Sometimes yer right, sometimes yer wrong:)

  31. jack black(118083 comments)-
    January 16, 2009 at 3:17 pm

    I was super busy yesterday to follow markets, but my dreams for reversals were fulfilled. I see that Bill is super bullish for a few days. Great, fits with my plan, but looks like a later retest is not out of question. Trying to figure out a good target of my TNA that I got on a dip. Any one cares to suggest?

    BTW, the weirdest thing that happened to my portfolio was a limit sale of JJC at 27 that went through this AM. It’s not even on the charts. WTF? I shrugged and reloaded at 21.4. Now the limit is upped to 28. Too bad it was a small position.

  32. bigwad1(118083 comments)-
    January 16, 2009 at 3:18 pm

    Can you add a daily/weekly CARA POLL?
    Various questions….
    Do you use options,A B C D?
    Did you trade short more then long last week, Y N?
    Are the markets bear or bull, Y N?
    How many trades do you make per week,A B C D?
    Is the bank bailout working, A B C D?
    Does your broker execute your market trades timely?
    Do you get a severe headache when you listen to Cramer, Y N?
    Have you ever traded contrary to Cramer with great results, Y?
    Is Paulson good for the markets, Y N?
    Which brokerage do you use, A B C D?
    You could put in a suggestion link for future Cara Poll questions.
    The poll could be an endless stream of polling questions.
    Just curious.

  33. daydreamer(118083 comments)-
    January 16, 2009 at 3:22 pm

    Looking for more put ideas sold today Feb Yhoo 11 put Feb Cop 40 puts, Roh Feb35 great deal stock at 59 even if Dow merger called off this will hold above 40 made lot on the Jan 40 that will expire today. Any one selling put on new Cara 100’s JNPR APA. Any interest in WFMI lots of upgrade and new private investment capital.

  34. davefairtex(118083 comments)-
    January 16, 2009 at 3:24 pm

    jack – you probably made your order eligible for post-market session trading. Some poor slob probably did a market order post session. Either that, or was really desperate for your shares.

    • jack black(118083 comments)-
      January 16, 2009 at 3:30 pm

      You are absolutely correct, the 27 price shows on google finance with afterhours enabled. Ameritrade shows no afterhours on their charts.

  35. NotNekkidYet(118083 comments)-
    January 16, 2009 at 3:26 pm

    Bill’s comments today indicate that his indicators are telling him some upward price movement is in store for a few select equities so the question is, will they propel the larger market upward and onward?

    A question to any and all: WHY would additional bailout $$$ for BoA be a positive in any sentient being’s mind, much less a cause for the market to perk up?

    Great analogy on Mish this AM as parallels with Rand’s Atlas Shrugged and the government intervention today are made. Heady stuff.

    http://tinyurl.com/d8q6j

    Happy Friday all!

    • jack black(118083 comments)-
      January 16, 2009 at 3:34 pm

      You cannot use rationality to explain market moves. They are often random short term wise. As for the Obama rally, my opinion is it happened in the first week of 2009. Now, it’s more dicey to predict the move.

      • Bill Cara(118083 comments)-
        January 16, 2009 at 3:46 pm

        I wasn’t too early. Gold is up +$27.00/oz and the S&P up +1.10%. The end of the day — after Europe closes — ought to be stronger. The Techs will be the tell. Providing funds for BAC and C is important for confidence that these banks will remain good counter-party risks, which was the problem that took down Bear Stearns and Lehman Brothers.

        My rally call was for a few days only and is partly a belief that shorts will be covered until after the Obama post-inauguration celebrations and speeches. The Big 3 banks still have Credit Market derivative positions to unwind, which will cause spikes to prices on days to come. But, all in all, there has been a shift in attitudes, I think, and people are becoming more hopeful. Don’t forget that Obama is revered in many other parts of the world, so any money flow into US equities (ie, higher prices on higher volume) will quickly spread globally, I believe.

        • Bill Cara(118083 comments)-
          January 16, 2009 at 4:05 pm

          Further, the S&P is sitting right under 850. For my crystal ball to be right it should be building momentum at this level and then break out to the upside this afternoon.

    • Chickenpookie(118083 comments)-
      January 16, 2009 at 5:03 pm

      notnekidyet – “A question to any and all: WHY would additional bailout $$$ for BoA be a positive in any sentient being’s mind, much less a cause for the market to perk up?”

      B/C a majority believe an economic recovery isn’t possible, or will be extremely long without government assistance?

      • Bill Cara(118083 comments)-
        January 16, 2009 at 5:09 pm

        Market down so far only because the Banks are down -5.6%. Obviously this is still a concern. Note that as soon as Treasury commented on an Aggregator Bank, and there was Tout TV discussion of regulation of banks like a utility group, the Bank stocks sold off.

        Regarding economic outlook, note that the White House just made their final econ forecast for 2009, believing it will gain +0.9%, and +5.0% for 2010.

  36. Seamus(118083 comments)-
    January 16, 2009 at 3:37 pm
  37. Finger Lakes(118083 comments)-
    January 16, 2009 at 3:41 pm

    “Bank of America agreed on a deal to receive an additional $20 billion in support from the government. The bank will also receive guarantees to cover up to $118 billion in losses on loans and securities backed by residential and commercial real estate.”

    Recently the government also agreed to cover losses on 300 Billion of C’s liabilities which are about 1/3 of C’s questionable assets.

    If we assume the same level of Guarantee for BAC that means they have about 400 Billion of questionable assets.

    Both of these failed banks will need much more from the government this year. I still fail to see how mortgaging our kid’s future to the banks has helped. I would still never put my money in any of those corrupt institutions.

    In fact I’m thinking of going a step further and cutting up our Citibank credit cards and trading them for one issued by our local private bank. If I don’t believe in their business model why should I support it?

    Imagine how screwed they would be if we all cut up our cards issued by the major banks?

    Rob.

    • Bill Cara(118083 comments)-
      January 16, 2009 at 3:58 pm

      Rob, I think most people here agree with the position that no bank should be saved by taxpayers, for various reasons. In future, perhaps the US govt might consider having a reserve well-funded strategic bank in reserve to be able to step in and take over the operations of a failed bank or banks for a short interim period until the failed bank(s) can be restructured and sold to other banks that competitively bid for the assets. That seems to me to be the most effective way to preserve the financial system. Bringing in Goldman Sachs to strip the Treasury in order to bail out their distressed friends has been an unmitigated disaster. Hopefully the legislators will learn from their mistake because the next cycle, maybe four or five years down the road, this problem could be worse.

      • jock(118083 comments)-
        January 16, 2009 at 4:29 pm

        Bill’s notion (of gov’t having a strong bank “in reserve” as an anchor for the financial system) would have been infinitely preferable to the disasterous TARP, as run by Mr. “Wow, did I get a great tax-break!” and Mr. “Hey, I don’t BOTHER to pay MY taxes at all!”

        But will such a strategy be an relevant “next time”?

        Don Coxe, in today’s audiocast, (http://events.startcast.com/events/199/B0003/code/…)
        notes that the non-gov’t equity in BAC and C has now fallen below that of the largest Canadian Banks. He also notes that the TED spread is behaving well, despite the renewed turmoil in Wall St. banks. Liquidity IS returning to the system, though not through the Wall St. banks.

        Coxe feels that, going forward, the US gov’t will direct lending (french-style) and that (except for industries which become “national champions” under Obama, like alternative energy) Wall St. banks will NOT be at the center of global finance going forward.

        Coxe may be over-stating, but he’s on to something too, no?

        • Bill Cara(118083 comments)-
          January 16, 2009 at 4:39 pm

          Shortly after I posted my comment, Bloomberg reported a wire from Treasury that stated “lots of work” was being done on an “Aggregator Bank”. Are these people reading my blog or am I reading their mind?

          • nemo(118083 comments)-
            January 16, 2009 at 4:41 pm

            You are one with the financial universe…

          • Finger Lakes(118083 comments)-
            January 16, 2009 at 5:50 pm

            An Aggregator bank to take all the bad paper wouldn’t be a bad idea. But the article talk about using mainly TARP money to fund the Aggregator bank.

            It tells me that these people are either stupid or lying. The agggregator bank will need to buy at least 10 Trillion worth of bad paper. Possible as much at 20-30 trillion if they start buying bad assets from insurance companies and state and federal pension funds.

            And how about the bad paper FRE and FNM have?

            I still think the best course of action would have been to save our 8.7 Trillion while letting these compromised banks fail. The FDIC could have divided up the assets and liabilities and given the assets to the next strongest banks in line.

            The 8.7 Trillion could then be used to help the new banks take over for JPM, BAC and C.

            Unfortunately Crony Capitalism wouldn’t allow a logical solution like that to even be considered.

            Rob.

      • OldGoat(118083 comments)-
        January 16, 2009 at 6:53 pm

        All animals are equal, but….

        http://i48.photobucket.com/albums/f240/goodbye-gir

  38. holdenll(118083 comments)-
    January 16, 2009 at 3:52 pm

    Glad I missed the buy point yesterday….Closed at 9.24 yesterday and has now dropped back to 9.05….Opened with a bearish engulfment…opened with bearish engulfment on 13th and dropped from there. I watch the on balance volume on both the hourly and minute to find the right place to jump in. Will let you know if I pull the trigger.

    Note: if you want to “play trade”, I have a portfolio at http://www.tickerspy.com under Gardere. I do not think it is a great because the execution of your trade is usually at the end of the day…Have been able to eke out a 10% return there in the past month. The other site I like is http://www.updown.com . Trades are executed fast BUT no one can see your portfolio or trades…What fun is that?

  39. NYUGrad(118083 comments)-
    January 16, 2009 at 3:54 pm

    gut check says with markets closed monday for Martin Luther King, there may be a mad rush in or out. not sure which. but with Obama being sworn in Tue, my guess is rush into markets before close today.

    then you have to worry about the market open tue. I still remember the day after Obama won the election the markets sort of wimped out.

    Tick tock – i only have a few hours to place down my chips.

    • jack black(118083 comments)-
      January 16, 2009 at 5:21 pm

      I hesitated this AM even though I saw that the market was overbought short term. Now, it feels like the door is closing rapidly.

  40. vanillabean(118083 comments)-
    January 16, 2009 at 4:15 pm

    bank of america 7.50 and falling. (*^

    Where are the interventionists when you need them?

  41. 2nd_ave(118083 comments)-
    January 16, 2009 at 4:26 pm

    cautiously bullish, whatever that means…

  42. NYUGrad(118083 comments)-
    January 16, 2009 at 4:34 pm

    Kind of weird they just finished building a bog box circuit city on 22 in Union NJ.

    http://tinyurl.com/9wnu46
    Highlights:
    * Says does not anticipate any value will remain from the bankruptcy estate for the holders of its common equity

    * Says will provide more details in near term about plans for liquidation of
    stores, other assets, status of Canadian operations

  43. shark_attack(118083 comments)-
    January 16, 2009 at 4:40 pm

    What happened to Charlie Gasparino’s hair? It looks like he got into the shoe polish. Reminds me of that funny time long ago when that dude, what was his name he’s on a different network now….anyway, he showed up in a wig one day and it was a real laugh. Neil Cavuto I think?

  44. teamonfuego(118083 comments)-
    January 16, 2009 at 4:46 pm

    GE is still falling. I don’t like the action in this one at all…it tells me their debt will be downgraded.

    As far the inflation trade goes with all of these bailouts (a theory which I’m not a big backer of right now), what are your thoughts of MA being an inflation trade what with prices going up and them taking a piece of every transaction?

  45. Grym(118083 comments)-
    January 16, 2009 at 4:47 pm

    Well, those of us who do care cannot attract enough attention from anyone. I’ve come to realize the only way to reach my “representatives” with an opinion is by tying it to a rock an hitting him on the head.

    Economic/political information is more readily available than ever before, but the overwhelming number of people get their daily news sound bites and swallow them as fact.

    “40 years ago, a man could finish high school and work a trade, and make a decent living for his family.”

    Yes, 42 years ago I started my own business with $1,000 borrowed from my Dad. I was able to support a family of four without any group health care insurance (all medical paid out of pocket) paid off our house in only 12 years, saved enough to send the two boys to college (with scholarships and grants) and save for retirement. I had only two years of college and never made over 5 figures a year. (The secret was called “living within your means”.)

    My wife only went to work (mostly hospital volunteering) out of desire for something more to do after the kids were grown. We took driving/camping vacations are saw America up close.

    One son is now in danger of losing his job to India. The other went into my line of work and is now earning less per hour than he did in 1993. (one third the total per year) Even though single it is a struggle.

    As I said at the 1993 pushing thru of NAFTA… it stands for:
    Not A Fine Thing America.

    Our city was a major manufacturing center and is now pushing tourism! Sure, come and see where people once made things we could sell and the companies’s receptionists were the welcomers who greeted you.

  46. shark_attack(118083 comments)-
    January 16, 2009 at 4:52 pm

    Anybody remember Culture Club?

    3:50pm UK, Friday January 16, 2009

    Singer-turned-DJ Boy George has been jailed for 15 months for handcuffing a male escort to a wall and beating him with a metal chain.

    The former Culture Club frontman imprisoned Audun Carlsen during a drug-fuelled naked photoshoot at his flat in east London.

    After calling Mr Carlsen into his bedroom, O’Dowd and another man leapt on him, wrestled him to the floor and started beating him.

    Mr Carlsen was dragged along the floor towards the bed and a manacle was put on his right hand and attached to a hook drilled in the wall.

    The second man left, Mr Carlsen said, and O’Dowd fetched a plastic box containing chains, sex toys and leather straps.

    Mr Carlsen told the court he was able to unscrew the hook from the wall using handcuffs as a tool.

    He ran to the door with O’Dowd chasing him, lashing out with a metal chain.

    O’Dowd has previous convictions as a juvenile in 1977, and for a Class B drugs offence 10 years later.

    He was given community service in New York in 2006 after pleading guilty to falsely reporting a burglary at his apartment in the city.

    • Dr. Strangelove(118083 comments)-
      January 16, 2009 at 5:08 pm

      What does this have to do with investing?

  47. holdenll(118083 comments)-
    January 16, 2009 at 4:56 pm

    got into IRIS at 9.06 and SAY at 1.06…short trigger on SAY

  48. Grym(118083 comments)-
    January 16, 2009 at 5:06 pm
  49. shark_attack(118083 comments)-
    January 16, 2009 at 5:14 pm

    Strangelove,

    It’s a human interest story.

    Anyone remember NXG? I don’t know anything about it, but it looks ready to go up …..I don’t mean this very minute but in general, if gold keeps going up. I am waiting to buy the first “real” breakout over a dollar.

    • jock(118083 comments)-
      January 16, 2009 at 6:19 pm

      Shark –

      I got to meet NXG’s CEO one-on-one a couple of months ago. They are a different type of gold producer. They tend to buy mines with just a few years mine-life left and operate them. They have a low-grade operation set to expire witin a couple of years in Canada,and another Canadian property they hope to substitute for it. They have 2 (higher-grade)producing mines in OZ.

