Corepuncher's Account Talk

[mojo]

AIG will not exist in four years, says chairman

http://www.telegraph.co.uk/finance/...ll-not-exist-in-four-years-says-chairman.html

 

[justbizness45]

The President is now asking his supporters to go door to door to get support for his budget!! They sent out 14M e-mails. 14M people being asked to go out get other people to support enslaving their children. What a crock!!

http://news.yahoo.com/s/ap/20090318/ap_on_go_pr_wh/obama_video_4

 

[nasa1974]

So CP how do you really feel?

 

[steveg]

Nice post, CP.

Very "Denninger-esque"!! I like it!

I simply fail to understand how PRINTING MORE MONEY to BUY YOUR OWN DEBT makes any sense whatsoever. What kind of geniuses do we have running this ship??

Steve

 

[cbackous]

I couldnt help but hear the Prez say "AIG failing was an unacceptable risk". I would Beg to differ.

While this would cause a massive hardship, the system would correct itself over time. Maybe this "unacceptable risk" is held by the people that have been living beyond their means all these years, and the companies that let greed and bad business run amuck.

I see no need for the govment to control capitalism, thus, they shouldnt have bailed out these "bad" businesses. If they want to place restrictions on a company they give tax dollars to, that makes sense. In the future, if a business gets greedy (risky) and falls on their face, dont help them up.

I still cant understand bailing out companies that ran themselves into the ground. what kind of a message does this send to the responsible people?

 

[Steadygain]

But this Rally is more than your typical bounce


I'd previously voted for the 741 - but I think we'll hit well above 800 before this is done.



My hope is this RALLY will take you and others way over 10%

Posted when even the thought of 10% was just a dream

 

[kenney1880]

About $300 billion in longer-term Treasury purchases (and longer-term paper to Ben Bernanke probably means up to 10 years in maturity) will drive that yield down and make the deficit that much easier to finance. This is how World War II was financed: The Treasury Department issued debt and the Federal Reserve bought it. The large foreign owners of our debt, the Chinese and Japanese, will be thrilled by this as the value of their paper just jumped in price.
The downside to this is the dollar should weaken. But it won't be as bad as it could have been because the rest of the world is so much further behind the U.S. in addressing the problem. We are the best house in a bad neighborhood and the currency will reflect that.
At some point this enormous liquidity surge will prove inflationary, but that is not today. With unemployment still rising, wages moderate and ample unused capacity in the system, it will be a while before inflation needs to be addressed. And when it does, we should all raise a cheer to the success of saving the system from the threat of deflation.
<http://secure2.thestreet.com/cap/prm.do?OID=012340>
The stock market will like this, at least for a while. The fundamental situation of the banks improves with this as funding costs will go lower and profit potential improves. The rally has been so sharp that I do expect a rest period soon. We need to keep in mind the reason the Fed took these actions is that the economy is so bad that truly extraordinary moves were required."

 

[Gumby]

Posted when even the thought of 10% was just a dream

Geat call!

 

[Corepuncher]

About $300 billion in longer-term Treasury purchases (and longer-term paper to Ben Bernanke probably means up to 10 years in maturity) will drive that yield down and make the deficit that much easier to finance. This is how World War II was financed: The Treasury Department issued debt and the Federal Reserve bought it. The large foreign owners of our debt, the Chinese and Japanese, will be thrilled by this as the value of their paper just jumped in price.
The downside to this is the dollar should weaken. But it won't be as bad as it could have been because the rest of the world is so much further behind the U.S. in addressing the problem. We are the best house in a bad neighborhood and the currency will reflect that.
At some point this enormous liquidity surge will prove inflationary, but that is not today. With unemployment still rising, wages moderate and ample unused capacity in the system, it will be a while before inflation needs to be addressed. And when it does, we should all raise a cheer to the success of saving the system from the threat of deflation.
<http://secure2.thestreet.com/cap/prm.do?OID=012340>
The stock market will like this, at least for a while. The fundamental situation of the banks improves with this as funding costs will go lower and profit potential improves. The rally has been so sharp that I do expect a rest period soon. We need to keep in mind the reason the Fed took these actions is that the economy is so bad that truly extraordinary moves were required."

Kenny, you sure make it sound innocent enough I wish it was that simple.

 

[Steadygain]

Geat call!

Thanks Gumby

The PROBLEM is - I didn't realize it until the evening of the Day I went 100% G Fund and got stuck in jail.

So I kind of felt like '12%' making such strong declarations

Amazingly I also felt very much like Ebb n' Flow during this last rally so I've finally gone the full circle. Now I know about everyone over me and it's really cool to cheer them on.

 

[JTH]

Guy who punches cores to a pulp (pun intended), congrats on the tracker.

With all the hype produced by people within these markets, it's easy to forget the the only thing that counts.

Actions speak louder than words, and price pays. As always, great timing!

