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Mark?s Market Commentary ? December 16, 2002

 

Today?s The Wall Street Journal is a must read.

 

Anyone who doesn?t have it must get it immediately and save it for the archives. The lead story in the back section is titled ?Aftermath of a Market Mania?. This is an excellent discussion of what has transpired since 1999, giving realistic accounts of what small time investors were thinking during and after the mania.

 

It also contains graphs of the Nasdaq and Dow, showing clearly the delayed destruction and unwinding of the mania.

 

If you were a financial historian in early 1999, and studied past manias, bubbles, and buying panics, it would have been impossible to imagine what would take place the next 4 years.

 

If you were a mystery writer, it would be impossible to make up a story as incredible as this one.

 

So many twists and turns.

 

So many people ruined.

 

So much time where hope was kept alive.

 

So much increasing speculation throughout.

 

So many impossible, gravity defying feats of accomplishment to keep the action propped up.

 

So much bewilderment, excitement, and despair.

 

Who would have believed that such an event could happen.

 

Who would have believed that during this unprecedented period of chaos and wealth destruction, that the speculative fervor, unmitigated risk taking, spectacular gains and losses would continue unabated.

 

Who would have believed the incredible parabolic explosion of liquidity and Keno chips.

 

Who would have believed the coordinated attacks on the bears by the Matrix Agents.

 

Who would have believed the widespread maniacal bullishness among the participants.

 

Another article in the WSJ talks about how Joe Retail has grown distrustful of the stock market, and that the perception was that it is currently ?rigged? and ?manipulated?. HedgeHogs now rule the roost, feeding off the Liquidity and Repo Bubble.

 

But none of these ?facts? really matter. We are currently in The Twilight Zone, where black is white and white is black.

 

Last October, the most advertised ?double bottom? in the history of technical analysis resulted in the most explosive rally off all time.

 

This month, the most advertised ?Santa Claus Rally? in the history of seasonal trading analysis is now in play to put in the widely anticipated year end tape jam.

 

And as usual, Al Green stepped in at 3:00am to put a bid on the futures to get thing rolling again, which sent the broad market vertical.

 

Of course, since Al Green has had the Bloomberg Ear Implant installed for many years now, he is the ultimate market technician. As of today, the Investor?s Business Daily mutual fund index had fallen below the moving average line after staying above the line for 31 consecutive trading days, the longest streak since September 2000.

 

The Wall Street Journal also had the broad market resting squarely on the 90-day moving average line.

 

The Dow Jokes broke its 50-day last Friday.

 

Al Green made sure that there would be no ?chart failures? today, hence the hard jam to the upside. What better medicine than a 180 point day on the Dow and a 35 point day on the Nasdaq.

 

Enjoy the Riverboaters ride into year end. Expecting a double top on the Nasdaq, or a run to the 200-day moving average on the S & P.

 

From the Color Commentator:

 

?Loud starter pistol going off point blank into muzzle of Semi Greyhounds preMarket. IBM 'preparing to announce' its new line of faster, smaller little Fab turds. This blurb should be enough to get the Keno action going in the Chip pits since they have been sold off now for several days running and need to wash back up and clear out some put buyers during Capone Week. I mean who are these people? Who is making all these carnival pronouncements? You get more truth out of the All Iowa State Fair in front of the Peep Show booth than you do from the Carneys working the chip sector. I think the greaseballs who used to work the sidewalk in front of Carol Doda's Strip parlor in North Beach are now handling media control out of the Semi sector. The Matrix is alive and pumping and hucksters rotate freely in and out of such diverse fields as strip clubs, State Fairs, anal cysts, Cosmetic Quacks, Pentagon briefings and White House press parties.?

 

 

Position Summary:

 

Covered a lot of my tech positions today. I am no longer going to tolerate any more beatings from Al Green and his Perpetual Motion Liquidity Machine.

 

More positions will be covered tomorrow if we gap up on the open, and we?ll go long on some Supermodels. DELL and AMAT had key outside day reversals today, and look to be the strongest candidates if we get some followthrough.

 

TTWO and ERTS look like good shorts near the end of the year if they move back up on lighter volume.

 

We are 44% short, 16% long, 29% cash.

 

Half Short:

 

LOW at $42

KSS at $66

INTU at $53

C at $38

IBM at $85

TGT at $34

MBI at $50

NCEN at $26 Covered at $24.