      NXG doesn’t do basic exploration, or acquire explorers. The CEO talks more like a manufacturer, than a deal-maker, ambitious to grow to being a senior producer. The motto of their presentation was “bringing value to the surface”. They were predicting 400K ounces in 2008.

      Personally, I try to trade tactically, stocks that have long-term, strategic potential, so that experience in and out of a given stock can pay off big-time, long-term.

      Now, if an aggressive, cashed-up junior explorer/developer like Fronteer Development ($86M or 4 years’ “burn rate” in the bank; acq. in progress that would take cash to $186M) were to acquire NXG’s production expertise, THEN, I’d get interested. FWIW. DYODD.

      • shark_attack(118083 comments)-
        January 16, 2009 at 6:24 pm

        Jock,

        I understand you have great expertise in the field of mining.

        • jock(118083 comments)-
          January 16, 2009 at 6:37 pm

          I consider myself a STUDENT of mining, and I like to share what I learn. Next time before you open your mouth, shark, to have a bite, drink this first:

          • Dr. Strangelove(118083 comments)-
            January 16, 2009 at 6:46 pm

            jock –

            LMAO.

          • shark_attack(118083 comments)-
            January 16, 2009 at 10:46 pm

            Is this really a nice reply to my complimentary response to you?

            You find yourself in violation of #3 of the community rules and guidelines:

            “003. Do not use foul language.”

            As well as number 9:

            “009. Do not insult community members. Express yourself in a kind and respectful manner, even if you are upset. Flaming and fighting are not permitted.”

            I realize you’re practically an veritable expert on mining, but is this flagrant violation of the stated rules permissible in this new “zero tolerance” environment?

          • seadog(118083 comments)-
            January 16, 2009 at 11:25 pm

            I have to agree with the shark on this one. What I read appeared a genuine positive comment. The written word is not always the best means of communication, it can never convey true meaning so sometimes we write it ‘wrong’ and sometimes we read it ‘wrong’. The two of you are good contributers so please put this to rest. Do unto others as you would have them do unto you. In the meantime best of luck for the coronation over there next week.

            Cheers

          • jock(118083 comments)-
            January 17, 2009 at 12:19 am

            You ask “Is this really a nice reply to my complimentary response to you?”

            No, Shark, it isn’t. I over-reacted. I’m sorry. But think about it.

            You asked: who remembers Northgate Minerals? I try to give you a thoughtful reply with some information from my recent meeting with the company, and you respond only with:

            “Jock, I understand you have great expertise in the field of mining.”

            I don’t appreciate the implication one bit. I’m about sharing information and ideas. Nothing more. I have no ego in this.

          • shark_attack(118083 comments)-
            January 17, 2009 at 12:39 am

            Apology accepted:)

            I don’t know anything about mining but the stock is threatening an upmove, was all I meant to say.

            My referencing your expertise was in earnest, although I realize you may have felt I was being ironic or dismissive, which I was not.

  50. Grym(118083 comments)-
    January 16, 2009 at 5:15 pm

    CP,

    Hey, it’s all about restoring trust and making credit available to the shopping junkies. How else are we gonna get back to a real world economy?

    I guess the truth as an option hasn’t occurred to the bunch in NYC and DC.

    Dodd, Frank, Paulson Bernanke, et al turn my stomache.

    I want to see somebody being questioned in a committee hearing do the Jack Nicholson bit, “You can’t handle the truth!”

  51. shark_attack(118083 comments)-
    January 16, 2009 at 5:17 pm

    They’re selling ’em with vigor

  52. Chickenpookie(118083 comments)-
    January 16, 2009 at 5:25 pm

    “Sometimes the questions are complicated and the answers are simple.”
    Dr. Seuss

    • vinod(118083 comments)-
      January 16, 2009 at 6:45 pm

      Rally started yesterday when Dow was down 200 point. So, question should be am I late for rally?
      We will know at end of Tuesday
      Holding UNG/UCO/TBT and lots of February 410 call on OEX which I brought yesterday added BAC at 7.10 today

  53. shark_attack(118083 comments)-
    January 16, 2009 at 5:31 pm

    For those of you who like the sound of this, Micron looks good to me here.

  54. Fazeli(118083 comments)-
    January 16, 2009 at 5:36 pm

    Anyone betting on BAC, UYG, or C here going into the 1PM trading block?

  55. 2nd_ave(118083 comments)-
    January 16, 2009 at 5:37 pm

    will be looking to longer-dated options for any more additions..

  56. Bear E(118083 comments)-
    January 16, 2009 at 5:39 pm

    This posting is why I am so pleased Grym is back. No spin. Just sharing his life experience with us. Living within one’s means. This is a policy that works! No home equity line of credit. Staying put setting goals eliminating debt and pay as you go. Raising a family. A real man.
    Thank you Gyrm.

  57. Finger Lakes(118083 comments)-
    January 16, 2009 at 5:53 pm

    I’d be more likely to buy F than any of the banks.

    Rob.

  58. tom sheepngoats(118083 comments)-
    January 16, 2009 at 6:02 pm

    UXG seems to finally be on the mend. It’s beating GDX handily over the last few months.

  59. Finger Lakes(118083 comments)-
    January 16, 2009 at 6:04 pm

    Check out BCS! Currently down 27%

    Looks like they’ll take the loser baton from C and BAC for now or maybe they’ll all end down 20+%.

    Rob.

  60. NYUGrad(118083 comments)-
    January 16, 2009 at 6:07 pm

    http://tinyurl.com/89p7e9

    At a certain point, can all equities fall and prec metals rise? it pains me to see redemptions forcing selling of prec metals so they can go cover their rotting aapl. pun intented.

    or is the premise, if everyone is broke, than no one can flee to safety in prec metals cuz there is no longer any capital to protect?

    • Finger Lakes(118083 comments)-
      January 16, 2009 at 6:20 pm

      With big company after big company laying off thousands of employees, I could easily see people using their capital for living expenses rather than “investing” it.

      And none of those layoff will be contributing to 401K’s either.

      The question becomes who has the big money pools that could be invested in the market?

      Rob.

      • NotNekkidYet(118083 comments)-
        January 16, 2009 at 6:52 pm

        How nice of them to release that info……my wife got the ax LAST Friday…:/

  61. shark_attack(118083 comments)-
    January 16, 2009 at 6:08 pm

    These Repubs are not the first to gasp at the size of Obama’s package.

    What’s he trying to do though, take us back to the stone age? In a related article, Obama will be increasing financing to research alternative energy sources such as open pit fires, boiling missionaries in stone pots, and cozying up to comely co-eds after late night study-sessions back at Harvard.

    • bigwad1(118083 comments)-
      January 16, 2009 at 6:56 pm

      It’s strange when this president elect starts predicting that he’ll have the government hire 4 million people so they can keep a roof over their head. And 6 months ago Bush was pounding the table saying it’s only right to bring guest workers into this country to do the jobs that American worker won’t do. What is the American work force supposed to think when there are so many mixed signals. One soon to be washed up president tells Americans they don’t want to work, and a soon to be president says he wants to abolish democracy and turn America into a socialist America.
      Government is already the biggest employer in the world, now they are going to hire 4 million new employees but pay them minimum wage.
      We are in the stone age when it comes to equality.

      • Fazeli(118083 comments)-
        January 16, 2009 at 7:08 pm

        I’m no expert, but I think that the concept of letting everything play out in a capitalist / evolutionary manner (i.e. the strongest will survive, demand will drive supply, private sector will self organize, etc.) is just untested on such a massive scale.

        I don’t fully agree with TARP, the backing of all the bad debt of banks, or the nationalization of key companies in America, but I for one don’t have the esoteric skill set required to work through the panoply of permutations for how this “correction” will play out with and without government intervention as we’re seeing today. Evidently, I think most people lack these skills, even in positions of great power. In fact, anyone who is indeed an expert on the matter is likely to have experience only with advanced models and evidence from smaller scale financial disasters in the modern era (circa 1950 onwards). So trial by fire is inevitable!

        Reform is needed as discussed by Bill and others on this board, but Obama’s actions thus far don’t seem, to me anyway, to be putting us back into the stone age!

    • loannetter(118083 comments)-
      January 18, 2009 at 7:04 pm

      “Boiling missionaries”?! Where do you get these jolts of brilliance? As long as the fuel used to stoke the fire is some hellish source you could be onto something!

  62. NYUGrad(118083 comments)-
    January 16, 2009 at 6:24 pm

    Please take my analysis with some grain of salt. not intended to be advise. prob more what not to do.

    http://tinyurl.com/448sbq
    Summary of industry action
    Up:
    prec metals
    renewal/alt energy
    tires
    airlines

    down:
    Banks
    trucking/transport
    autos/auto parts

    not too shocking as Obama plan is coming to town Tuesday.

    Still holding my slw; want to see where its at after 3pm. not touching banks. watching my solar basket, vmw, dig, uco, drys, goog, bidu

  63. bobbyo(118083 comments)-
    January 16, 2009 at 6:24 pm

    Dow Chemical i am confused about the Rhom Haas deal. I believe it would be a positive for DOw if the deal did not go through due to over paying, yet Dow went down when the deal seemed in jeapordy. Anyone have insight into this

    I broke my year long policy of not owning any financials yesterday and got burned. Just a comment on being disciplined and following your own trading rules.

  64. jock(118083 comments)-
    January 16, 2009 at 6:29 pm

    Once again, silver stocks are the best performing of 208 morningstar sub-industries, and mining the best major industry of 31. That’s the good news; bad news is that silver stocks are up 101% since 11.20, and were earlier up 120%.

  65. alberio(118083 comments)-
    January 16, 2009 at 6:30 pm

    ELD.TO 50DMA x 200DMA yesterday and K.TO will do so today barring a collapse into the close.

  66. Ron Sen(118083 comments)-
    January 16, 2009 at 6:39 pm

    What would restore trust in the financial system?

    Maybe if we could go a couple of days without a new alphabet soup bailout…
    “aggregator bank”…isn’t that a new name for the toxic waste dump proposal from the beginning? The taxpayers simply spend trillions to buy the crapola that nobody else will buy? Huh?

    • Finger Lakes(118083 comments)-
      January 16, 2009 at 6:57 pm

      Sure,
      It’s the lie, cheat, and steal and then screw the taxpayer strategy.

      Works nearly everytime it’s tried.

      We were at 8.5 trillion before the new BAC bailout and before the Obama stimulation package.

      Who wants to bet they’ll keep running it up until they get cut off?

      Rob.

  67. Scott(118083 comments)-
    January 16, 2009 at 6:50 pm

    Curious if others think they are useful and if so – to what degree? Thanks.

  68. Finger Lakes(118083 comments)-
    January 16, 2009 at 7:02 pm

    It’s pretty funny how these banks’ professional trading desks have been announcing huge trading losses this quarter.

    Looks like they are as dumb as they are dependent on Other People’s Money to survive.

    Rob.

    • bigwad1(118083 comments)-
      January 16, 2009 at 7:06 pm

      What about all those hedge funds that aren’t being regulated?
      Just a matter of time before that Pyramid scheme has the coconut shell lifted off it.

  69. bigwad1(118083 comments)-
    January 16, 2009 at 7:14 pm

    How are the working people that aren’t even born yet going to grow up and join the work force and like paying 50 or 60% of their earned income to a government that gave their taxed money to a bunch of greedy bankers 20 years before they were even born?
    Will they thank Paulson and the rest of the socialist elite?

    • Finger Lakes(118083 comments)-
      January 16, 2009 at 7:19 pm

      It’s possible many people in that generation will choose not to work and just live off the government.

      If it’s good enough for the banks why shouldn’t the little people do it too?

      Of course, this all depends on a never-ending line of people willing to buy our bonds.

      Rob.

  70. 2nd_ave(118083 comments)-
    January 16, 2009 at 7:17 pm

    still think +1000 is not out of the question…

    • Finger Lakes(118083 comments)-
      January 16, 2009 at 7:20 pm

      You’re not talking about today are you?

      That would really surprise me.

      Rob.

      • 2nd_ave(118083 comments)-
        January 16, 2009 at 7:30 pm

        Rob- LOL..i’m not about to call the timing other than to say i think investors are looking for a reason to jump in…the Obama rally talk has been overdone, but it has also been plastered with ridicule/skepticism and killed off, which IMO gives it a chance to play out…

        • Finger Lakes(118083 comments)-
          January 16, 2009 at 7:47 pm

          2nd,
          Me either. I could see the scenario where we could climb the wall of worry.

          Most investors are very doubtful right now. We’ll just have to see how many can be compelled to chase prices higher when we do start another rally.

          I’m still thinking about buying some F in anticipation of the bounce. They’re still refusing TARP money, even after Chrysler accepted 1.5B today.

          Any company who refuses a taxpayer handout has to be a good company right?

          Rob.

    • OldGoat(118083 comments)-
      January 16, 2009 at 7:22 pm

      Looks that way on 5-minute ESH9 (SP500 futures) chart w/ MACD(5,30,9). Long ES. Tried to add on last pullback, but limit order missed by .25

      • QT(118083 comments)-
        January 16, 2009 at 7:46 pm

        OldGoat

        ESH9 <— never saw this symbol. By chance do you know its equivalent on StockChart.com?

        • OldGoat(118083 comments)-
          January 16, 2009 at 8:20 pm

          ES is the ticker for the Globex E-mini S&P 500 Futures contract. H9 is the designation for the (current) front-month (March2009) contract. It charts just like SPX (the index), except that it trades continuously 24/7 (except for Fri pm thru Sun late afternoon and also closes briefly daily after hours, then reopens for overnight session.) See:
          http://www.cme.com/trading/prd/equity/emini-sp500….

          • QT(118083 comments)-
            January 16, 2009 at 8:34 pm

            OldGoat Thanks for the info. I appreciate it!

          • OldGoat(118083 comments)-
            January 16, 2009 at 8:45 pm

            Here are the Globex trading hours:
            http://www.cmegroup.com/trading_hours/

            Futures give you massive leverage, and the ability to trade when equity markets are closed. Commissions are very small (with IB, at least), as are margin requirements. Liquidity is exceedingly high. You can make or lose a lot of money in minutes (or seconds). Contract moves in 1/4 point increments. 1/4 point=$12.50US. Bid/ask spread is typically 1/4 point (but often 1/2 point or more after hours).

          • QT(118083 comments)-
            January 16, 2009 at 8:47 pm

            “You can make or lose a lot of money in minutes (or seconds)”

            Think I will observe from the sidelines for the time being. Sounds like a shark tank full of great whites. 🙂

          • OldGoat(118083 comments)-
            January 16, 2009 at 8:57 pm
    • Chickenpookie(118083 comments)-
      January 16, 2009 at 7:58 pm

      “still think +1000 is not out of the question…”

      Perhaps post-inauguration? There will be 40k security personnel assigned to the DC area for the event. The largest mobilized security action since 911, most bridges in and out of the city will be closed and the surrounding waters heavily patrolled. The only practical means of entering the city will be by subway system and the bars will be open 24hrs. There are quite a few people nervous about the event…

      • yvrapx(118083 comments)-
        January 16, 2009 at 8:07 pm

        CP Am sure there will be plenty of precaution taken but with all the firepower I would feel pretty safe. IMHO think it will be a definite cause for celebration and if there is one thing that is dire need right it is hope. Would like to be there for the history AND party, sounds like one of those events to tell my son about in 20 years.

