Cramer Freaks Out On CNBC

Too busy for a synopsis right now. I'll look for a video of it later.

Says credit market worst it's been in over 20 years...

Says we need Uncle Ben to give a rate cut "to save us"...

Lunatic!

FLASH: He may have put a near term bottom in the market... meanwhile, CNBC, I guess there is a problem with BSC afterall... see my earlier post today for commentary on that. And, by the way, he just made himself "unfire-able." Just imagine the conspiracy theories...

UPDATE: Cramer came on again in the last hour and was cool. Said he didn't mean to scare people but he was concerned about "how tuned in the Fed is" to the problems concerning the credit market. He said that "all the problems will go away if the Fed says 'we're monitoring the situation and we're not going to let it turn into a debacle'." Says Fed should switch their stance to "ease" and problem will be gone.

Here is a link to the video. If you missed it, check it out... trust me.

CNBC Discusses BSC Downgrade

I have to say it's interesting that CNBC is pulling out all the stops to defend Bear Stearns today in the wake of a downgrade on the company.

Last I checked, S&P makes it their business to analyze and make recommendations on the credit ratings of companies. And, last I checked, CNBC makes it their business to disseminate business news.

However, after I heard Mark Haines declare that the people who sold BSC today were "lemmings" and that "Bear Sterns is in good shape" I felt it necessary to write this post.

I mean, I don't claim to know a goddamn thing about what kind of shape BSC is in. It just bothers me that some old person, sitting, watching the TV might consider acting on buy or sell recommendations provided by a TV news anchorman.

After Mark Haines, we were treated to Bob Pisani talking about what great shape BSC is in while bullet points on the screen tauted their liquidity, etc.

At least Steve Leisman was there to talk about something real, the credit default swap market. He simply explained that BSC is paying more to fund their lending right now. No opinion involved, it's just a fact. Perhaps this is what S&P was looking at when they made their recommendation.

And I don't know if they offer Steve Leisman out there to balance out coverage, but anyone who watches also knows that the other "newspeople" kind of treat him like a class clown... so they let him say his piece, but then they all make fun of him.

Anyway, I'm just writing this post because should the shit hit the fan and these problems spread I want these people to be held responsible for touting stocks instead of simply reporting on them.

Oh, and one note to Trish Regan. Please.... stop yelling!

UPDATE: Bloggerdotcom sent me this interesting article that dovetails with what Cramer was saying on CNBC yesterday. Of course, it's from thestreet.com, so I guess that's to be expected.

Cortney Tidwell, "Eyes Are At The Billions"

Yeah, so I've posted this before... I'm sure you didn't notice.

I'm posting it because it blows up halfway through the song and I think it's apt to what's happening in the market. March and April there was this girl singing in this dreamy voice, things were nice, flowers blooming, birds migrating... get it, like the market? and then WHAM! The flowers die! The birds explode! and the market freaks out!



NOTE: Speaking of exploding, I suck so far today...

Beta Band, "Dry The Rain"

Back from surf. The winds shifted overnight and I got a little throttled today. I tell you, surfing when you're in your early thirties is a whole lot different than surfing when you're a teenager. I'm still working on conditioning...

Anyway, here's a mellow song for a mellow start to the day. Excellent song, very catchy, made famous by the movie High Fidelity.



How about that poll over on the right sidebar? Almost 50-50! Perfect really... no one knows what's going to happen!

Daily Show Does Subprime

Good stuff.

Hopefully, when I figure out that I've failed as a trader I can try and fail as a writer for The Daily Show. That's my dream really... to be a failed comedy writer. Ahhh.....



NOTE: I won't be here in the early morning... waves too damn good to do research. Instead I will be surfing. So I plan on getting to my "desk" at 9:15am, taking a glance at the futures and firing off a bunch of orders pre-market. I will then close all of these orders out at 9:40 and start a book I've recently purchased about "losing your ego."