 

[steveg]

CP -- no posts in a week? Come on!!!

 

[Corepuncher]

CP -- no posts in a week? Come on!!!

I've been lamenting my poor judgement in my newly opened trading account. I should just stick to TSP!

Anyway, until people stop buying dips, this rally will continue. Technically we are sound, only minor pullbacks. I would say 845-875 is a good target, could even hit 900 but not sure we can make it.

Chart attached...triple financials (FAS/left) and inverse (FAZ/right). 20 day chart. Note how we are forming a pennant on the FAS, after a big up move. For the same period, the FAZ is basically "dead"...instead of a "triangle", it's just a straight sideways consolidation. Maybe I am biased since I just went long FAS, but it looks like it could break out of the triangle to the upside, while FAZ could fall off a cliff. Triple short financials is a scary place to be, IMO.

I'm looking for FAS to break out above 7, and challenge 8. At that point, I will cover at least 50%. I think there is some meeting about mark to market rules on April 2nd, THU. Watch how financials perform ahead of that. If they do not rally, or slowly sell off, they may be poised to sell off. That is because they SHOULD be buying the rumor ahead of this meeting.

Maximum upside near term I see is 11-12 ish should they suspend mark to market. That is about a 100% gain from 6!

 

[Uptrend]

I've been lamenting my poor judgement in my newly opened trading account. I should just stick to TSP!

When I started, I had to learn the hard way. Here are some simple rules I use:

Trade only in the prevailing market direction I can't stress this enough. You are right about FAZ, as it is very high risk at the moment, unless held for very short periods of time.

Trade only stocks with relatively high daily volume, so you can get out when needed.

Buy when on sale and when specific technicals are met

Don't be a pig, when you get 10-20% return, phase out unless further upside is supported by technicals

Buy, short stocks that meet supply/demand requirements

Always set a stop beneath your trade. A 7% loss is easier to take than a 40% loss. Set the stop just below the trading channel boundary, or if you got in late from perhaps a gap up, then use the 7% rule. Don't worry about a few losing trades, if your winning most of them.

I have had a great month in March so far. Increased 110% with 5 trades: DXO, ABK, DAL, DRYS and BAC. Love these Bear Markets! Trade Carefully.

 

[XL-entLady]

When I started, I had to learn the hard way. Here are some simple rules I use:

.... Buy, short stocks that meet supply/demand requirements

Uptrend, sincere thanks for sharing your trading rules. Could you please elaborate on what you mean by "stocks that meet supply/demand requirements"? For what you're reading in fundamentals? For your portfolio diversification needs? For what the country is buying at Walmart?

Thanks again. And would you consider joining us over at EFTTalk too? We would love to have your considerable expertise in our discussions there!

Lady

 

[Uptrend]

Lady:

A supply/demand example is in energy. When energy consumption fell off last fall the companies that provide energy services also got hurt. Take HA as an example

Last October HA fell off a cliff and would have made an excellent short, partly because of lessening demand for services related to the core industry.

Another example is NFLX

You can see that it fell off initially last fall, but America still likes movies and are trading a night out for movies at home, and thus the surge. This stock would have been a good long and terrible short. I think it is overvalued now, and might be a short candidate.

What I forgot to mention in my previous post was asset valuation and how this is linked to the US dollar (USD). Since the dollar was falling lately, oil shot up, because it is merely being revalued with a weaker dollar chasing the same amount of goods. Also solar always chases oil. Lets see what happened in March 09 with a falling dollar.

As you can see, changes in the currency can be very profitable. This is part of the thinking of getting into the I fund on a falling dollar. Hope these ideas help. Trade carefully.

 

[Uptrend]

Corepuncher:
Moving these conversations to ETFTalk, so as not to spam your TSP thread. My apologies!

 

[JTH]

CP ya know I lov ya man, but your FAS has just got to go!

My FAZ may be hibernating right now, but at anytime the bear can wake up and mop the floor with the financials ... :cheesy:

Honestly, I'm still wanting to see a textbook 838 rejection, but hey I'll take what the market gives.

 

[Corepuncher]

What if they suspend mark to market or soften the capital requirements...FAS can shoot way up. FAZ is scary because if we do recover, FAZ will never go back up. At least with FAS, you would think eventually the market will go up...

That is my take anyway! Worst case by and hold...WORST WORST case, the S&P goes to 150 and the amount of money I lost in FAS anyway would be irrelevant.

 

[JTH]

That is my take anyway! Worst case by and hold...WORST WORST case, the S&P goes to 150 and the amount of money I lost in FAS anyway would be irrelevant.

I hear ya buddy! I'm actually building up a small hedge in my regular broker account. I'm buying stocks held by FAS, just not FAS itself. As for the FAZ, we just don't know what it will do. After the peak, the volume picture changed. As of this moment I'm down 56% on FAZ. It takes balls of stupidity to hang on to this rollercoaster...