  71. NYUGrad(118083 comments)-
    January 16, 2009 at 7:26 pm

    or can it really go lower into the $20 range?

    Thinking of moving my $ into oils

    • Fazeli(118083 comments)-
      January 16, 2009 at 7:33 pm

      It CAN go anywhere, but I don’t see the demand for Oil dropping enough to send it into the 20s.

      Supply has been massively cut over the past 6 months. Infrastructure spending (which requires lots of oil) is about to skyrocket thanks to governments around the world, and the total Western world retraction will be 10-15% GDP in a depressionary economy! Countries like China and India are still growing!

      Hence, the back-of-the-napkin math tells me that Oil shouldn’t fall much from here, and has in fact over-corrected! But I said that at around $42 to myself, and here we are at $35, and we may see $30 still! At some point I should really pull up all the numbers to prove to myself that this theory is sound!

      I’m long USO, PGF.UN.

      • NYUGrad(118083 comments)-
        January 16, 2009 at 7:37 pm

        I am also looking as UCO but kind of drawn to DIG, as it has more liquidity.

        Tend to agree oil cant go much lower.

    • QT(118083 comments)-
      January 16, 2009 at 7:38 pm

      NYUGrad

      Why not skim over this article first before you do.

      “Diminishing room to store cheap crude”

      http://finance.yahoo.com/news/Diminishing-room-to-

      • NYUGrad(118083 comments)-
        January 16, 2009 at 8:18 pm

        thx for the contra article. for DIG, the rsi is obviously not oversold. but the daily stoch just got there. curiously the weekly stoch is turning up crossing up thru the oversold line.

        i guess crude could go to $25, but production would halt there no? will do some researching over weekend. but my overall instinct says oil should go higher. i know oil is in everything, and i still consume the same amt as when it was $4 per gallon.

        • Eric(118083 comments)-
          January 16, 2009 at 10:45 pm

          NYU, be sure to share any interesting articles you come across.
          I have spent countless , literally countless hours reading about oil, the industry reports, books, etc. i also feel strongly that it is going higher long term, and to be honest it’s the only thing i can hold with conviction. I got scared out of my GE holding for a 10% haircut (it’s ok, only 100 shrs), I shouldn’t have been there in the first place, I know nothing about GE, nothing. A little discipline could have reduced the loss to 7% which should have been my stop. Arggh. I remember holding CNU.V from .7, buying all the way down, and selling my last lot at .005. No way will I do that again.
          I’m basically too nervous to hold anything other than oil, cash, and some UNG, basically energy is my theme. I find I still don’t have the discipline to trade with the rules necessary to succeed. It is literally a crapshoot, even though I tried using indicators like RSI, I am learning my risk tolerance is not as high as I thought. That and my capital base isn’t large enough to sustain big losses.

          Anyways, oil is very fascinating, and aside from technicals, I feel it is a safe place to put your money at or near these prices. as safe as anything else I guess.

          • NYUGrad(118083 comments)-
            January 16, 2009 at 11:36 pm

            I will surely share all i come across. but lately i do less fundamental and more tech, as i am weak there and want to learn asap. not saying fundamental is not important. but to me right now, less important than the charts and tech indicators and comparisons to other industries and stocks.

            have a good weekend to all.

  72. yvrapx(118083 comments)-
    January 16, 2009 at 7:43 pm

    Whatever happened to the MONKEY?

    • NYUGrad(118083 comments)-
      January 16, 2009 at 7:51 pm

      I was the one that started that. not sure if it was in good taste so i stopped. Bill never emailed me saying that anyone complained but i just thought i would moderate myself.

      Wish i could take a poll, if people here rather i kill the monkey altogether.

      • 2nd_ave(118083 comments)-
        January 16, 2009 at 7:55 pm

        “Wish i could take a poll, if people here rather i kill the monkey altogether.”

        if it works, i’m all for it…and it’s worked most of the time, which is more than i can say for some other systems…

      • yvrapx(118083 comments)-
        January 16, 2009 at 7:58 pm

        NYUGrad I don’t find it in bad taste it was kinda funny, I am for it.

      • Chickenpookie(118083 comments)-
        January 16, 2009 at 8:01 pm

        Monkey good, lucky charm must be used sparingly lest the monkey gods become displeased.

  73. sjk(118083 comments)-
    January 16, 2009 at 7:52 pm

    Looks like Europe is still unraveling…

    http://ftalphaville.ft.com/blog/2009/01/16/51254/a

  74. Finger Lakes(118083 comments)-
    January 16, 2009 at 7:56 pm

    SLW looks very strong today on rising volume.

    It would be great if it was one of the next bubble stocks.

    SLW $20 anyone?

    Rob.

  75. Finger Lakes(118083 comments)-
    January 16, 2009 at 8:01 pm

    It’s looking like resistance at this point.

    Rob.

  76. rosevillebill(118083 comments)-
    January 16, 2009 at 8:02 pm

    Goodbye to these bloodsucking bas^ar&s. I believe a lot of money is staying out of the market until these *&^$%$ are gone from power. Next week should be the tell.

    • bigwad1(118083 comments)-
      January 16, 2009 at 8:16 pm

      Why not just say how you really feel?

  77. NYUGrad(118083 comments)-
    January 16, 2009 at 8:08 pm

    Here’s to a farewell to BUSH!

    MONKEY!

    • vinod(118083 comments)-
      January 16, 2009 at 8:18 pm

      NYUGrad
      “Here’s to a farewell to BUSH!”
      you mean farewell Rally?

      • NYUGrad(118083 comments)-
        January 16, 2009 at 8:20 pm

        no to BUSH. dow +100
        🙂

  78. mikede(118083 comments)-
    January 16, 2009 at 8:19 pm

    Bill
    Did you expect the rally over 850 at end of day because they are pushing it up for the weekend?
    For Obama?

  79. tango6(118083 comments)-
    January 16, 2009 at 8:21 pm

    It’s as though a terrier is shaking this market like a rag doll – first the bulls get shaken out, then the bears. Tough market!

  80. sjk(118083 comments)-
    January 16, 2009 at 8:21 pm

    This is off-topic, but it is great! (and hopeful…)

    From the award-winning documentary, “Playing For Change: Peace Through Music”, comes the first of many “songs around the world” being released independently. Featured is a cover of the Ben E. King classic by musicians around the world adding their part to the song as it travelled the globe.

    Shortcut to: http://www.vimeo.com/2539741

  81. Foz(118083 comments)-
    January 16, 2009 at 8:24 pm

    I think it’s interesting that these ‘Gov’t Gold’ commercials are back. Every time CNBC cuts to a commercial, there it is, with fake phone calls ringing in the background and a narrator talking to you like you’re a child. (“If gold goes to $2000 an ounce, the gold I’m holding in my hands and touching on this table right now would be worth ($whatever).”)

    If I recall correctly, the last time these were running ad nauseum, it preceded the recent leg up in $gold. So, is this company betting on decreasing gold prices to make a dollar profit, or, as my friend suggested, is this company not really interested in selling those coins at all, but rather, do they hope to create the impression of a top in gold?

    • FranSix(118083 comments)-
      January 17, 2009 at 7:56 pm

      The tenour of these gold commercials is one of hokey sensationalism. There’s no guarantee that the coins are numismatic or even 99.99 pure.

      A bullion coin of a one ounce size in US mint issue is being fixed in London. That would tend to prevent an out of control backwardation in gold, should the coins enter circulation at a greater premium. Coins are being minted from 400oz. bars in the Canadian Mint and sold for their higher price. The price is fixed at ~$1085 U.S. To my knowledge, the U.S. mint does not allow access to individuals to stamp out their gold into numismatic coins.

      $99? does it have chocolate inside?

      http://www.gata.org/node/7094

      • Johnny(118083 comments)-
        January 17, 2009 at 8:23 pm

        Accumulating individual gold coins is an expensive way to proceed. Purchasing bags of silver coins or taking delivery of PM contract commodities seems far better. However, I suppose some prefer just to own a gold coin or two and fixing US gold coin prices to the London rate is an improvement over federal register entries.

        • FranSix(118083 comments)-
          January 17, 2009 at 10:55 pm

          Numismatic gold coins have a greater value than unstamped bullion, solely out of the effect of placing a notional face value on a coin of bullion grade gold.

          No saying that the numismatic coin “won’t” retain its value if it fixes its after market value much higher. Silver coins might not retain the same quality, because it is not recognized as money, only a form of metal. The added value of the governmental mint stamped coins render bullion into exchangeable money, though the face value is purely ornamental and trades many times above it.

          But if I was storing coins, then I would keep my gold coins tucked away and have a supply of silver coins to exchange for currency, as it is probably still liquid.

          It would be funny if they stamped out one ounce coins with a face value of “42” but a london fix of thousands in honour of The Hitch Hiker’s Guide To The Galaxy.

          • Johnny(118083 comments)-
            January 17, 2009 at 11:09 pm

            Thanx Fransix, I have considered buying and taking delivery of one silver futures contract to avoid the “premium” on coin purchases. But, the silver bullion would be most difficult for any use other than selling back to the market. I have no interest in becoming a survivalist but have some real PM around is a bit comforting. It must be The Kaimu Effect (TKE).

          • FranSix(118083 comments)-
            January 17, 2009 at 11:12 pm

            I suppose eventually I could buy some bullion, but would probably like to see it stamped into coins. But you know, there is no way any gubmint can impound the gold in the ground of a gold mine, or prevent its eventual production and sale, especially out-of-country.

            Oh yes, I forgot. The coins would require the bust of ‘Heartybartflast.’

          • Johnny(118083 comments)-
            January 17, 2009 at 11:17 pm

            I couldn’t resist “This is victor immature, reporting from North Bay, Ontario, where the conservative heartybartflast has landed.”

          • FranSix(118083 comments)-
            January 17, 2009 at 11:22 pm

            I’m not going back.

  82. yvrapx(118083 comments)-
    January 16, 2009 at 8:25 pm
    • 2nd_ave(118083 comments)-
      January 17, 2009 at 1:40 am

      yvrapx- thanks for the link…absolutely remarkable- it took less than one paragraph for me to forget i was reading a commentary from 1974, thinking it was written in 2008…would recommend anyone born before 1964 read it, you’ll recognize the backdrop-> copying your tinyurl here: http://tinyurl.com/5nkavk

      the seventies flashback is no illusion…heck, Neil Young’s documentary of the 2006 CSNY tour (titled Deja Vu) just came out on DVD-> they’re older, but some things haven’t changed…Neil is (jokingly) hit by an interviewer at one point with (paraphrased from memory) “Does your band have a lock on war protests? You had Vietnam, can’t you let someone else have Iraq? Isn’t it someone else’s turn now?” LOL…

      • yvrapx(118083 comments)-
        January 17, 2009 at 5:12 am

        Your very welcome 2nd_ave that was the response I was hoping for. I actually sent the link w/out a caveat, my brutal typing skills often hit the send button inadvertantly. The caveat was to see the piece for what it is, we aren’t the first to go through a depressing, wrenching, displacing and ruinous period. As well it is for fund salesmen, planners etc. as a sales piece but the content is what matters. We learn from Bill, we learn from the market and we learn from each other but the biggest lesson is to understand we have an unlimited capacity to rebuild, create and reflect. It will get better, my son’s generation is counting on us.

  83. David(118083 comments)-
    January 16, 2009 at 8:27 pm

    I am seeing some interesting action in the market today: the CPI for 2008 was reported to be the lowest since 1954, and gold is rallying big time. Why would that be?

    Also, BAC just got some gov’t money. Does anyone know the exact terms of the offer? Is gov’t getting some stock in return (thereby hurting the current common stock holders) or is just giving a present to BAC (thereby helping the current common stock holders)? What about the bailout of C? Did gov’t just give free money to them or did they ask for something in return?

  84. OldGoat(118083 comments)-
    January 16, 2009 at 8:29 pm

    http://futuresource.quote.com/charts/charts.jsp?s=

    Link can be used for most other futures contracts as well; just select which contract at bottom of page.

    Note: NEVER trade futures off a delayed chart. Not ever.

  85. dr.cosa(118083 comments)-
    January 16, 2009 at 8:31 pm

    HOU (oil x2 on the TSX)
    wow.

    w/ gold jumping its not looking too hot.
    but this appears to be even more volatile than the HGU for gold when oil gets moving.

    i feel good holding a portion of my total position in HOU at the moment as a single geo-political event over the weekend could send crude higher, where as few things can happen over a weekend to send crude violently lower. imho.

    but i dont think $25 oil is out of the question at all simply becuase no one thought we’d be back to $50 oil, then $40 and now we are broaching $30. oil is still being pumped just as it was when crude was on the way up through $40 and $50 a few short years ago.

    Low oil prices have been used by the powers that be to starve out their enemies many many times before, especially in the past few decades, for americans they tend to benefit from lower prices while russians, venezuelans, and iranians suffer. badly. its win win for the global juggernaut, and not out of the question that collusion is as responsible for the rise and fall of crudes price this past year…

    good luck

    • yvrapx(118083 comments)-
      January 16, 2009 at 8:37 pm

      dr.cosa excellent pick. Caveat the HOU needs to be ACTIVELY traded was $16.69 10 days ago it now 1/2 that DYODD

  86. David(118083 comments)-
    January 16, 2009 at 8:31 pm

    Looks like a short squeeze in UXG is about to happen (from what I have seen, after a beat up junior explorer shows some signs of strength, it usually makes an amazing moonshot before sinking down further). I am placing sell limit orders at $1.49 and $1.69 for the shares I purchased at $1.10 and $1.30 in August/September.

    • Seamus(118083 comments)-
      January 16, 2009 at 8:35 pm

      FWIW, Saw a Vicker’s report earlier today . . don’t recall seeing one on UXG (no position)in the past . . . looks like McEwan’s been buying . . . now holds 12.0696 milion shares

  87. David(118083 comments)-
    January 16, 2009 at 8:47 pm

    I am not liking the fact that oil is down now while the general market is up. I just sold 1/2 of my UCO at $11 and placed a buy limit order at $10.

  88. QT(118083 comments)-
    January 16, 2009 at 8:53 pm

    daily / weekly / monthly setting up for a rally Tuesday

  89. NYUGrad(118083 comments)-
    January 16, 2009 at 9:03 pm

    still holding slw. liked how it closed near the high. was stronger vs it’s peers and sector’s performance for the day.

  90. Grym(118083 comments)-
    January 16, 2009 at 9:11 pm
  91. QT(118083 comments)-
    January 16, 2009 at 9:12 pm

    Calif. tax refunds to be delayed starting Feb. 1

    SACRAMENTO, Calif. (AP) – California’s controller says he will begin a 30-day delay on tax refunds and other payments starting Feb. 1 because the state is running out of money.

    Controller John Chiang said Friday he must delay $3.7 billion in payments next month because lawmakers have failed to address California’s growing deficit.

    With a $41.6 billion shortfall over the next year-and-a-half, the state is on the brink of issuing IOUs.

    Chiang says his office must continue education and debt payments but will defer money for tax refunds, student aid, social services and mental health programs.

