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Mark?s Market Commentary ? January 23, 2003


Every guy has had that psycho girlfriend which he has only known for a few months. She?s been over to your house, but never alone. Now you have to go out of town, and her condo is being fumigated and she needs a place to stay.


Do you let her stay at your place while you are out of town?


That?s an extremely risky proposition.


Who knows what you will find when you get back. You could find that the house has been cleaned and all your laundry has been done. You could find it completely reorganized and redecorated.


On the other hand, you could find it ransacked. All drawers opened, all cupboards cleaned out looking for clues of ?another girl?. She could find that stray lingerie still in left in your dresser from that girl you dated last year. She could find cards sent from ex-lovers. She could find a half open box of tampons under the sink. She could find one too many toothbrushes.


And she could fly into a fit of hysteria and trash the place, leaving a ?Dear John? letter. And leave for Las Vegas with your spare wallet containing credit cards and your ATM card.


Leaving town with a bunch of short positions open on these Supermodels is a risky proposition. What will I find when I get back in town? QLGC at $48? Or QLGC at $30? Who knows?


What will KLAC say tonight? Beat by a penny? Topping views? Exceeding estimates? Higher sequential growth? Hopes for a bottom and a sustained recovery in the 2nd half?


Or will we see layoffs? Lowered guidance? Difficult industry conditions? Who knows?


In the meantime, the ?dividend stocks? continue to get smoked. Who bought EK, T, VZ, and SBC based on Kudlow and Cramer?s recommendations? They are down more than 15% in less than a month. So much for that tip.


By the way, we know Cramer is a trading junkie. Anybody subscribe to his ActionAlerts? How is his portfolio doing? And what about Kudlow? Does he even have any money left to invest after investing thousands in booze, womanizing, and rehab treatment?


And why couldn?t QuackComm get it going today? I thought they ?blew past? estimates. What happened to that $2.30 gap up on the open? Too many San Diego hopers are holding the stock at $100/share waiting with sell tickets. And insiders are selling like mad.


What happened to all those gold shorts? I noticed some giant positions in today?s WSJ Short Interest section. Too bad. They forgot that gold is in a bull market. And by the way, it looks like a lot of short interest has been worked off in the broad market. Lots of bears now betting on the 2nd half recovery bandwagon.


The VIX is continuing on its forced march up to higher highs. Yet the VXN is still having an MTV Spring Break party near the lows. Will the NYSE options traders join the party? Or will the crack head HeatMapper options players collapse?


Note the increased concentration of buying and selling. Everytime we get a big disappointment, the news is deemed to be ?company specific? and all selling volume is assigned to one stock. Yesterday it was EK. Today it was AT&T. Other stocks are unscathed. That?s why on a big down day we get 4.00 TRIN readings. Then we get the hysteria ?beat by a penny? news out of TXN and QCOM. Opening TRIN on a day like today is a .16, where all HeatMapping is confined to two stocks out of the 6,000 that trade on the exchange.


I expect that before this bear market is over, when all Arena Participants are on Level II RapidJet Trading with Instant Order Execution, then future bounces will have a TRIN reading of less than .10. Somebody like Broadcom will announce 15% sequential growth, and the next day, 160 million shares will be traded in BRCM, pushing the stock up $10 in less than 2 hours. Mid cap stocks on that day will be lucky to see more than 500,000 shares traded.


Also note the ongoing paranoia which seems to be building steam daily. The paranoia of not getting on the ground floor of the next DELL or MSFT. Or the next blown up stock to stage a Harley Davidson miracle recovery. Which stock will be next to move 7000% the next 10 years?




Maybe it will be DYN, CPN, or MIR?


Or maybe NT, LU, and GLW?


No wonder these are incessantly chased everytime there is a 12% daily move.