You see, that's the beauty of the money I made these last couple of weeks. Now I can afford to buy books. Because I plan on being poor again in the near future I am stocking up on books about spirituality. This way, even if I am poor I will be spiritually superior to you, "Rich Wall Street Man."

Yo La Tengo, "Sugarcube"

"Are you scared of making money?"

A Real Snoozer Until...It Wasn't

After all of our recent excitement, today qualifies as a real snoozer.

My best and only really interesting trade of the day was a short in FED.



This was a risky trade because I initiated my short while the stock was still rising around the $46.75 level. However, I added slowly and was watching some of the other mortgage names, MTG, DSL, RWT and JLL come off their highs. FED just took a little longer to melt. I got more than half my position off above the $47.50 level, so I scaled in smartly.

I covered some around $46.50 and the rest down by $46. I pulled in a little over a grand on the trade.

Other than that, I really just took some small scalps on either side of the market. We were rangebound all day long so I worked on my patience and didn't trade too much. Had I done the same yesterday I wouldn't have missed out on all the fun post 3:30. But anyway...

I hope this doesn't put an end to all the volatility. I don't think it does. After yesterday's crazy short covering into the close I figured we might see a day like today. I'm writing this post at 2:30, so who knows how we'll end. The market is having a tough time moving in either direction. That employment report tomorrow could be a big deal and perhaps we'll have to wait until then for more movement.

Anyway, the dog days of summer are here. It's 90 degrees outside and I'm not sticking around. Off to the beach for some surf and dinner with friends.



UPDATE: Okay, so I wrote that part of the post at 2:30 and I thought I was done for the day. I should have been because I just gave back half my gains in that nasty "rally" at the end of the day. I'm sure I'm not the only one, that was messed up. Check out what happened at the end of the day. I got chopped in TNH and in MA... and I don't think there was one stock that you would have been safe in... fucking robots.

Here's the stats:
P&L, $487
Best, FED, $1075
Worst, MA, -$405

shares traded, 29,000
19 stocks traded, 5 winners, 14 losers
160 total trades

Virtual Office, $2145. Dow, +100.96, 13463.33.

Evolution, $887 on 134,200 shares traded.
HPT, $500 on 20 contracts traded.
Me, $487 on 29,000 shares traded.
OBAT, $271 on 5800 shares traded.

Off to the beach. I'll post more later.

Hybrid Market Integrity & The No-Uptick Rule

A very interesting "Stop Trading!" segment on CNBC with Cramer this afternoon.

If you missed it, here were a few key comments.

Erin and Jim spoke about the integrity of the market right now.

Cramer said today is "exactly like October 1987" in that you "cannot trust the prices." Cramer claimed that the market was in "incredible disarray" and that he has been "refusing to trust the quotes" and that it has really effected the "homegamers" because they "haven't been able to trust the pricing this week." Bottom line, he claims we couldn't trust the market in February (when the Dow melted due to a computer glitch) and you can't trust it now.

While they didn't mention the hybrid market outright, Cramer has been railing on it lately and I'm sure this is what he was referring to.

Also, and this pertains to some conversations that we've been having at "the Fly's" blog recently concerning the now dead "uptick rule" Cramer claimed that all of the action in BZH yesterday was due to "bear raids." As he explained, "You can drive any stock down because of the no uptick rule." Erin concurred and stated that the no-uptick rule was "causing a lot of the troubles" of the last week.

Interesting stuff indeed. Perhaps Cramer has been reading this blog. I've been all over the "freaky hybrid trades" from the beginning. It's about time it's getting a little more notice from the main stream media.

The Clash, "Complete Control"

It's been awhile since I posted some music. Since it's hard to see who's in control of this market, I figured I'd give up and hand the control over to the Clash. Enjoy!

Lycanthropy

A tip of the hat to Jake Gint for this gem.

lycanthropy: n. 1. a mental illness in which one imagines oneself to be a wolf. 2. the magical power to transform oneself or another into a wolf. lycanthropic, adj.