    A severe drop in revenue has left the state’s main bank account depleted. The state had been relying on borrowing from special funds and Wall Street investors; those options are no longer available.

    • NYUGrad(118083 comments)-
      January 16, 2009 at 9:16 pm

      That is not right! I hope california can also add some interest payments on those late refunds.

      we all work hard and are forced to pay taxes, insurance, ss, before we touch 1 cent. we loan the govt money on the refund we are supposed to get, at no interest. now they want to delay them?

      i will be filing 1st chance i get once i have all my paperwork. glad i dont live in the sunshine state.

      • Chickenpookie(118083 comments)-
        January 16, 2009 at 9:26 pm

        “That is not right! I hope california can also add some interest payments on those late refunds.”

        Golly gee Wally, that sounds like default. Just think of the red-lettered nasty-gram you’d receive warning you of the penalties if you didn’t pay your income or property tax…. The fees wouldn’t easily be forgiven unless you were of high stature.

        • nemo(118083 comments)-
          January 16, 2009 at 9:48 pm

          Poor w-2 people. I always loved how the Feds tell you to pay 110% of your last year’s tax liability..NOT

      • vinod(118083 comments)-
        January 16, 2009 at 11:32 pm

        2nd
        Other Voice
        At least you guy will get whole dollar back; any other placed it may be 40C or 60C.
        So, all people in California should pay fees to state government for safe keeping the refund

    • 2nd_ave(118083 comments)-
      January 16, 2009 at 9:24 pm

      QT- this would be a good year for all of us to file for automatic extensions citing the Madoff ripple effect…

  92. daydreamer(118083 comments)-
    January 16, 2009 at 9:13 pm

    I sold 17.5 puts on PFE the stock closed at 17.5, will I be assigned. Also had call on 50 RIG call stock closed at 50.09 will stock be called away?

  93. Grym(118083 comments)-
    January 16, 2009 at 9:13 pm

    WSJ today pg11 (Also on website, I’m sure.)

    A comparison of ATLAS SHRUGGED, by Ayn Rand and today’s wacky government programs being offered as a fix for the previous Wall ST/Washington “creative thinking” and Obama’s plans of “change” to come.

    Trust is not a likely outcome, IMO.

  94. EDC(118083 comments)-
    January 16, 2009 at 9:15 pm

    two cents…

    Gold is up on fear of more printing to support the system, nothing more than an emotional daily trade. Expect it to go lower to 700s and eventually get a 6 handle. deleveraging is only in the 3rd inning, maybe…

    oil – everyone will be continually surprised to see how low it goes… lets put it like this, there are banks that have nowhere to put delivery of contracts bought over the summer… can you say oversupply? sure we can, oversupply. Don’t be amazed to see $1 gas and perhaps oil in the low 20s or teens. I said 35 in october or november, got laughed at.

    s&p – 1000 for obama rally, fat chance, maybe after we break/crush the lows of november. Expect some goodness early next week, then bickering and jawboning on capital hill and from the fed. the CONgress people will want to argue over their pork for their friends in high places and this will do nothing more than delay the “stimuli” bill (waste of money, government can’t create jobs just misallocate capital or take good capital and put it in bad places; hence all the worthless actions done in the past 13 months that have done nothing but we have seen equities to continually drop). Once February comes along, they may be this bill passed and it will take a while for the effects to catch steam (don’t tell me markets are forward looking, market hasn’t been right since the 2002/3 recession turn, it was behind that, so markets haven’t been forward looking since the 90s).
    after the pain is taken and we get lower, we could see the s&p rally to 950-1050, then break lower because we will realize that it is not working as advertized, then rally again to a higher number 1000-1100 ish and then really realize that nothing is working because of social mood has shifted no thanks to the paradox of thrift.

    then we will eventually find ourselves in the following year to lower lows, that haven’t been seen in a decade in a half.

    call me crazy but that is how i see it.

  95. Lori Smyth(118083 comments)-
    January 16, 2009 at 9:23 pm

    Ok, what is IMO an acronym for please?

    • Miadhach(118083 comments)-
      January 16, 2009 at 9:37 pm

      Lori Smyth,

      In My Opinion

  96. jack black(118083 comments)-
    January 16, 2009 at 9:25 pm

    Another day with interesting shape of the intraday chart. Is this supposed to mean something?

    BTW, I almost reached my exit targets for my GG and TNA. Maybe on Tuesday? I’m weary to be long at this juncture as I believe more selling is ahead.

  97. tango6(118083 comments)-
    January 16, 2009 at 9:29 pm

    plus 70 is not too shabby after today’s action, but that caps another losing week (-320 … -720 since the turn of the year) so if you are ahead on your longs after all that, you get an A+.

  98. tango6(118083 comments)-
    January 16, 2009 at 10:07 pm

    is folding its 500+ stores.

    • Finger Lakes(118083 comments)-
      January 16, 2009 at 10:23 pm

      And laying off 30,000 workers unless some of the stores are taken over by rivals.

      That’s another huge chunk of people who won’t be adding fuel to the stock market fire.

      Rob.

  99. Dr. Strangelove(118083 comments)-
    January 16, 2009 at 10:15 pm

    Mish’s take on oil is hard to refute.

    http://globaleconomicanalysis.blogspot.com/2009/01

    • David(118083 comments)-
      January 17, 2009 at 1:23 am

      Hm… If the supply of oil at Cushing keeps increasing, it is hard to expect the WTI price to rise. Maybe the right way to play the oil game is to start buying USO/UCO only when the supply at Cushing stops growing. Does anybody know of a source for checking daily supply changes at Cushing?

      • 2nd_ave(118083 comments)-
        January 17, 2009 at 2:05 am

        David- do you recall the unending reasons rolled out by the media why oil should go higher when it was at 140? every momentary interruption in supply/increase in demand (Nigeria, Venezuela, tropical depression(s), summer driving season, peakoilpeakoilpeakoil) was enough to squeeze the shorts another buck or two…in retrospect they were signs of a top…

        now we’re starting to see (IMO, some pretty esoteric) reasons why oil should go down…i don’t think longs are as prone to panic (unless they bought >100), but i would expect there will be attempts to drive prices down every bit as ‘clever’ (and successful) as the attempts were to drive them up…

        • David(118083 comments)-
          January 17, 2009 at 4:09 am

          You are absolutely right, 2nd_ave — at the bottom of the oil price, the media will be full of very good reasons as to why oil should be going much lower. But the mere presence of such reasons in the media does not indicate that we are at the bottom.

          After I wrote about waiting for the supply at Cushing to stop growing, the thought had occurred to me that maybe the supply growth is the *result* of the oil price going lower (as it motivates the traders to sell a forward contract now and lock in a risk-free profit by buying and storing oil now). After all, the supply at Cushing has been growing pretty steadily since July, but we did have a rally in the oil price from $35 to $50 a few weeks ago. I will still try to find out this weekend a source for monitoring on a daily basis the supply at Cushing.

          At the end, the price action itself might be the best indicator of where the oil market is headed. I didn’t like the fact that oil price fell today despite a rising market. USO seemed like it made a double bottom a couple of days ago, but now that the oil has turned down again, USO might very well break its support at $29, in which case it will most likely fall a few more bucks. So I am inclined now to place a sell stop limit at $10.90 for my remaining UCO shares, with the intent of repurchasing them at a lower price (but I’ll keep my USO shares).

  100. Dr. Strangelove(118083 comments)-
    January 16, 2009 at 10:22 pm

    I suggested ECB easing would rally the Euro and weaken the USD. Strange but it’s happening that way today after the initial drop on the Euro yesterday. Good sign for PM like SLW and GG. The USD rallied after the Dec 15 easing and now it’s the Euro’s turn? Am I nuts or does this make some sense?

  101. Bear E(118083 comments)-
    January 16, 2009 at 10:32 pm

    GRYM, Your #6969 post was not tooting your own horn. The lifestyle you chose and your methods were solid and still work today. Sharing ideas and wisdom benifits us all.
    My #1 rule of business is to help people. I look for win win situations.
    Not after fast money. I try to invest my $. Stock market has been rough. Like Mr. Cara says, trade prices.
    Still smiling out here in sunny CA.
    Bear E

  102. seadog(118083 comments)-
    January 16, 2009 at 11:29 pm

    Can anyone advise me on what method of calculation Bill uses in his determination of RSI, i.e. does he use the close, open, high or low? I ask this because I get different valuations between my charting software and the value reported on billcara2, marginal but enough to add or delete some stocks from my scan. TIA.

  103. Ron Sen(118083 comments)-
    January 17, 2009 at 1:26 am

    http://tinyurl.com/7tjczj

    Hope gone wrong.

  104. goatmtn(118083 comments)-
    January 17, 2009 at 5:57 am

    Though not anything you can trade on, I find the outcome of the thread between some esteemed community members a significant event for this community. My hat is off to you! (see comments 7085,7084,7081,7079,7001,6996,6992,6976)

    My hat is also off to Bill for having the patience to allow it to happen.

    cheers,

    doug

    • NYUGrad(118083 comments)-
      January 17, 2009 at 6:29 am

      I agree. as this blog grows it is going to be more important for individuals to compromise ego and really make the effort to communicate on a professional level, no matter what religion or other views each of us holds. Self moderation.

      As i tell Bill, it is a privilege for all of us to read, let alone post here, for free! just think “millions of people are about to read this post and i am paying zero,” before you hit that [save] button.

      Last thing anyone wants is a fist sandwich in the Bahamas:)

    • photogray(118083 comments)-
      January 17, 2009 at 7:25 am

      Thank you both for not escalating into a flame. I got singed some days ago and its still painful. And good on you Doug
      peace from north puget sound

  105. NYUGrad(118083 comments)-
    January 17, 2009 at 6:27 am

    As usual i am open to correction, since i would like to learn. sorry for the use of the red and green vertical lines. my rookie eyes need them to pinpoint correlation of a indicator at a certain time, in relation to the pps. Green line = buy signal. red line = sell signal based on stochastics

    Of all the time series indicators, daily stochastics seems to work well for SLW. if you view the red arrows on the attached chart, you will see oversold stoch rolling up and crossing through the oversold line, on its journey uninterrupted all the way to the overbought line. only two times did the journey not reach the oversold line, the move at the end of Oct 2008, and the one that started today which is still in progress. But as you can see,even on the oct 08 move, the stoch signal was the start of some great price increases.

    Stochastics rolling over from overbought line and even above the 50 line, also has been great sell signals. every instance of it, SLW took a significant hit in pps, except late dec 2008 (several weeks ago).

    CMF also has not been positive in a while and today showed a nice sharp increase.

    $4.60 usd looks like solid rock bottom support. $5.75 and $5.25 near term support.

    I think SLW goes higher near term. But that would need precious metals to gain and a modest usd.

    I am not giving targets as i dont want this to be taken as advice. Just displaying my analysis of the chart and my opinion from collective learnings here and elsewhere the past yr, for critique or correction.

    Disclosure: holding SLW. this weeks trading activity earned me 800 free additional shares.

    Enjoy your weekends!

    • kar(118083 comments)-
      January 17, 2009 at 1:24 pm

      Well done NYUGrad. I’ve been waiting for SLW to come to me for quite a while (being a very cautious novice type). Your analysis confirms my feelings about SLW support levels. I’ve missed too many entries and run-ups due to my typically cautious stance borne out of having been badly burned by ‘chasing’ price up in the past. I may have to ease a little on my fear threshold to play this game better. I’m not an options trader — yet — wish I was. Appreciate your analysis!

    • Johnny(118083 comments)-
      January 17, 2009 at 2:56 pm

      Great charts and insight NYU. Thank you! I still hold 1k strike 5 Jun 09 calls on SLW and fully expect a good ending.

    • NYUGrad(118083 comments)-
      January 18, 2009 at 7:22 pm

      Part II

      So far it has been fairly easy. Many here have talked about why SLW is a great potential investment, especially myself.

      But i missed the Sept 07- Jan 08 run up from $10-$19 usd. And i wanted to look at what worked and didnt work as indicators then. Was Stochastic a solid indicator as it has been for me the past few weeks? the short answer is no! the trading was wide and lose, and if I were to have only used stoch, i would have missed the top as well as prob participated in more losses than i would want.

      See attached jpg. Again, sorry for such a butchered chart. i am still learning.

      But the overall picture i get was that stoch was a pretty good buying tool, the selling decision needed to be made by also looking at macd (divergence) and 30/50 day moving age. meaning if stoch said sell, but macd was rising and had positive divergence, maybe the sell could come a few sessions later, vice versa.

      I still haven’t figured it out so i will continue to stare at it. I am just preparing myself for the next bull leg up on SLW and want to try not be on the train on the downside moves.

      The end of sept 07 looked especially challenging as all indications was to sell on that 1st dotted red line. but if i did, i would have missed the move from $13.50 to 15.50 range, as well as the bigger move to $17.72. But stoch and macd would have worked well in capturing the Dec 07 – Jan 08 $14 to $19 move.

      Hopefully with quantitative easing the escalator up will be less seesaw and more hockey stick this time for precious metals, but i am preparing myself for a bumpy ride compared to the recent trading behavior.
      http://tinyurl.com/8scw8g

      **this is not investment advice. just showing my logic so i can learn from mistakes and win on my future trades.

      EDIT: also the 1st Aug 07 stochastics buy signal was early. as the stock dropped from there to $10.63, before making its move; macd would have saved me as it was still dropping like a rock and hadn’t reversed up yet. yeh those several months were tricky.

      Also missed a red Sell line for Nov 2007. Stoch and Macd were in unison on saving me from a painful ride down from $17.72 to $14.50.

  106. David(118083 comments)-
    January 17, 2009 at 7:46 am

    I just listened to the latest Don Coxe’s webcast and was a bit appalled about his statement that the economic recovery from this bear market might have to happen without the banks leading the way, since they are in such a bad shape now and are so dependent on the government. He also mentioned that whenever the $BKX index made a relative low against the S&P 500, a sell-off in S&P would always take place. So he said that he will not be surprised to see a new low in the Dow and S&P in the next few months. All this points out to the possible continued downside for UYG. So I am preparing to take a minor loss on the 500 shares of UYG I purchased on Thursday at $3.97 by placing a tight stop limit order for Monday: stop at $3.72, limit $3.7. However, I will keep the 550 shares I purchased at $3.80.

    • David(118083 comments)-
      January 19, 2009 at 12:41 am

      I just read Bill’s Saturday report, which was very optimistic. He also reminded me that the major banks were down on average 35% this week. During the past year, even though that everyone knew that things will get much worse for the banks, they still had many amazing rally weeks. So why can’t we have an amazing bank rally next week? After all, the November 20 low on UYG at $3.75 did hold after 2 days of testing. So I now think that the way to sell UYG is not with a sell stop limit below the current price but with a limit price above the current price. So I placed sell limit orders at $4.41 and $4.80 for the two “lots” of UYG shares I purchased on Thursday at $3.80 and $3.97.

      • swissrobinson(118083 comments)-
        January 19, 2009 at 8:05 am

        >During the past year, even though that everyone knew that things will get much worse for the banks, they still had many amazing rally weeks. So why can’t we have an amazing bank rally next week?