SYMC at $42 Covered at $43

 

Quarter Short:

 

FRE at $68

CFC at $49

KBH at $49

LEN at $56

TOL at $27

BBBY at $35

COCO at $40

INTC at $18 Covered at $18

DELL at $28 Covered at $27

ORCL at $11 Covered at $11

CSCO at $14 Covered at $14

 

Half Long:

 

BGO at $1.31

HL at $4.10

PAAS at $5

DROOY at $3.35

GG at $10

GLG at $9

MDG at $16

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Having ridden this (swing) roller coaster up and down a couple times, it can certainly become habit forming. For every proletariat strategy which suceeds, there is a burgeois banker/MM/pig who is designing a counter-measure to relieve me of my money. One day the coaster will leave the tracks on the way up again, by design or by disaster. The game is "when", and its been going on for almost 3 years now.

 

I personally think the 10sigma will be a suitcase nuke somewhere in the heartland. When the intents and purposes of all the Powers That Be is to continue the anti-gravity levitating act, nothing less than this - short term - will stop the train. The public is salivating at reflation: house values go up, stocks go up, CD rates go up, wages go up. Holy Sh*t, Batman, its a RECOVERY!!!

 

The 70's will be a fond memory when this is over. Instead on "Let it Be", the Shrub and Fed got stoned on "Sympathy for the Devil". We are on a course to make a bad problem infinitely worse.

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Global collapse approaches. Greenspan lights up the futures so the sheep average in higher to their favorite pro forma , debt laden companies. Fund managers scurry to piss away other peoples money to ensure their bonuses for destroying lives due to their flagrant breaches of fiduciary responsibilities. GW scurries around looking to blow up anything that looks like a terrorist. Multiples explode based on fake earnings and the fact that "interest rates are low"...where else would you put your money, eh? Stocks that are parabolic get more parabolic. Maria and the team at crapvision spin pension fund shortages as the "buying opportunity" of the century. Bull/ Bear debates never seem to have any bears!! Kudlow has been saying Nasdaq 4000 for 3 years. Kudlow still has a Website that people visit? WOW! And in the meantime Gold breaks out higher on the daily chart but has just broken out on the monthly chart for many of them.....Japan is tanking, defaults sor, debt at all time high, unemployment 6 percent and really higher if it wasnt for govt book cooking, bullishness is rampant....WE can all thank the FED for the depression that we will witness in 2004. Truly the most amazing time in financial history...mostly for the coordinated fraud and manipulation by the government and crporate america. Hard to fight the tape these days, but again, when Greenie needs me to step in and buy some stocks at Dow 3000, i will merely drive by in my Limo and give him the finger. My way of saying "thanks" for all the kam jobs you old prick!!

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The committment to degrade the dollar and inflate the Matrix is on, no question about it. Now that the Pig thieves have rifled thru and emptied retail pockets in equity scamming for 3 straight years, the next shell move will be to debase all the currency in money markets leaving the simple retail dufus feeling like he is getting sodomized in a lock down situation at a maximum security penitentiary. No where to run, no where to hide. Al Green is the warden, numbers of inmates are ever swelling, prison guards like the KC Chicken operation out of crapvision,(Kudlow&Cramer) are stalking the premises with loudspeakers. The run on gold by the few and the proud may begin to resemble a "Treasure of Sierra Madre" type mania if we are lucky. Can you spell HOARDING?

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Mark: From the WSJ article you referenced: "Ms. Traiman began selling real estate again, but found she missed the stock market. She went back to her computer, and started trading again. Among her current favorites: Chinese Internet stocks." THey never learn!

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Thank you Mark.

The obligatory Christmas rally. But not without the obligatory helping hand.

I too will cover more tomorrow if the jam persists. This thing about going long the darling tech stocks still scares me. So far Mark, you have not carried out your threats to long some fast moving cow manure.

You called it correctly on intraday stool this morning. That may have been a good opportunity to go long for today.

The Sox junk I am short all went up approximately 6 1/2 percent. These Sox get pulled up so hard I keep expecting them to rip. Maybe next year.

Machine head.

Okay, I give up, liquidity is pouring in. Gold and oil, and what else?

S. G.

You were right on to cover on Friday. Congratulations. Looking forward to reading your stuff.

Mary freaking Christmas.

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you beat me to it Meta.

 

*** TRIPLE SCAM WEEK ? ***

 

Today we screw the puts, tomorrow we screw the calls.

 

And today is a perfect example of why I don't play the short term or short the glam bitches. BEARX was down 1.3%. Whoppie f#*king doo, I'm quaking in my boots, I'm scared of the biiiiiig rally. Oh no, I better rethink my strategy and go dong !

 

Intermediate term signals *all* still pointing down HARD. Today is an exception day bucking the trend and will not last as a result.

 

Bite me Al. I'll see you in hell in January 03.

 

? Scam Week is registered trademark of CapitalStool.com

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