Note the disdain and disinterest in the gold stocks. Maybe Rod McEwen needs to change the name of Goldcorp to Gold.com. And he should cash in that gold bullion he holds in lieu of marketable securities and trade it for some more exotic high yield paper, like Primerica Penile Implant Receivables Trust Series VII, yielding 9.2%, AAA-rated thanks to MBIA, leveraged 140 to 1 in the 550th level in the Multilevel Marketing Pyramid. Default rate climbing to 12.6%, but who cares? The Chain Letter of guarantees and promises makes this instrument risk free.


Speaking of securitizations, I wonder how well those receivables are performing from last fall. Remember all those ads financing car stereos, 19? chrome wheels, stainless steel spoilers, and white out instrument panels and taillight kits? Zero down, no payments for 6 months, then 34% interest for the next 6 years?


Uh, oh, looks like those car stereo companies are hitting the skids. Trading halted.


California Amplifier warns of Q4 shortfall (CAMP) by Tomi Kilgore California Amplifier (CAMP) lowered its outlook for fiscal fourth quarter earnings and revenue, citing weaker than anticipated demand for its boom box amplifier products. The stock is currently halted for trading until approximately 2 p.m. ET, while news of the company's warning is disseminated. The last trade prior to the halt was at $5.05, which is down 50 cents, or 9 percent, from Wednesday's close. The company said it now expects to earn 3 to 7 cents a share on revenue of $22 million to $26 million during the quarter ending February, below the average anal cyst estimates compiled by Multex of 9 cents a share and $27.7 million, respectively


Also note the online trading activities of the HedgeHogs which are 100% news driven. KRB gets crushed on a warning, so Salomon, who needs to offload some stock, sends a starter pistol to the field to get the SubPrime Greyhounds moving. Result: A complete round trip on the stock on the intraday.


MBNA bounces amid midday upgrade (KRB) by Tomi Kilgore Shares of MBNA (KRB) are down $1.26, or 6.9 percent, at $17.04 after the credit card issuer reported fourth quarter earnings that fell short of expectations, but was down as much as $3.16, or 17 percent, earlier in the session. anal cyst Michael Vetto at Salomon Smith Barney helped the stock bounce by upgrading it to "outperform" from "in-line" due to the "over-reaction" to the company's earnings miss, which has created a "buying opportunity." He said the miss was driven by a change in the company's reserve coverage methodology, which led to a higher-than-expected loan loss provisioning rate. "As such, we do not believe the company will have a materially higher provisioning rate in 2003," Vetto said in a midday note to clients.


No shame here. Every miss is a ?buying opportunity?. Every blown up stock has a ?compelling valuation?. Every earnings target, arbitrarily moved around at will by the Chuck Hill, the Earnings Keno Pit Boss, is maneuvered to make sure that the next announcement is either ?in-line? or ?tops views? or ?beats by a penny?. I?m sure that this Michael Vetto over at Salomon will be receiving some Tony Soprano ? style hundred dollar bill bricks from the Specialist Pit this afternoon.


It appears that the Global Markets are starting to suffer. The FTSE is right at the October lows, down 7 sessions in a row. The DAX is not far behind. The Nikkei is getting a ramp job as usual, since the BOJ doesn?t even bother with Repo Feeds. They just climb in the pits and start buying. All hope lies here in the U.S. market, which is holding up the best. All hope rests in the hands of the U.S. Consumer, and the mere utterance of hopeful news out of Jim Morgan or Michael Dell next week.


Never before has the entire globe depended on the fantasy of a miracle comeback of the technology and Internet bubble, where U.S. consumers point, click, spend, and daytrade to properity with no real job.


Never before have we see such violent speed of paper promises layered upon more promises layered upon hedges and contracts chasing each other?s tails in the Circular Atomic Particle Accelerator. Each participant thinks his risk bag has been offloaded to the poor schmuck behind him. Each participant thinks his profit stream can outrun default losses. Each participant thinks they can point and click ahead of the rest of the pack, exiting his trades 15 minutes faster than everyone else in case he makes a mistake.


Everyone has their finger ready, poised over the Panic Button, thinking they can punch out of the Atomic Particle Accelerator without injury.