        I bought a small regional bank I know is well run from Orgeon, UMPQ. It’s in accumulation zone and hitting lows I like but it barely budged on Friday. I’m hoping for a better run on Monday.

        But these banks that were thought to be solid (AIB, a great Celtic tiger and East European play) are riddled with corrupt management, word of which only gets out when the s%&G hits the fan. I’m starting to appreciate analysts’ advice to avoid the sector.

        Here’s to successfully reverting to cash this coming week.

        Les.

  107. swissrobinson(118083 comments)-
    January 17, 2009 at 12:56 pm

    Bill’s put the foot down. It had to happen, as human beings we have a tendency to push the limits.

    FWIW, I understood where both sides were coming from although Jock, you were pulling no punches with that PNG. I think we all saw the lighter side of that response and I for one was LMAO, but not at Sharky’s expense.

    I took Shark’s comments at face value but with a history (Big Brother records everything) of inflamed passions and cynicism (not necessarily a bad thing), you were setting yourself up for a rebuke with that ambiguous remark.

    The zero tolerance policy is welcomed for the reasons stated by Bill, but I don’t want participate in a community that blows sunshine up each others’ butt either.

    I for one welcome caustic remarks at my expense if merited and productive in my learning and life experiences (having started life in the Infantry, I can belt it out with the best of them).

    Rock on.

    LE.s

    • Bill Cara(118083 comments)-
      January 17, 2009 at 2:35 pm

      My policy shift has nothing to do with caustic remarks and was done before I became aware of anything between Jock and Shark. The previous day, I received letters from several people that showed me they were tormented over what they had been reading on several fronts here, and I had to spend an hour of valuable time to edit and delete stuff. I REFUSE to do this any more. When I feel like having to shower after reading some of the crap that some people think they can post on our doorstep; then clearly the nonsense has gone too far. I have had it with letters from good people telling me they are no longer coming here because of the stuff they read from certain people. There are people from every ethnic and cultural background, sex and sexual orientation, ability or disability, and so forth, and they are not coming here to be offended. They expect to find the positive values that I espouse. So, no more warnings. It happens any more and the rest of you will be left wondering what happened to so and so. This is a heads-up; don’t think twice because you’ll know why. No further comment, and no further re-accepting of banned persons. Life moves on.

      • kar(118083 comments)-
        January 17, 2009 at 3:38 pm

        Thank you Bill. No one that blogs here is indispensable, no matter how learned regarding the market or how much value they may have to offer others on your blogs’ purpose and operating principles. You are much too valuable a mentor than to be wasting your time deleting other peoples egos.

        • Bill Cara(118083 comments)-
          January 17, 2009 at 4:24 pm

          kar,

          Thank you for your comments. All of us have biases and ego issues, but it is the measure of a person to be able to overcome them and provide value to those we can. There is nothing to be gained by hurting people, but a lot to lose. I’m not a loser, and I don’t want anybody who comes here to be a loser. Together, as independent persons, we can build a strong community.

          • proudPapa(118083 comments)-
            January 17, 2009 at 9:13 pm

            For those so inclined, here’s a cute video of an unexpected animal friendship. It’s unfortunate humans can’t accepted our differences and just get along this well…

            http://www.youtube.com/watch?v=qs_a98AySNk

  108. bsi87(118083 comments)-
    January 17, 2009 at 1:44 pm

    RSI triple screen shows accumulation. Nice kangaroo tail reversal yesterday (candlestick pattern per Elder). Up more in last hour vs the first 30 minutes. Pickup in volume over 10 day average. Max pain shows 16 for Feb and 20 for Mar.

    Buy limit 13.51 with a stop under Friday’s low.

    No position, do your own homework.

    • teamonfuego(118083 comments)-
      January 17, 2009 at 4:02 pm

      bsi – i must admit that i thought the action in GE yesterday was impressive. I would have liked to see better volume though and am still somewhat bearish on the company b/c of their financial woes.

  109. Ron Sen(118083 comments)-
    January 17, 2009 at 1:55 pm

    http://tinyurl.com/8bujco

    Steely Dan.

    Point-and-figure charts.

    Mean reversion?

    Transparency?

  110. bsi87(118083 comments)-
    January 17, 2009 at 2:13 pm

    Great chart location. I’ve been watching LT trendlines. None violated to upside, meaning watching for extreme oversold potential buys and shorting at resistance. Fewer trading opportunities and not much LT buy and hold.

    http://decisionpoint.com/ChartSpotliteFiles/090116

    • Johnny(118083 comments)-
      January 17, 2009 at 2:40 pm

      Thank you bsi87. This adds further fuel to the belief of myself and others on this blog who expected a brief up move and continuing decline.

  111. Ron Sen(118083 comments)-
    January 17, 2009 at 2:23 pm

    Sorry for writing so much.

    http://tinyurl.com/7jjmcp

    Meet the new boss, same as the old boss. I am way off base here?

  112. Johnny(118083 comments)-
    January 17, 2009 at 2:26 pm
  113. 2nd_ave(118083 comments)-
    January 17, 2009 at 2:48 pm

    after discovering this brewery/restaurant on 2nd Street (about 3 blocks from the entrance to SBC Park, home of the Giants) last December at a company Christmas party, i’ve been back twice…you can hang out after work/on weekends at wooden tables piled with fried calamari, ribs, pizza/sandwiches/burgers (dinner menu includes rib eye, lamb or pork loin, even came across Ahi sashimi appetizers once) and sample the brew-> at 7.2% to 9.8% alcohol content, it doesn’t take long for the house ale to straighten you out…(they’re celebrating the inauguration next tuesday with [canned] beer @ $2 all day…i’d skip the canned beer and go for the IPA)…

  114. Chickenpookie(118083 comments)-
    January 17, 2009 at 2:59 pm

    So then, since BAC’s market cap was ~70B last month and today it’s about half that, doesn’t this indicate that money has moved out of this equity to somewhere else???

  115. 2nd_ave(118083 comments)-
    January 17, 2009 at 3:25 pm

    http://tinyurl.com/54qccl

    Gold: looking for prices to test resistance at 900…

    Crude: expects the price of Brent to respect resistance at 50 (closed at 46.57 Friday), which would signal another test of support at 40…

  116. 2nd_ave(118083 comments)-
    January 17, 2009 at 3:29 pm
    • David(118083 comments)-
      January 17, 2009 at 10:40 pm

      The sentiment in October/November was very unusual — the financial system came to a halt, the CDS market started unwinding, all big players needed to raise cash, and there was no way to know how low the hedge fund selling would drive the market. I don’t think we need to “trump” that sentiment at some point.

      I am not saying that we won’t establish new lows in 2009, but if we do, then the sentiment at the new low might still be more optimistic than what we saw in October/November.

      What do you personally think about it, 2nd_ave?

      • 2nd_ave(118083 comments)-
        January 18, 2009 at 2:56 am

        “The sentiment in October/November was very unusual — the financial system came to a halt, the CDS market started unwinding, all big players needed to raise cash, and there was no way to know how low the hedge fund selling would drive the market. I don’t think we need to “trump” that sentiment at some point.”

        David- I don’t think it would be that difficult to trump, and I think we do. But perhaps later rather than sooner. The great unwind of 2008 was abrupt, and people are generally quite resilient when it comes to dealing with the immediate aftermath of painful events. The real drop in sentiment will not occur until later in the cycle, if/when it becomes evident recovery is a long ways off. Real depression sets in as reality slowly grinds away at hope. Now that’s IF, not WHEN. I can’t predict how the recovery plays out or when it happens. In the near term, I think we have a good shot at a rally, and we should all sell into it. Mean reversion, the natural human inclination towards optimism, the concepts of (re)action and constant change, yin/yang, and all kinds of other observations about human nature/behavior/history/assorted bull—-, all point to a significant rally at some point. If it was possible to discern the turning point, we would wait patiently for it to arrive, bet it all, and plan to buy rounds all summer in eastern massachusetts, right? But going back to observations about human nature/behavior/history/assorted bull—, I know that’s not going to happen. UNLESS, maybe, we all decide to bet the house on 0/00 the day both you and Vinod make the call.

        • Johnny(118083 comments)-
          January 18, 2009 at 1:50 pm

          2nd, I can envision a continued little bounce here. Call it the Obama effect everyone is expecting or just a breather from all the down days. But, those 500,000+ unemployment numbers are like a rock in the stomach. Earnings reports are another ball and chain, continued bad news from the global economy, you know the rest. What relief is there, to take this market much higher after after noon on Friday 1/23?

          • 2nd_ave(118083 comments)-
            January 18, 2009 at 3:25 pm

            “What relief is there, to take this market much higher after after noon on Friday 1/23?”

            Johnny- There is no (foreseeable) relief, and sometimes that’s all it takes. Investors give up, sell out, and the selling ends. Buyers (those willing to bet a few weeks/months/years out) come in and take the market up- these would include many shrewd LT investors (‘strong hands’) opening or adding to multi-year positions. The initial sustained upward moves draws in speculators (‘weak hands’), and before you know it, the game is on. Bill pointed out there were 5 substantial rallies during the Great Depression- that’s human psychology working its way through the economic recovery. We may get a rally to sell into soon enough, followed by a second spike down to buy into (or if you wish, to initially short before buying into), a second rally to sell into, a third spike down to buy into…the weak hands guarantee high volatility and sharp moves, and the strong hands (hopefully) provide support levels…

            There’s money to made in the markets, but it’s never easy. If good traders know when to buy, and great traders know when to sell, then both of the above along with the rest of us who survive all learn how to persist in the game when they’re down-> there are good/great traders who went down last fall (some quite publicly), but they will work their way back and succeed. Personally, my definition of a good trader is simply one who stays in the game. Using the 80/20 rule, 80% of traders drop out. Of the remaining 20%, 80% will succeed, but perhaps not spectacularly. That’s good enough for me.

          • Chickenpookie(118083 comments)-
            January 18, 2009 at 3:31 pm

            2nd – “There is no (foreseeable) relief, and sometimes that’s all it takes.”

            I agree with the train of thought, now we just need to concentrate on the timing and capital preservation.

          • 2nd_ave(118083 comments)-
            January 18, 2009 at 5:51 pm

            “There is no (foreseeable) relief, and sometimes that’s all it takes.”

            CP- reminds me of a great line from the film Appaloosa (just out on DVD, and recommended): “..but life has a way of making the foreseeable that which never happens, and the unforeseeable that which your life becomes.” in trading, as in life (ie, in the marriage, the job, the weather, the casino), expect the unexpected…

          • swissrobinson(118083 comments)-
            January 18, 2009 at 7:07 pm

            >I agree with the train of thought, now we just need to concentrate on the timing and capital preservation.

            Yes a simple framework of thought that has very quickly focused the way I invest Chickenpookie.

            Only really paying attention to this website and its investing thesis since the November rally I’ve now realised:

            * I’m underweight in precious metals. Having witnessed a 100% rise in SLW has really made me take notice.

            * My capital is overcommitted. This is partially the fault of my broker, who’s charging $17-25 for equities and $50 for ETF’s (welcome to Switzerland) – so I buy bigger tranches of a given stock – and my sister, who ‘dragged’ our family over to OZ and NZ (I booked those tickets when oil was $140) for a month of debauchery followed by her wedding. I’m rapidly rebuilding the minimum account requirements to transfer to Charles Schwab. This ‘overcommitment’ does concern me in that if this week’s rally doesn’t put what I’m holding into the green, I could be holding the bag on a bunch of stocks for a lot longer, leaving me unable to dive into further rallies.

            * This overcommitment is directly related to the stocks I’m selecting. I’m picking the dogs. DOW failed to rally (I appreciate why) and if it doesn’t pick up steam on Tuesday I’m gonna have to hold it. This doesn’t concern me so much in that it’s got a dividend distribution coming up and once I get over to Chuck I’ll start writing covered calls on to create income as I bide time. This is the best strategy I can come up with when stuck with stocks that aren’t going up.

            I averaged down on TBT and am starting to regret the commitment. TBT could double when the big move out of treasuries comes, but the time frame for such a move is uncertain. I need to get out of it quick or the longer term implications for holding a 2X inverse ETF could be damaging.

            * It’s clear now from Bill and fellow members that stop-loss orders have to be in place when I make these transactions. I’ve avoided this until now, not fully understanding the reasons to walk away at a small loss and fearful of the rapidly accumulating losses given broker commissions. But the world doesn’t make sense anymore. Stocks I once owned and loved (like AIB, a once seemingly solid Irish Bank) are being nationalised. Credit and debt issues have turned the likes of DOW into basket cases (I’m betting on successful resolution to their various issues). As someone says around here it’s hand to hand combat and I’ve gotta really focus to play.

            * I’ve gone short on stocks (is that the right expression?) as opposed to long, as I was taught at The Fool. Or is it time to let a portion of my portfolio go long? DOW at $15.50 is a pretty sweet price, hopefully not a value trap, given its value in any infrastructure plan Obama will conjure up. It seems to have found support at $15, as far as my uneducated eyes can tell. Or should one dump it next Tuesday, as soon as any sign of a rally peters out and remain cashed up as Nov. lows are eventually retested?

            At what percentage of the price paid for a stock are people here stop-lossing at? Is there a magic number?

            Happy MLK day tomorrow.

            LE.s

          • Johnny(118083 comments)-
            January 18, 2009 at 3:41 pm
          • tgifbipo(118083 comments)-
            January 18, 2009 at 4:17 pm

            Using the 80/20 rule, 80% of traders drop out. Of the remaining 20%, 80% will succeed, but perhaps not spectacularly. That’s good enough for me.

            Thanks for reminding me, i tend to get too aggressive at times, perhaps this could be my first tattoo, right on my forehead!!

          • David(118083 comments)-
            January 19, 2009 at 3:52 am

            Great post on trading, 2nd_ave! One of those that I want to keep as a reference and keep returning to.

  117. Grym(118083 comments)-
    January 17, 2009 at 3:34 pm
    • 2nd_ave(118083 comments)-
      January 17, 2009 at 3:47 pm

      “One comment which is unquestionable is that the Dow Jones Industrial Average is NOT reality.”

      Grym- That comment says it all. Reality is in the eye of the beholder. Prices are real when trading in real-time, but they are not ‘reality’ in the sense an average investor would define it. SLW hit 6.98 two weeks ago, dropped below 5 two days ago, and finished the week at 6.15. To an investor, it’s all noise. To a trader, it all counts.

  118. 2nd_ave(118083 comments)-
    January 17, 2009 at 3:40 pm

    http://tinyurl.com/9lvx56

    “That implies that world demand in 2008 dropped 0.3% and will drop 0.6% in 2009. The IEA noted the last time that world oil demand dropped for two straight years was in 1982 and 1983.”