It's Quiet

As I predicted yesterday, I think that huge run-up at the end of the day took the juice out of this market for at least a little while.

This morning, we are witnessing a tug of war between the bulls and the bears with neither side really gaining an edge. For now, with the Dow up 30 points, you have to hand it to the bulls because the market digested the huge afternoon run from yesterday and is holding on.

However, volume is currently running at lower levels than it did yesterday, so conviction to the upside may be lacking. Time will tell.

I'd be very surprised if we didn't see the market take a dip at some point to test yesterday's rally.

As for my trading, I've made a good chunk of yesterday back and I'm watching to see if we can break out of this tight morning range one way or the other.

NOTE: Dylan Ratigan just schooled Herb Greenberg... nice!

Stock Earnings, 08/02/07

Here's your stock earnings "cloud" for Thursday, August 2nd.

AG-BEC-CEDC-CHE-CIR-FRT-FCL-GPRO-GSF-IVGN
ITRI-NTG-OII-OSK-SOHU-SPW-SUN-TK-TTEK
RIG-USMO-WTW-WSH-WYN-EYE-ATG-ATK-AIV-RATE
CNQ-CPLA-DNR-GET-GNK-ITG-KBR-MAC-MGM-NRG
NYX-OMG-PPL-PWR-RRI-RDC-SRE-HOT-SFY-UNT-WCG

The poll I've added on the right sidebar is pretty evenly divided so far. I think we can expect to see that type of division in the market today as well.

Doves, "The Cedar Room"

The audio on this clip is weak, so turn it up!

Bitter Tasting Medicine

Well, my last trade of the day was this:

15:35:05 Sell 400 MTG @ 34.25 (flat)

I took a quarter point loss in the trade but more importantly, took myself out of the market for the rest of the day because my self-imposed loss limit had been triggered (-$1500). Immediately after I sold out, the market ripped.

Painful but I only have myself to blame. I traded like shit today.

Whereas in the last few days it seemed that whenever I entered a trade it immediately moved in my favor, today the opposite happened. I took a lot of small losses (and a couple of big ones), over and over again and they added up.

A perfect example of my awful timing today is shown in my worst stock of the day, MA.



I bought the stock just after noon and quickly, almost before I was able to react, lost a point. Then, I waited a moment before I sold (hoping it would bounce) and lost another point.

Another bad loser came on my first trade of the day. I short GHL at the open and lost a quick, clean point.



Also interesting today was the movement in TNH.



When the stock broke $100 on that huge down spike I bought. Problem was that I bought too much.

With my system putting me on liquidation only mode if my P&L even ticks down to -$1500 this stock was simply too volatile for me to be holding as much as I was. I was filled at around $99.75. With my early loss in GHL (and a couple of other less significant losses) I didn't have that much wiggle room. So when the stock traded down to $97, it triggered my account loss-limit and I was left to do only one thing, sell stock. I couldn't buy any more TNH or any other stock. This messed with my head and when it came back close to breakeven, I exited the trade for a small loss and then watched it rise up over $103. Frustrating.

But nothing can match the frustration I felt watching the market rip in the last 30 minutes unable to get involved. I felt like a eunuch or something. It sucked.

The point is however, that I deserved to be sitting on the sidelines because I wasn't trading "right" today. I just wasn't timing my trades correctly and I should have been a little more careful so that I didn't put myself in the position to get stopped out by my system.

I haven't updated everyone on my system loss limits. After my success of the last week, I upped my loss limit. I did this after Wednesday of last week. I upped my loss limit for two reasons... first off, I made some good money and felt aggressive again. It's hard to be aggressive with a $500 loss limit. Also given the market volatility, I thought that my limit was too tight, for exactly the reason that I pointed out in the TNH trade.