Note: I?m outta here to catch some waves down in Baja for the weekend. No commentary tomorrow. Good luck to all Riverboaters, and have a good weekend.



Position Summary:


New half short on AMGN at $53


We are 47% short, 32% long, 21% cash.


Half Short:


MBI at $50

KLAC at $41

CYMI at $39

NVLS at $35

INTC at $18

MSFT at $56

WHR at $56

INTU at $49

AMGN at $53


Quarter Short:


FRE at $68

LEN at $56

COCO at $40

NCEN at $28



Half Long:


GG at $11

HL at $4.55

BGO at $1.31

PAAS at $5

DROOY at $3.35

GLG at $9

GSS at $1.72

WHT at $1.05

KGC at $2.35

HMY at $16

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TE shamed me into joining yesterday -- he's a great shill for the sight.


Today, Bob Pisanti was telling masses how to invest in bullion via CEF (carefull - selling at premium to NAV). Also MWD (I think) was actually recommending 2 to 5% allocation to gold/shares.

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the usual American-style investor= buy high. After 2 years of trashing gold at 20 year lows, at 7 year highs they put out a "buy". Suspect a pullback soon due to all this, BUT this is Phase 2 of the gold bull, as public interest gradually gets recruited. Suspect several years of advance & decline (with a slow creep up) until it goes parabolic in Phase 3. I am very much more tilted towards silver at the moment, and am accumulating more physical (stopped gold accumulation late last year).


No other thoughts worth mentioning at the moment; immenent conflict is making the market rangebound.

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Welcome to the best damn site on the net, for people like us.


A shill?


I'm NO shill Sir. I believe in Doc MOST sincerely and try and get him subscribers but i ain't no shill.



Unless of course, you ment it in a good way. :grin:

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The klac call must be a hoot. First the stock ramps up to 37 and a laugh, now trading sub 36. ( assuming my quotes are accurate)bits

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well,we closed right on the 50 day,just like thought we would,I will buy puts if we have any spike tomorrow,bought a small block of drcvx on the close today.


the q's sold off right on the close,we will see what happens in the mornin

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I knew Dat.


I got ya to post again though. 497 more and you move up a level.


Good luck here and again,


Welcome fellow stoolie. :wink2:

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I am very much more tilted towards silver at the moment, and am accumulating more physical (stopped gold accumulation late last year).



I agree with you about accumulating physical silver. I usually buy 90% US quarters. I think silver is very cheap at these prices. The only problem with it is it is SO cheap that you get so much. It's heavy and hard to find places to stash it. :D

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Back from a refreshing overnight stay @ THE GREAT BEAR LODGE where I spent the evening reading " Jesse Livermore Worlds Greatest Stock Trader", a must read for all stoolies and should be required reading in high school lol. Didnt realize he was known on wall struck as The Great Bear, anyhow the parallels between "then" and now are uncanny. Many good points about trading and wall street cronyism, the fix was in then as well. The book confirmed to this stoolie that the bottom is no where in sight....closed spx puts and mxim on wed. for some major ducketts will be reloading soon..should see 900 on spx but no higher than 912 before we go over the cliff...Trade safe.... GFI lookin strong as well.

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Summoner, I'll have to read that book. Didn't he make alot of dough on the early decline but then lose it all by going dong way too early?


Back in the early eighties when I first got into this nutty market I first read books about the crash to make sure I really understood what I was getting myself into. Always look at the bad side of things as well as the good side before jumping in. So many did not and were major bamboozled by buying into the 90's buy-and-hold-forever drivel/mantra.

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Thanks Mark,


White is black and so on. Still think your DSL failure was great.


After the close we are reading ?Losing streak ends?.


What a joke. Good, now we can begin the rotting streak.

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Mark, at the peak of the gold bull I expect to see Maria interveiw the newest miner......Amazon gold. Bezos still won't be profitable of course. Hahaha :P

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