    ” Oil futures have tumbled in recent months from highs of $147 a barrel to $35 a barrel for the February-dated contract.
    Eventually, the IEA predicts, a glut in supply will be absorbed as the Organization of Petroleum Exporting Countries cuts production and as governments like China and the U.S. build strategic supplies.
    “Demand will eventually rebound to absorb this oil currently struggling to find a market, but predicting the timing and extent of the rebound remains as elusive a target as ever,” the IEA said.”

    of course…

  119. Grym(118083 comments)-
    January 17, 2009 at 4:19 pm
  120. Bear E(118083 comments)-
    January 17, 2009 at 4:46 pm

    Bear with me… this is my first attempt at posting a chart.
    For those who think gold is going to new highs please consider the point where the 2 blue lines intersect on this monthly chart. The horizontial blue line is the “zero line” and the other blue line is the coresponding trend line.
    The green lines are the faster moving averages and the red lines are the slower moving averages. The thick olive green line is the middle bollinger band line. Also seeing a head and shoulders pattern forming with the right shoulder around 650.
    Bear E

  121. Ron Sen(118083 comments)-
    January 17, 2009 at 4:46 pm

    How can we restore trust? It’s not about laws or enforcement.

    The simple problem for the Bernankes and Paulsons of the world is how to obfuscate the distillate of what they want:

    The TRANSFER of TOXIC, TAINTED, LOW-VALUE assets from the HOLDERS (banks, brokers, conglomerates) to the American taxpayer. No more, no less. If, as a society, we accept this, then we are worthless sheep.

  122. Dr. Strangelove(118083 comments)-
    January 17, 2009 at 4:59 pm

    Bill –

    Instead of the occasional caustic threads that waste time and antagonize, a positive counter response would be a post-of-the-day or week or month. This would provide posters with an aspirational feedback loop. Even a star rating for posts can be helpful. Just a thought.

    This is a forward-thinking investment model you’ve got going here and I’m learning from it as well as your book. As a serious investor with a lot of family money at stake, I come here with a purpose. I would hate to be one to impede your progress and I have a dim view of those that do. You’re a bonifide maverick, maaan!

  123. shark_attack(118083 comments)-
    January 17, 2009 at 6:15 pm

    Hola Mi Amigo!

    Want to weigh in on SLW. Turns out we were both right. You were right, from a daytraders/swing traders perspective, right to take profits (particularly if you re-bought as the days low is exceeded. I was, I believe events will prove, also correct in my assertion that this issue is showing amazing strength. It’s got a daily up-gap a day ago, and is resting briefly on that springboard to profits (or trapdoor to infamy), the 20 day moving average. It also closed right at the high of the day.

    SLW is going up. So is Yamana. This is an historic buying oppty in these 2 issues. I like these 2 a lot more than any of the juniors mentioned recently, better than NXG, GSS etc.

    Have a lovely weekend.

    El Pez de Mar

    • 2nd_ave(118083 comments)-
      January 17, 2009 at 9:25 pm

      Hola El Tiburon!

      That would be Avenida Segundo, mi amigo…

      Well, basically, I hope SLW continues to spike up, along with silver, gold, and oil prices. That would pretty much do it for me.

  124. Johnny(118083 comments)-
    January 17, 2009 at 6:50 pm

    For those so inclined to be interested:
    This week in petrol http://tinyurl.com/a763x and
    the EIA short term energy outlokk http://tinyurl.com/dy16 with enough links to keep us busy all night.

    The message I get is that oil prices have no sustained upward lift until 2010 or there abouts.

  125. tobyt(118083 comments)-
    January 17, 2009 at 7:12 pm

    if I remember correctly if an option is more than .75 cents from the strike price it is automatically exercised, if within those parameters the owning individual has to initiate an exercise. The exercises are assigned thru electonic lottery to the brokerages, ie ibkr, mer, etc and then they do another internal electronic exercise to determine individual to be assigned. On the tbt i purchased monday the 41 call that i sold expired worthless fri so I will sell the feb/same price for 1.70 plus (hopefully) . cannot over emphasize DYOD…..

    • Quasi(118083 comments)-
      January 17, 2009 at 8:55 pm

      Not sure if they have now changed the exercise by exception, (auto exercise) rule #805, to a threshold value of $0.0075, but I know they changed it to $0.01 back in the summer of 2008.

      Here is a notice from the OCC, (Options Clearing Corporation) on the “Ex by Ex” rule and also covers how they set the closing price to determine whether options are in the money or not.

      http://www.optionsclearing.com/market/infomemos/20

  126. neophyte(118083 comments)-
    January 17, 2009 at 8:22 pm

    I own TCK and saw Mar09 50 calls for 19.70. Is this for real? I can sell calls for 10 x the amount of my cost basis and receive almost 2 grand in premium? Please someone with more experience slap me and show me the reality in this covered call dream of mine

    • Johnny(118083 comments)-
      January 17, 2009 at 8:28 pm

      neophyte, Feb & May options prices look normal so I would say the March 09 put/call pricess are simply posted in error.

    • Quasi(118083 comments)-
      January 17, 2009 at 9:13 pm

      Neophyte,

      You are correct, those options are for real and not a misprint. However be careful with options don’t assume they are what you think they are.

      First clue is the weird pricing, something is different here!! Second clue is TCK options start with the coding “TCK”, those options start with “FEG”. Now remember TCK bought Fording coal a while back, so the Fording coal options are now trading under the new owner TCK.

      So now we have to find out how those Fording coal options were adjusted to trade under TCK, I usually go straight to the source, the OCC “Options Clearing Corporation”. See the following contract adjustment memo from the OCC, its a little complicated but should help you figure out the pricing on those contracts.

      The contract deliverable is not the usual 100 share of TCK per contract, it is 24.5 shares of TCK plus $82.00 cash (less with holding tax). Note the same thing applies to the longer term leaps out in Jan 2010. It is much different than you think.

      http://www.optionsclearing.com/market/infomemos/20

      Whenever I see something very strange, there is usually a reason, just do a little digging, ie DD

      • Johnny(118083 comments)-
        January 17, 2009 at 10:07 pm

        Thank you Quasi, I thought it was just a simple error. I learned something.

        • neophyte(118083 comments)-
          January 17, 2009 at 10:30 pm

          Yeah, thanks Quasi. You big brothers are great to learn from. Now I’ll go back into the shadows lurking but learning.

      • Quasi(118083 comments)-
        January 17, 2009 at 10:48 pm
        • Johnny(118083 comments)-
          January 17, 2009 at 10:59 pm

          Thanks again Quasi. It’s near rocket science to me and I am cluless why the Feb & May options prices appeared to be priced normally for the time being.

          • Quasi(118083 comments)-
            January 17, 2009 at 11:17 pm

            Johnny, yes it is a little confusing due to the Teck buyout of Fording Coal and then the mixing of both the options under the option chains for TCK. But just look at the symbols, all the ones starting with TCK are just regular Teck options with normal deliverables. The options starting with FEG, (or YEG for the Jan 2010 leaps), have special deliverables, they are really quite different and thus are priced differently. To add to the confusion most option chain sites have the “in the money” highlighting all screwed up for these special options, their computer is just treating them as generic TCK options, they are NOT.

            Whenever you see something like that just go to the OCC website and do a search on the option symbol, usually the first 3 letters. That will usually get you to the adjustment memos where you can see what the actual deliverables are for that particular contract.

            I’ve been there done that, too. Its all part of the learning curve. If something looks too good to be true, it probably is, do some more DD until you understand whats really going on. And as I’ve heard Bill say if he doesn’t really understand it, he won’t trade it. Its also a rule that I try to follow.

          • Johnny(118083 comments)-
            January 17, 2009 at 11:24 pm
          • Johnny(118083 comments)-
            January 17, 2009 at 11:43 pm

            Can you recommend any books on options trading?

  127. Grym(118083 comments)-
    January 17, 2009 at 8:52 pm
    • Johnny(118083 comments)-
      January 17, 2009 at 10:04 pm

      Grym, I am convinced that the only way to get the attention of politicians is to become part of a larger group(s) and make your voice heard through them. We all know modern day politicians get elected by large campaign contributions from large banks, business, sovereign nations and powerful individuals. Slick well paid lobbyists are in their offices and their face every day. Individual voters are simply noise, citizens are a nebulous mass, appealed to at election time, then largely ignored. The news media feeds the voters pabulum. The masses (you and me) are too busy earning a living and taking care of day-to-day matters to have any time at all to dig into political matters at the federal level, let alone state, county and local politics. It’s all so overwhelming.

      I write letters occasionally myself and I usually get a nice form letter reply, except for Bush. Bush is the first president that I have written to twice and never received a reply.

  128. garryg(118083 comments)-
    January 17, 2009 at 10:02 pm

    I had sold the Jan 7.50 covered call. With SLW at 6.15 I was surprised this morning to find that I had been assigned. Is someone being good to me or do they know something that I don’t?

  129. davefairtex(118083 comments)-
    January 17, 2009 at 10:37 pm

    So here’s a hypothetical trade involving GE. I have read the arguments as to why it’s lame (specifically having to do with GE Capital) but – look at this 1-year trade.

    Buy shares of GE at 14
    Write Jan 2010 puts @ 10 for $1.83
    Write Jan 2010 calls @ 17.50 netting $1.59
    Hopefully receive $1.25 in dividends

    So if the price of GE
    * drops to 7: 12% income, 50% cap loss (if you choose to take it)
    * drops to 10: 33% income, 29% cap loss (if you choose to take it)
    * stays the same: 33% income
    * goes up to >= 17.5: 33% income, 25% cap gain

    Your capital gains are capped at 25%.
    GE below 7 is – an unpleasant prospect.

    You can increase your take right now by writing 1-month puts (0.32 for the Feb 09 10s) but I’m going to guess the volatility won’t stay that high for a year, which is why I’m looking at the LEAPs.

    Mish on his blog suggests S&P of 600 as his downside target price – which is a 30% drop from here. I’d say GE is a good proxy for the S&P. Seems like 10 as a downside isn’t all that horrible. And if instead of tanking down to 600 things stay the same, you collect a 33% ROI for your trouble. If you do this with $250k, you’ll end up with $82k in income.

    To decrease risk, I think I would wait for GE’s earnings this quarter before making the trade, because I’m guessing things will tank further if the dividend is cut.

    But seriously, this is just an example of how much we’re being paid to take risk right now. 33% income buys a lot of downside protection.

  130. SiO2(118083 comments)-
    January 17, 2009 at 10:52 pm

    Buyers of Horizon ETFs may wish to take note that some funds have gone through selective, mostly reverse, splits. This is making it a nightmare to compute their true performance.

    HOU 1:5
    HOD 2:1
    HGD 1:5
    HMU 1:4
    HJU 1:5
    HAU 1:4

  131. SiO2(118083 comments)-
    January 17, 2009 at 10:52 pm

    More active ETFs: http://www.invescopowershares.com/active/

    Hummm, is this the mutual fund industry reinventing itself and attempting to come back from the dead? At least the MERs are below 1% on these.

  132. boughtmypoints(118083 comments)-
    January 17, 2009 at 11:01 pm

    … after a 5 month absence, during which the rest of the world joined the credit squeeze that had first appeared in South Africa in May 2007.

    I am hearing of more arrivals by the returning South African diaspora than of departures (quaintly referred to as “packing for Perth”).

    The South African government in its genius already has a financial stimulus program up and running which will provide for profits to the least deserving. Oh, it’s called the FIFA 2010 stadium building program.

    The property market continues in general to be a wasteland. Commercial real estate is poised for collapse after an explosion of mall building in secondary and tertiary markets. The motor industry has collapsed, except for used car sales that have skyrocketed. 3 years ago at the peak of credit bubble, no self respecting South African would settle for less than a double cab “bakkie” or SUV. As a foreigner, I bought an out of favour used late model single cab for a good price. I was shocked to see current blue book value has not gone down a penny from what I paid.

    The price of fuel has come down even nominally in terms of Rand but remains historically high. The workers are miserable, seeing diminishing living standards. The whites are adjusting, some misery to be sure but resilience coming forth. The tourism industry has collapsed and there is nothing going on right now to provide visitor infrastructure for FIFA 2010 other than inadequate airport expansion and stadia that may not be finished in time.

  133. davefairtex(118083 comments)-
    January 17, 2009 at 11:20 pm

    Here are two year-long GG trades, same idea.

    Trade #1:
    2010 20 Puts: $4.30
    2010 35 Calls: $4.80

    GG >= 35: 35% income + 34% cap gain
    GG at 26: 35% income
    GG at 17: break even

    Trade #2
    2010 25 Puts: 6.80
    2010 25 Calls: 8.20

    GG at 11: break even
    GG at >= 26: 56% income

    You can go to sleep for all of 2009 and you’re paid 56% if nothing changes. Only if GG drops below 11 will you lose.

    • Johnny(118083 comments)-
      January 17, 2009 at 11:31 pm

      Dave, where do I signup for the course! Any books on option trading you can recommend?

      • davefairtex(118083 comments)-
        January 18, 2009 at 5:49 am

        Johnny – no, I don’t have a book recommendation! I am sure some of the better-read folks here do though. As for the course, well that’s just what I learned here on this site! This is kind of just a compressed version of Bill’s strategy.

        Buy a stock, sell puts, and then sell calls when you think it’s reached a local peak. I just sort of did it all at once, since the call premiums are high enough. I gave up a chance at capital gains in exchange for a fat call premium.

        Of course there’s no free lunch. You are taking more risk. If there is another massive drop in stock price, the maximum theoretical loss you will take (in the event of BK) is double your initial investment in the stock, minus the premium you collect. Of course you don’t have to stay in the position that long, but that’s the theoretical risk.

        This was just a sort of thought experiment showing the return you should expect from proper execution of the strategy you learn here. I got the idea when Bill said in his Saturday review that you can collect 10% from writing calls on big cap stocks one month forward. I figured, if 1 month is good, how much better would 1 year be? 🙂

        • Johnny(118083 comments)-
          January 18, 2009 at 1:26 pm

          Thank you Dave. I have traded a few put/call options on Scottrade but never written any, so I have that to look forward to once I have the confidence. I’m convinced of the strategy, but still in a learning mode.

  134. Johnny(118083 comments)-
    January 17, 2009 at 11:47 pm

    Bill got me hooked on looking here at the beginning of each week. http://tinyurl.com/8qbnhj

  135. Johnny(118083 comments)-
    January 18, 2009 at 12:00 am

    http://tinyurl.com/9l28q6
    “Most of the banks that received the money are far smaller than behemoths like Citigroup or Bank of America. A review of investor presentations and conference calls by executives of some two dozen banks around the country found that few cited lending as a priority. An overwhelming majority saw the bailout program as a no-strings-attached windfall that could be used to pay down debt, acquire other businesses or invest for the future.”

    Our politicians got us into this mess and help by taking us deeper!

  136. Johnny(118083 comments)-
    January 18, 2009 at 12:07 am

    NY Times – U.S. Subsidiaries in Offshore Tax Havens
    http://tinyurl.com/79hx25
    “Many of the largest United States corporations, including big banks now receiving federal bailout money, operate scores of subsidiaries in offshore tax havens that may let them evade or defer their tax bills, according to a government study released Friday.”

    …and nobody knew before today….right!

  137. Chickenpookie(118083 comments)-
    January 18, 2009 at 1:54 am

    Ion Geophysical popped up on the RSI last Friday, a play on offshore drilling…

  138. NYUGrad(118083 comments)-
    January 18, 2009 at 4:03 am

    http://tinyurl.com/7n858l

    if this is not a suicide, add another to the fugitive “advisor” list.

    it’s starting to become a trend.

