Wave Chasing

Well, the Fed woke up and gave us a 75 basis point cut this morning. The Dow opened down 460 points yet finished off the day down 128. I don’t know if the selloff at the open was a final capitulation or not, but the fact that we didn’t have a disaster is a good thing. We did hit the same high on the $VIX that we hit during August’s meltdown – could also be a sign of a bottom, but only time will tell.

Tomorrow not necessarily looking very good – the market did not like AAPL’s guidance and it was off 11% in after hours trading the last time I looked.

Opened:
2 AAP picks

Closed:
NLY, +2.91%, held 6 days, AAP pick

Month to Date:
My ports: -12.60%
Brokerage: -10.85%
BBE Overall: -14.02%
% of Trading Targets reached: -310.51%
I’m screwed ratio: 49.1 to 5.5

Not necessarily fixing anything, but we’re down 161 at the moment, off the lows of off ~500 down.

However, we still have margin calls this afternoon – we shall see how the day ends.

We still need a plan for the bond insurers.

European markets got POUNDED on fears of recession in the US economy.

Now that we’re screwing up other countries markets, I cannot think of a better reason to bring forth the “substantive additional action” that has been promised by the Fed. Lord knows if I were in London, I would be seriously pissed off at the lack of Fed intervention that has caused my market to drop over 5% in a day. (Or over 7% in Germany.) US futures are very, very red today.

The time to take action has long since passed, but it is not too late to at least get started getting this mess fixed. We need to show the world that we’re not going to hang them all out to dry. The timing is perfect – emergency teleconference today or tonight, then a pre-market announcement tomorrow.

50 points tomorrow morning, 50 at the meeting.

It would be a start.

What I am more concerned about is continued silence on the part of the Fed. They would prefer to see domestic and global markets crash than actually do something because it might look like they are bailing out Wall Street. Very, very shortsighted as far as I am concerned.

I guess we’ll know tomorrow.

Again, we started the day off nicely. Helped by some of the stimulus package “things we want” getting leaked. And then the President had to open his mouth… Here’s the wonderful insights we got from our fearless leader:

“Yeah, we’re gonna do some stuff and you know, stimulate the economy and stuff.” You know, if you have already had specific info of your proposal leaked, you might as well acknowledge it. You don’t have to promise it, but you could say, “Here are some of the things we’ll be proposing to Congress.” Instead, he just left us swinging in the wind.

Then we got to hear Paulson and another gent from the Council of Econ Advisors – hey, maybe here’s a chance for some specific information! I mean, they would be the guys who would be working the nuts and bolts of it, right?

“Yeah, we’re gonna do some stuff and you know, stimulate the economy and stuff.”

You’re doin’ a heckuva job there, boys. We’re talking an economic staff that is right up there with the FEMA crowd when Katrina hit. Gotta wonder who is going to keep their job once the administration changes over. Hopefully none of them.

Dammit, I realize that no one wants to be a slave to Wall Street, but there are a lot of plain, normal people who are getting hammered in this. Teachers, plumbers, retirees – people who are in index funds and other mainstream investments that are getting their heads handed to them. These aren’t hedge fund managers or 19 year olds speculating on penny stocks. The inaction is hurting EVERYONE.

I am so disappointed in this administration on so many levels.

The only positive take away I’ve got on this is that the real money is made at the bottoms – not the tops.

ETA:  Gene Simmons for Fed Reserve Chairman!

Opened:
AAP pick

Month to Date:
My ports: -11.38%
Brokerage: -9.12%
BBE Overall: -12.27%
% of Trading Targets reached: -274.44%
I’m screwed ratio: 49.1 to 5.7

So, the day was off to a nice start. Up – yes, UP! And then the Philly Fed Index came out and wasn’t pretty. And then Bernanke went to the hill to testify and essentially gave the markets the big “FU” – at this point, I’m not even sure we’re gonna get 50 basis points at the end of the month.

So much for “substantive additional action”, huh?  Well, I guess sending markets into turmoil counts as action.

I swear, the next time he testifies, a letter writing campaign needs to be started to Congress to get decent questions out there. They were stopping just short of genuflecting in front of him. I am exceptionally concerned that the fact that the S&P is over 15% off it’s highs and no one seems to care that Bernanke hasn’t taken any real action.

Closed:
[a] APH, +1.82%, held overnight
[b] IMA, -8.46%, held 5 days (stopped out)

Opened:
GTrades pick

Month to Date:
My ports: -10.57%
Brokerage: -8.97%
BBE Overall: -11.58%
% of Trading Targets reached: -259.12%
I’m screwed ratio: 49.1 to 5.8

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[a] EW

Nothing we didn’t already know in the beige book today. Will Bernanke take action? Honestly, just what IS it going to take to get a mid-meeting cut? The economy is in genuine danger of fully going into the tank. Just because a cut might benefit the market, certainly doesn’t mean it shouldn’t be done. Seriously Ben – 50 now, 25 at the meeting.