Anyway, so today wasn't my day. I took my medicine which was watching the market rip from the sidelines because I had traded irresponsibly beforehand. I hated it. That is something that will stick with me and I'll be more respectful of my loss-limits. When I feel I'm not "on" or the market isn't "acting right" I'll be less apt to churn and burn and more apt to sit and watch for opportunities so I don't die the death of a thousand small cuts.

Here's the stats:

P&L, -$1624
Best, SPG, $376
Worst, MA, -$755
shares traded, 50,400
30 stocks traded, 12 winners, 18 losers
265 trades

Virtual Office, $2067. Dow, +154.28, 13366.27

Misstrade, $1746 on 3400 shares traded.
HPT, $1500 on 54 contracts traded.
Evolution, $872 on 143,500 shares traded.
OBAT, $340 on 5600 shares traded.
Denarii, $50 on 1000 shares traded.
Bubs, -$817 on 13,600 shares traded.
Me, -$1624 on 50,400 shares traded.

There was a lot of volatility in the market today, but it was a different, choppier type of volatility that is, until 3:30 when the market went straight up parabolic-style.

What I'm getting from these past few days of trading is that the 1460 level on the S&P 500 futures seems to be pretty important. We paused there a few times today and basically chopped around that level. This was also an important level in January because it basically marked the highs just before the February panic. What that means? I don't know. I'm just spitballing here.

Anyway, lets see what tomorrow brings. I'd say that this rally in the last 30 minutes of the day is "encouraging." I'm kind of expecting the market to settle down for the next couple of days with smaller swings. Why? Because the Bulls were freaked out initially, but with a rally like that we saw in the last 30-minutes I'm sure more than a few Bears are freaked out as well.

In short, expect a big stare-off tomorrow ahead of Friday's employment report...

Stock Market Volatility

While the talking heads on CNBC have been blabbering about "volatility" all day long, you'll see that so far, that's not the case.



There has been extreme volatility in housing stocks and in mortgage names, but the rest of the market has been locked in a chopfest.

I'm not saying that we won't see overall market volatility today, but so far, "Clarence, the rodent of stock market volatility" is sleeping in his bed of cotton balls and wood chips.

UPDATE: Clarence woke up. Actually, it was me who was sleeping. Volatility abounds!

Stock Market In A Coma

If you're trading stocks today, watch your ass.

As we move into the middle of the day we are caught in a nasty range. Every time to market dips just below the range, every bear in the world gets short while every bull says, "bargain!" and buys. Every time we peek above the range, the opposite happens.



This is leading to a chop fest on the futures and in stocks. However, if you look at the futures graph, it just looks like a flat line. Market in a coma, I know, I know, it's serious.

Clarence has once again left the building. I expect him to return for the afternoon.

Carry on.

FLASH: There is a fairly feeble attempt to rally the market. However, despite the completely wrecked mortgage stocks, I cannot find much rallying. The AD is still weak. I think we'll have to wait until the afternoon to see if this holds.

Stock Market = Death Machine

The stock market is slaying investors and traders left and right this morning...

It's 10:45 and I am off my lows but having a tough go of it so far... we will see what develops.



UPDATE: 11:05, just went positive on the day. Still, it's a bloodbath out there.

NOTE: TRISH REGAN needs to go away... where does CNBC find these people?

Stock Earnings, 08/01/07

Here is your stock earnings "cloud" for the first trading day of August. This list is heavily edited. Since the market is moving so much I haven't traded many earnings names this season.

ACAS-AU-AOC-BBBB-BRP-BRE-BWLD-CAM-CT
CEPH-CMG-RIO-CCI-ENH-ETR-FSLR-BGC
LFG-LNC-MPG-MRO-MIL-OIS-RNR-VPRT
AGN-BEC-BRY-CEDC-CBI CIR-FRT-FCL
GPRO-LAZ-MA-OSK-PH-SPW-RIG-TRW
USMO-WYN-GRMN