  139. NYUGrad(118083 comments)-
    January 18, 2009 at 6:08 am

    …on the run. I searched this site and saw no results for his name, so i am assuming this is the 1st time anyone mentioned it here.

    http://tinyurl.com/9fy6ho
    MIAMI (Reuters) — The former head of UBS AG’s wealth management business, Raoul Weil, was formally declared a fugitive Tuesday after failing to surrender to U.S. authorities on charges of conspiring to help wealthy Americans hide assets from U.S. tax authorities.

    • Johnny(118083 comments)-
      January 18, 2009 at 1:39 pm

      NYU, when we read that Kramer and the other tout’s are being reigned-in, read about numerous indictments for market manipulation, insider trading and other shady wall street specialties, then we will know the SEC and FED have decided not to keep looking the other way and perhaps even put in a full days effort. They have a long way to go, given their cozy track record with Indymac, the Bernie Madoff types and many, many others.

      • Chickenpookie(118083 comments)-
        January 18, 2009 at 2:23 pm

        “They have a long way to go, given their cozy track record with Indymac, the Bernie Madoff types and many, many others.”

        That’s right, and let’s not forget that out of control corruption, greed and fraud are what created this mess in the first place while governmental regulators were supposedly unaware. The witch hunt is just another scene in the dog and pony show, once this particular scene is complete, reversion to mean always follows when regulators, lawmakers and corporations return to their old tricks. They got their hands caught in the cookie jar and so now have to put on a song and dance in order to wriggle themselves from harms way. I call it the good ol’ boys club, you can be sure they’re doing one hell of a lot of back scratching and looking over their shoulders behind the curtain while offering up selected sacrificial lambs.

        Nothing will “CHANGE” on the long-term horizon, we can “invest” in that.

  140. FranSix(118083 comments)-
    January 18, 2009 at 11:33 am
    • QT(118083 comments)-
      January 19, 2009 at 1:20 am

      FranSix

      Amazing set of pictures……..

  141. Johnny(118083 comments)-
    January 18, 2009 at 2:30 pm

    http://tinyurl.com/5vpus9 favorable mention of slvr, lot’s of charts and comment

  142. greg(118083 comments)-
    January 18, 2009 at 2:32 pm

    Since BAC took the 20B from the TARP on Friday, does that mean that the common shareholders were diluted by the preferred shares that the treasury recieved for the 20B loan? Is that why the stock dropped and what is a good stock price for entry into this company? I was reading on Pimco’s site that Bill Gross thinks that all of the banks will be nationalized at some point in time. Maybe that is a good thing from the standpoint that the government would hold the US homeowners mortgage loans. The government could have a monthly payment moritorium in depression times so people could stay in their homes with deferred mortgage payments until times get better. It makes sense. The foreclosures would stop.

    • Johnny(118083 comments)-
      January 18, 2009 at 2:54 pm

      Greg,
      1st – I’m no expert, but…
      Holders of preferred shares are ahead of common share holders in the long line of BAC creditors. So an increase in preferred share holders means there are more shares in line ahead of common share holders incase of bad news e.g. default, bankruptsy, company breakup etc. So this is not good news for common share holders and others back down the line. I suppose there may even be a formula for determining the adverse impact.

      The 20B in TARP funds makes BAC look more likely to survive for awhile, while underlining their dire condition.

      • Chickenpookie(118083 comments)-
        January 18, 2009 at 3:20 pm

        So the market cap was chopped in half… ~$30B and they received ~$20B in trade. Looks like BAC is hunkering down for some lean and mean times, fleeing from shareholders to govn’t monies – no surprise there, huh? Elimination of the dividend places BAC shares off-limits for any portfolio geared toward fixed-income, distilling BAC into a pure speculative play IMO, herding the masses back toward the Treasury corral. BAC shares are safer now probably, and their TA improved Friday, so there’s likely an short-term undershoot recovery coming. I expect long term they’re stuck in the mud until loan repayment.

        So what’s coming to the corporate bond market, how will the FED eliminate the competition?

    • Johnny(118083 comments)-
      January 18, 2009 at 3:19 pm

      1/16/09 BAC article http://tinyurl.com/7a9gjb
      “BAC will sell an additional $20 billion of preferred stock to the U.S. Treasury, at a fixed coupon of 8%. Also BAC and the Treasury will enter into a loss sharing agreement on a pool of troubled U.S. based assets, the majority of which are legacy MER holdings with the remainder being similar holdings from legacy BAC. Under this loss-sharing arrangement, BAC will absorb the first $10 billion of losses, with any losses above this level to be absorbed 90% by Treasury and 10% by BAC.”

      Additional interest payments reduces the money available to pay dividends to common share holders – IMHO

      Notice we taxpayers and our progeny are on the hook for 90% or so “legacy MER holdings” (read as toxic, near worthless derivatives). How nice of Mr. paulson and our esteemed legislators. It’s sure nice to be a citizen of the good ol’ USSA. Just feel the love.

  143. Craig(118083 comments)-
    January 18, 2009 at 3:16 pm

    BAC cut the common div to 1 penny, did the preferred div get cut?

    If not then exchanging common stock for preferred might be a good idea….if it comes to you.

    • yvrapx(118083 comments)-
      January 18, 2009 at 4:47 pm

      No, there is no impetus to delare any commom div, however, if common is paid one Prefs are in line first to get theirs. Would imagine the Prefs are non-redeemable and cumulative.

  144. Craig(118083 comments)-
    January 18, 2009 at 3:16 pm

    BAC cut the common div to 1 penny, did the preferred div get cut?

    If not then exchanging common stock for preferred might be a good idea….if it comes to you.

  145. Craig(118083 comments)-
    January 18, 2009 at 4:16 pm

    Used my usual favorites link to the Cara Community, like I have since 2004, and it didn’t recognize me so I had to sign in. Ah…all is well, I see 2nd is up….. Jumped to Ron Sen’s excellent and *scary* weekend missive, jumped back to Cara Community and the site doesn’t recognize me again and I have to sign in again. Hmmm? I don’t know if anyone else is experiencing this or of it’s my ISP. Maybe just a glitch.

    • 2nd_ave(118083 comments)-
      January 18, 2009 at 5:35 pm

      craig- the market’s been goofy, no doubt about that…how is the port doing…my trading half vastly outperformed the better half (buy-and-hope, LOL) this week…at one point i was 21% in SLW, now back to 7% + March calls…scaling into crude oil, and getting ready to jump on board any rally with OEX calls…buying calls/selling puts on the breakout in PALM on Thursday would have been the play of the week (and i think Vad’s group played it)…

    • korvus(118083 comments)-
      January 18, 2009 at 6:12 pm

      Craig,

      Have you tried clicking the “Remember Me” box when you log in? The reason I ask is because I was having problems with some users getting logged out eventually (logins were set to expire in something like a month), and it was causing some odd behavior. So a week or two ago I set logins to expire whenever you closed your browser UNLESS you clicked on “Remember Me”…in which case it would keep you logged in pretty much forever on that computer. I think you still have to log in to access your user page, but that’s to prevent a stored logon from being used to change your password.

      If you have tried the “Remember Me” option, let me know and I’ll look into it.

      Jeff

  146. Grym(118083 comments)-
    January 18, 2009 at 4:27 pm
  147. Grym(118083 comments)-
    January 18, 2009 at 4:37 pm
    • yvrapx(118083 comments)-
      January 18, 2009 at 5:03 pm

      Grym I have both, Mac PowerBook and PC. Ran Safari when it first came out because it was infinitely better than IE. Once Firefox arrived both Mac and PC went to Firefox. Here is the prob, the new version of FF is brutally slow so I began using Chrome for the PC and love it. Will definitely use Chrome for the Mac when it is released. Chrome is the way to go IMHO

  148. Quasi(118083 comments)-
    January 18, 2009 at 4:58 pm

    Reminder for options traders, the OCC issued a new memo this week explaining the new option adjustment rules for dividends and distributions. The old 10% rule for special distributions is being modified, some new interpretations as to what is special or extraordinary and the introduction of a new threshold limit for adjustments of $12.50 per contract.

    http://www.theocc.com/market/infomemos/2009/jan/25

    Just thought some might be interested, also per the discussion earlier on this thread here is an excellent tutorial from OCC on the subject of option contract adjustments. Most sections are pretty straight forward for stock splits and distributions, but have a look at what can happen under mergers and acquisitions, in particular two tier mergers can get very complicated. Also check out their other online tutorials.

    http://www.optionseducation.org/classes/syllabus_c

    • Johnny(118083 comments)-
      January 18, 2009 at 5:09 pm

      Quasi, Thank you for the post.

  149. score22(118083 comments)-
    January 18, 2009 at 5:07 pm

    http://watch.bnn.ca/#clip124283

    RICHARD Croft outlined two similar short straddles on Dec 24…..

    interesting video…….

  150. 2nd_ave(118083 comments)-
    January 18, 2009 at 5:16 pm

    http://tinyurl.com/777w5e

    sometimes i wonder how i would deal with living in, let’s say, the home my grandfather built, but adjacent to a neighbor (maybe two or three) i just can’t get along with…i could ask them over for dinner, and look for common interests…send the kids to the same school(s), have them try out for the same teams, or maybe just back away from passing down the same hostilities…if the adults are able to keep to themselves, but the kids insist on confrontations, i could build a wall around my home to minimize the disruptions…if even the adults can’t avoid confrontation, and/or the kids start getting physical, well hey, i would move away..

    then again, if i were old enough to have watched my grandfather (rightfully, in his and my opinion) reclaim the land upon which the home was built, and to have experienced and retained a strong emotional reaction to it, then moving away might not be an option…likewise, the neighbors would undoubtedly have similarly strong emotional attachments to their point(s) of view…we could surely live peacefully enough alongside each other for extended periods of time, but nothing ever stays the same- at some point in time, under the influence of pride, personality, emotional responses to unrelated issues, any of several substances, maybe just adolescent hormones/boredom, the conflict would reassert itself…

    so in a way, resolving the conflict is beyond human capability…but here we have two cultures with strong religious influences, and both religions believe in the existence of/need for a higher power…vengeance may be wired into the human psyche, but so is forgiveness; unfortunately, vengeance is the easier path, and forgiveness is a hard and lonely road…but that’s what higher powers are for, to enlighten us to the ultimate value of walking the other path…

    • swissrobinson(118083 comments)-
      January 18, 2009 at 8:57 pm

      >so in a way, resolving the conflict is beyond human capability…but here we have two cultures with strong religious influences, and both religions believe in the existence of/need for a higher power…

      Not my preferred subject for public discussion 2nd, but the history of this region is fascinating.

      Allow me to throw off a few titles touching on Israel/Palestine for those interested in further reading.

      Karen Armstrong is a former nun come atheist (does believe in a higher order, but not the christian doctrine or idea of god, something I subscribe to). Focus on religious fundamentalism (Christian, Islamic and Jewish) in ‘The Battle for God’. She documents the religious response to the creation of Israel, or Zionism, which was a uniquely secular process. Very strong religious backlash to the creation of the State of Israel, which was seen as disobeying a direct command of god (a command that they should remain homeless or wander the earth as punishment for a reason I cannot recall). This secular/religious divide or power relationship has certainly changed in the last 50 years but I’ve read little on the modern state of affairs in Israel.

      What little I have read on the modern region comes from Robert Fisk, redoubtable reporter for the UK Independent (he’s the man to follow if you want to know the Middle East). His ‘Great War for Civilisation’ is largely a recount of his last 25 years coverage of the Middle East from his home in Lebanon. If you want to know what really happened the day the US Navy shot down the Iranian passenger aircraft, read this book. Want to know of US relations with Saddam Hussein (including the details of that charming photo of Saddam and Rumsfeld shaking hands) read this book. We’re reminded that Palestine was a British mandate at one stage, who considered segments of the Jewish population flocking to the area following world war 1 ‘terrorists’ (this much overused and maligned word should be removed from our lexicon). That they were flocking to Palestine was because the British double-dealed both the Jewish and Arab communities in promising their freedom and the land; one of the primary reasons the region is in this mess.

      Another book I’m reading (all half-read but never completed) is by an interesting American (you can take this description any way you want to 🙂 called Jared Diamond, who has written a documentary called ‘Collapse’. He’s gone and researched the collapse of many civilisations – the Vikings in Greenland, the Polynesians on Easter Island, the Indian tribe whose city remnants can be found in the South West of the US (Anastazi, I think they’re called). Anyway, environmental collapse, combined with other key factors that are analysed are surveyed both historically and in modern times (he looks at a degraded farming valley in Montana, surveys Australia’s environmental issues, points out Somalia’s environmental collapse as a reason for its present problems) and I suspect that the regions of Israel/Palestine would likely meet Diamond’s criteria of encroaching collapse. River’s are drying up, the Sea of Galilee is rapidly disappearing and the fragile soils are degraded. These issues, I suspect, are playing out in conjuction with the issue of small myopic groups holding power through aggression against Israel.

      Full disclosure – I am a STUDENT, not an expert!

      Apologies if any details here are deemed to be erroneous. Productive discussion is welcomed, but having heard Bill Moyers’ getting lambasted on his PBS podcast after covering the issue, I understand that emotions run high. No offence was intended. Please don’t think me a preacher. I simply wish to point out some interesting reading that may shed further light on elements of a story not commonly told in mainstream media.

      My education in politics is the primary reason I’m here at Bill’s site. I’m of the opinion that we’re soon going to be stuffed, both environmentally, politically and subsequently (or already??) economically. The government in Switzerland is already scaling back promises to the retiring demographic and those looking to retire in the future. This erosion of standard of living is likely to accelerate in the coming decades. So I’m looking out for my family as best as I can.

      Night all.

      Le.s

      • 2nd_ave(118083 comments)-
        January 19, 2009 at 3:14 am

        “..the history of this region is fascinating.

        Allow me to throw off a few titles touching on Israel/Palestine for those interested in further reading.”

        swissrobinson- i know next to nothing about the region, and was thinking about a trip to the library earlier today…appreciate the references…

  151. TradingMyChips(118083 comments)-
    January 18, 2009 at 5:30 pm

    A good trader has a reason for entering a
    trade. A great trader waits until the signal triggers and then acts on that signal(Quote from John Person).

    Scaled into AGU.TO @ 40.00 (Tuesday )and 41.64 (Friday).Will try to post signal triggers later.

    Thanks gents …for all the great posts

    TMC

  152. Craig(118083 comments)-
    January 18, 2009 at 7:58 pm

    Korvus: Thank You, I think you may have explained it, outside of it not recognzing me the second time. I used the Remember Me option the second time and here I am! So far so good.

    2nd: The port is doing better than last year although still down. I’ve been working my way back and my set-up so far has been catching the turns and trends pretty well. Nobody wins them all but I am ruthless these days if a trade turns against me even a little bit and I ride the winners as long as I can and sometimes trade around them depending on volatility. I have been more patient to let trades come to me. I did pretty good on SLW/GSS/SLV/TCK/CAT/SNDK/MSFT and iced my profits while preferreds like Cenex gained lately on a down tape while paying a nice div, so no complaints by me so far. I suspect the market may come to us a couple more times, which means more opportunities.