Closed:
[a] MR, -13.41%, held overnight (stopped out in a big, ugly way and then of course, snapped back. D’OH!)

Opened:
2 GTrades picks
EW pick

Month to Date:
My ports: -9.29%
Brokerage: -6.99%
BBE Overall: -9.93%
% of Trading Targets reached: -221.25%
I’m screwed ratio: 26.9 to 6.0

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[a] GTrades

Citibank trashed everything this morning, got a tiny pop this afternoon and then INTC had a double miss on it’s earnings call. Can you say limit down in the morning??

I’ll admit – I capitulated today. Dumped a bunch of stuff that I should have dropped a couple days back. (Lesson learned – I’m a moron.) But, with INTC’s aftermarket implosion and the spread to the rest of the Nasdaq, it’s probably for the best.

Tomorrow would be the PERFECT opportunity for the Fed to come out and make a cut. Completely, utterly, PERFECT. Will he do it? Of course not. He’d rather we go into a full on recession. I really think that he has some weird thing against people who are trying to make money in the stock market – and he forgets it’s not just rich people on Wall Street. He will let the entire economy go to hell in a handbasket before he does something that might be perceived as bailing out the market. And then it’s that much longer before we’re back on track.

Come on, Ben – keep your word and make the cuts. Give us 50 now, 25 at the meeting.

Opened:
2 GTrades picks

Closed:
GRMN, -31.06%, held 9 days
ISRG, -20.59%, held 9 days
EXPE, -20.69%, held 20 days
FAST, -11.21%, held 9 days
ERTS, -9.91%, held 9 days
all 3×2
SLT, -10.5%, held 5 days (stopped out, GTrades)
INTC, -11%, in/out (Double miss on earnings. Nice.)

Month to Date:
My ports: -8.90%
Brokerage: -5.76%
BBE Overall: -9.13%
% of Trading Targets reached: -202.44%
I’m screwed ratio: 20.4 to 6.2

Big Blue set a very nice tone for the day. In this market, I can see why you’d want to get any good news out there as soon as you could confirm it.  Who knows, if we can get some more good earnings numbers, we might end up with an up week after all.  Nice to see the port turn up for a change.

Of course, PPI is tomorrow – could be a “bad news is good news” situation giving the market the confidence that the Fed WILL stand up and act as needed, but you never know.

Opened:
AAP pick

Month to Date:
My ports: -6.54%
Brokerage: -3.32%
BBE Overall: -6.50%
% of Trading Targets reached: -142.27%
I’m screwed ratio: 49.1 to 5.8

Well, AMEX came out and warned today and that sent everything to hell in a handbasket. Absolutely no residual value from yesterday’s Fed commentary or BAC’s acquisition of CFC.

While I don’t think the Fed should be a slave to the markets, the continued softness in the economy and the very real threat of recession show that they really do need to cut rates again, and soon. Some say we need full capitulation first – I’d prefer they actually get in front of the problems rather than chasing them. The Dow, S&P and Nasdaq are all over 10% off their highs. I don’t see the need to go and retest the August lows, thankyouverymuch.

I still think Monday morning would be good timing for a cut. It would show the Fed is ahead of things for once.

Opened:
[a] AMZN
2 GTrades picks
AAP pick

Month to Date:
My ports: -7.24%
Brokerage: -4.09%
BBE Overall: -7.20%
% of Trading Targets reached: -155.74%
I’m screwed ratio: 49.1 to 5.8

He “stands ready to take substative additional action” if needed. WOOHOO! Rally!! Wait, what exactly does he mean by that? And why haven’t they done anything else? Are we getting a rate cut before the end of the month or not? Huh? I’m sorry, “additional”?? Does that mean they’ve already taken substantive action and no one told us?

As the wind came out of the sails over all that, the announcement of BAC taking out CFC came through and saved the day nicely.

But overall, I wasn’t exactly blown away by Bernanke’s speech.  I think he still has his head buried in textbooks, and this is real life.  There are still rumors of mid-meeting rate cuts, but I just don’t see it.  I certainly wouldn’t mind, but the way this Fed has approached this, they’re always behind the curve.

Closed:
[a] ATLS, -9.86%, held 7 days (stopped out)
[a] ANSS, -9.99%, held 6 days (stopped out) – somehow this one hadn’t been entered in the WaveChasingPort file. It’s now at least in the history – sorry!

Opened:
GTrades pick

Month to Date:
My ports: -5.82%
Brokerage: -3.24%
BBE Overall: -5.87%
% of Trading Targets reached: -124.54%
I’m screwed ratio: 49.1 to 6.1
Long to Cash %s: 90.35% to 9.65%

~~~~~
[a] GTrades