  153. score22(118083 comments)-
    January 18, 2009 at 8:26 pm

    macd, rsi, & ma’s work sometimes but not all the time. when i guess on direction, i theortically have a 50% chance to be wrong. but in practice results are greater than 50% wrong. macd, rsi, & ma’s show what has already happened. they may have just a 50% chance to predict what comes next.

    • Bill Cara(118083 comments)-
      January 18, 2009 at 9:37 pm

      Re: “…in practice results are greater than 50% wrong,” I strongly disagree. You have given no time frame, and you have shown no understanding of the nuances of technical indicators to make your statement, other than of course, they don’t work for you. It sounds like you believe in the so-called randomness of prices. I think there are next to no professional traders who accept that academic nonsense. But, having said that, maybe you have discovered a better way to trade. We are all ears. That’s why I blog. I’m here to learn.

      • NYUGrad(118083 comments)-
        January 19, 2009 at 2:03 am

        Not sure if score22 was bashing indicators. my read of his post was, even with indicators the price may move against the trader. more of a cautionary tale i guess.

        I am still learning but the indicators worked almost to perfection the past two weeks for me. I have the gains and extra shares-earned to prove it.
        http://tinyurl.com/8scw8g

        Just hope the quality of my logic is increasing as i continue to learn from the group here. one thing i am learning from comparing my results of the past 2 weeks on actively trading SLW vs Aug 07-Mar 08 rally (which i did not participate), is that stochastic alone is not suffice. Dont get me wrong, the past two weeks i did use other metrics such as how gold was acting, support levels being defended on slw, volume, overall indices etc. but stoch was my “open the door to feel if it was cold or see if it was raining” indicator on my initial read.

        One thing is for SURE, indicators are better than listening to an average financial “Advisor” or the “news” 🙂

        • Bill Cara(118083 comments)-
          January 19, 2009 at 2:44 am

          Either you believe that prices (i) are random, or (ii) are based strictly on fundamentals, quantitative or economic factors, or you believe (iii) have trends and cycles that exist in the price series data that can be analyzed by simple mathematics we refer to as algorithms or technical indicators.
          http://en.wikipedia.org/wiki/Algorithm

          I dispute the first; disagree with the second (although I believe that all are factors); and I wholeheartedly endorse the latter. However, I acknowledge that trading involves as much or more art (ie, subjective interpretation) as science (ie, mathematics).

          • NYUGrad(118083 comments)-
            January 19, 2009 at 3:07 am

            I now subscribe to (iii).

            I remember an actual class at Stern Finance at NYU when a professor tried to teach us (i), and money cannot be made in stocks short term on any reliability. And i recall thinking to myself “why the hell am i here?”

          • nemo(118083 comments)-
            January 19, 2009 at 5:37 am

            Had to put my .02 in on SLW and the claim the fellow missed the technicals on SLW. I’ll start in Jan for S&Gs. I think that’s where the gentleman lost the rise in the $10 handle on SLW. Starting on about 5 March 2007 to 17 March there was a fall in the price from approx 9.50- approx 9. Higher lows in RSI-9 and Stochastics occuring on approx 17 March which were divergent from the fall of the stock, and presaged, as such divergences often do, an increase in price. Within approximately 3 days a positive stochastic cross occurred, which also signaled the bottoming of the A/D indicator. There were now 4 indicators turned positive. Volume was also increasing on price increases and decreasing on price falls. Also bullish. SLW than made an interim peak on 23 July. At that point RSI-9 had a double top and subsequent lower high dropping through the 80 level for a sell signal, as had Stochastics and the MAC was downsloping towards a negative crossover. Yep. Interim sell.

            You will then notice between, oh, 18 August (nice candle hammer) and Labor day a churning range in the stock price. Yet, also during that time you had bullish ascending lows in RSI-9 an Stochastics again as well as a MACD rise. Also, the A/D line had leveled. So, including the hammer, you had 3 technical indicators that had gone positive, 1 that looked to be turning positive, and one neutral-a buy, and could have basically ridden that run to 14 comfortably.

            There, the indicators got a bit squeemish around the last week of September 2007, which if I remember correctly, was when Bill said to head for the hills. Depending on your trading expertise, calls and puts could have been exercised, or more short-term trading could have been profitable, but as Bill said, it’s been basically a day trading market since.

      • swissrobinson(118083 comments)-
        January 19, 2009 at 7:58 am

        >Re: “…in practice results are greater than 50% wrong,” I strongly disagree. You have given no time frame, and you have shown no understanding of the nuances of technical indicators to make your statement, other than of course, they don’t work for you.

        Having said this, and with the understanding that most of us will never invest as much time as a professional like Bill, are there any websites out there with a good introductory overview of technical indicators? This RSI indicator I’m picking up here is neat, I’ve learned to read the moving averages chart, what is another useful tool for the newbie to learn to appreciate?

        Do you cover technical indicators in your book Bill?

        Les.

  154. Chickenpookie(118083 comments)-
    January 18, 2009 at 8:28 pm

    ” CHENEY’S ONE REGRET: I SHOULD HAVE TRIED CANNIBALISM

    ‘I would have to choose more conservatively, and maybe look for someone with a little less gristle, perhaps Sarah Palin.'”

    http://www.legitgov.org/shulman_cheney_regret_1701

    • swissrobinson(118083 comments)-
      January 18, 2009 at 9:06 pm

      ” CHENEY’S ONE REGRET: I SHOULD HAVE TRIED CANNIBALISM”

      I dunno Chickenpookie, are you agreeing to the sentiments uttered by the Vice-President?

      That’d put you within a toehold of getting barred.

      I for one am offended by Cannibalism 🙂

      Somehow, I just don’t think the next administration is going to provide as many possibilities for lampooning as the present. I’ve enjoyed McClatchy’s political cartoons for years. Pity, but all good things must come to an end…

      LE.s

      • Chickenpookie(118083 comments)-
        January 19, 2009 at 12:45 am

        swissr – Both are “ralf on your shoes” offensive IMO. I’ve pointed out many times here how beltway insiders believe in themselves even to the last detrimental moment and expense of the country, this time even to the world… They cannot grasp the concept of having done harm in their quest to service their own interests, it isn’t within their means.

  155. Johnny(118083 comments)-
    January 18, 2009 at 9:46 pm

    http://vimeo.com/1778399 or sort of like a day in this market.

  156. Bill Cara(118083 comments)-
    January 19, 2009 at 2:31 am

    Today in the WIR, I commented that crude oil could not stay at the 40 level (or lower) for long because the costs worldwide of extracting and delivering that oil have skyrocketed in recent years. I checked with a blog from a week ago by CP who was quoting data from a couple sources (unchecked) that shows costs as follows:

    oil and countries new
    Submitted by EDC on Mon, 12/15/2008 – 15:53. #3041
    From Gartman/Mauldin
    Cost-year-’00-’07-’08-’09
    Venezuela-$34-$91-$94-$97
    Nigeria—$32-$63-$68-$71
    Iran——$18-$49-$55-$58
    Saudi-Arb-$23-$49-$55-$62
    Kuwait—-$11-$45-$45-$51
    UAE——-$05-$34-$42-$51
    Algeria—$22-$26-$31-$35

    Could someone in the know (or otherwise) please check this data? I think it’s quite important, and could likely hold the answer to where oil prices are headed.

    I remind you that oil is not like gold. Not much of the current production can be stored, unlike gold where almost all the gold produced in world history is still in inventory somewhere today.

    • 2nd_ave(118083 comments)-
      January 19, 2009 at 3:34 am

      A simple Google search led to the following, which quotes break even prices provided by the Bank of Kuwait. The link is dated 1/5/08, so the numbers are a year old. However, the numbers are so far off from the ’08 figures posted earlier I thought they would be worth posting.

      http://tinyurl.com/88odb8

      “$100 per barrel: the line was finally crossed on January 2nd 2008. What does this imply for profits of oil producing nations? In order to run some numbers we have to consider a key measure called the break-even price which is the amount of money it takes to extract 1 barrel of oil.

      “The break-even price is the first thing oil companies establish in order to determine if drilling a new well makes financial sense. From the break even price, profitability can easily be determined with the following formula:
      Profitability =
      (Price of Oil – Break Even Price) / Break Even Price

      “For example with oil at $100 and a break even price of $50, profitability is 100%. But with oil at $60 and the same break even price, profitability drops to 20%
      By dialing their target profitability first, oil companies then determine if a new drilling project is feasible. Needless to say, with oil retailing now at $100, more wells will be drilled in deeper, harder to reach places than were previously profitable.

      “The following table provided by the Bank of Kuwait gathers current reported break-even prices of major oil producing nations:
      Oil Break-Even Prices
      Nation US$/Barrel
      Bahrain 40
      Kuwait 17
      Saudi Arabia 30
      U.A.E. 25
      Oman 40
      Qatar 30
      Canada’s oil sands 33

      “Based on the formula, profitability of these countries’ oil operations are in order:
      Profitability at $100/barrel oil
      Nation Break-Even Price Profitability
      Kuwait 17 488%
      U.A.E. 25 300%
      Saudi Arabia 30 233%
      Qatar 30 233%
      Canada’s oil sands 33 203%
      Bahrain 40 150%
      Oman 40 150%

      “This level of profitability explains the recent $7.5 billion placement in troubled Citibank from the Abu Dhabi Investment Authority, the $1.8 billion investment in UBS by a strategic Middle East investor and the 20 percent acquisition of the London Stock Exchange by the tiny nation of Qatar.
      High oil prices have allowed Gulf Cooperation Council (GCC) countries to boost their foreign assets to more than one trillion dollars during the 2002-2006 period. With a looming recession (read “western assets on sale”) and high oil prices we can expect this trend to increase.”

      • David(118083 comments)-
        January 19, 2009 at 4:17 am

        2nd_ave, the Bank of Kuwait cites the break even price of Canada’s oil sands to be $33. I spent a little time reading about this subject, and what I found on the web (mostly from Wikipedia) was that the initial estimates of the cost of oil extraction from Canadian oil sands were greatly optimistic. Once such projects got underway, all sorts of difficulties arose. One of which, as I remember, was the fact that there was not enough water to keep washing the oil from these sands at the sufficient rate. Another one was the labor costs pretty much doubling every year, as the working environment in oil sands is horrendous. Since the Bank of Kuwait quoted such an optimistic (and unrealistically low) quote for the Canadian oil sands, could their other quotes be too optimistic as well?

        • jack black(118083 comments)-
          January 19, 2009 at 4:32 am

          I agree, the bank of Kuwait numbers seem like a gross underestimation, especially for Canada, but Bill’s numbers sound too high.

          But, there is a huge difference between the cost of running old fields (Saudi’s boast about $5/barrel in their best fields) and the new projects just coming online. Thus, one can quote radically different numbers and still be correct.

        • 2nd_ave(118083 comments)-
          January 19, 2009 at 4:45 am

          David- I was a little surprised at the oil sands break even price also. Can’t think of any particular reason for the Bank of Kuwait to publish ‘optimistic’ figures, but you never know. Also wonder if the numbers refer to a particular type of crude, or some composite; right now Brent is priced about $10/bbl higher than light sweet.

          • Mark Barry(118083 comments)-
            January 19, 2009 at 5:11 am

            Had lunch today with the ex chairman and ceo of one of the largest oil companies in the world. We talked about the oils sands in Canada and he pegged the recovery price @ $48.00/barrel. Also an interesting comment that the US is doing the same stupid thing and ignoring the opportunity to shift away from crude.
            He pegs oil to bounce back and forth between $40 & $50 and break through to end the year at $70.
            If this type of comment is not helpful to the community I will stop posting them.

          • swissrobinson(118083 comments)-
            January 19, 2009 at 8:20 am

            Thanks Mark, I’m a newbie here but excited by this discussion into oil futures. It sounds increasingly profitable.

          • seadog(118083 comments)-
            January 19, 2009 at 9:58 am

            Mark,
            Comments are eagerly accepted. It’s up to each of us to evaluate according to our beliefs as Van Tharp would say. Keep ’em coming. The 40/50 cycling sounds logical, makes sense but logic flies with the fairies past the Cuckoo’s Nest these days.

    • Dr. Strangelove(118083 comments)-
      January 19, 2009 at 4:45 am

      WSJ on Mon, 10/21/2008 with links to articles quoting gov’t sources – if “budget” = break even point
      http://blogs.wsj.com/environmentalcapital/2008/10/21/

      Cost-year-’00-’07-’08-’09

      Venezuela-$34-$91-$94-$97 EDC’s source
      Venezuela———-$35-$60 WSJ

      Nigeria—$32-$63-$68-$71 EDC
      Nigeria————$62-$45 WSJ

      Iran——$18-$49-$55-$58 EDC
      Iran——————-$55 to $60 (09 only) WSJ

      Angola—————–$65 WSJ
      Russia————-$70-$95 WSJ
      Iraq——————-$80 WSJ
      $60 (Iraq gov’t Plan B)
      $111 (IMF’s est for Iraq)

      Saudi-Arb-$23-$49-$55-$62 EDC
      Kuwait—-$11-$45-$45-$51 EDC
      UAE——-$05-$34-$42-$51 EDC
      Algeria—$22-$26-$31-$35 EDC

      Oil was trading around $75 when the WSJ article was published and below $50 a few months later when EDC’s data was published. Those are big changes in production costs coming from Chavez but he may have chased away big oil partners between that time. Nigeria also showing some big adjustments between published figures. Looks like IMF assumes it gets half of Iraq’s production costs in interest?! How can we trust any of these estimates considering the sources: OPEC, OPEC countries, Chavez, IMF …

  157. 2nd_ave(118083 comments)-
    January 19, 2009 at 2:59 am

    David/Vinod- Love, pride, and the illusions/(self-)delusions we engage in chasing either one…set in the Bangladeshi community of London’s East End…based on the novel…Salaam

  158. goatmtn(118083 comments)-
    January 19, 2009 at 4:16 am

    Attached file is from Justin Mamis’s “Nature of Risk”

    My take on it is that we are at the beginning of the “Discouragement” phase.

    cheers,

    doug

  159. NYUGrad(118083 comments)-
    January 19, 2009 at 5:03 am

    If i had more time to spare for leisure, i would start my own “America’s Most wanted Advisers” page.

    http://tinyurl.com/7hz68g
    “IDAHO FALLS – An article released Saturday by the Wall Street Journal says investigators have begun looking into a Ponzi scheme discovered in Idaho Falls. A Ponzi scheme is where money is raised from new investors to pay off earlier investors. The article says its costing investors as much as $100,000,000 dollars.

    According to the article in the Wall Street Journal, Daren Palmer, an Idaho Falls business man, is being investigated after the department of finance met with around 30 investors in the area, who say he’s taken their money.”

  160. seadog(118083 comments)-
    January 19, 2009 at 9:37 am
  161. Luggie(118083 comments)-
    January 19, 2009 at 11:42 am
  162. Grym(118083 comments)-
    January 19, 2009 at 4:21 pm

    I think this whole line of discussion is degrading to cannibals.

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