Tuesday
August 19, 2014
Apology.
I apologize for not reminding you last Wednesday that it was “International Left-Handers Day”
My bad.
I have been SUPER busy finishing up the final touches on a few items for Italy Class – PREMIUM SELLING to start on Sept.1. Could this be the best time to be selling premium as volatility swings around for the first time in MONTHS?
Keep in mind the following:
Keep in mind the following:
Historically September is the ONLY month (since 1950) that is down for the year (on average). People are so afraid of October crashes that they sell in September. This creates a high volatility environment. Yehaw!
Great Morning
Closing Prices From Yesterday
Today’s Number(s)
Yesterday and Today
Yesterday
WOW…it is hard to think just a week or so ago I was being told I can’t see that the market is crashing. I saw it falling, yes. But I didn’t see anything that would tell me that the thing is broke, or as I put it “not just another one of the 10 corrections we have had in the last 3 years”.
And in all fairness, this drop was miniscule compared to what we had in February, or last year when the government shut down was going to end capitalism for all time. We were told by politicians that there would be no police, fire or teachers. Somehow we still can afford them, and the politicians who were creating the fear.
So the Dow closed up over 1% yesterday. The Dow is only 162 points away from 17,000. The SPX is only 16 points from ALL TIME highs. We were up 16 points yesterday because there was no war over the weekend. I got news for people….we don’t have wars most weekend….lol.
What was surprising was that we staged this move higher despite bonds falling. Most rallies higher (of late) have been killed when the bonds started to sell off. But then again, last Friday the 200 basis point move higher in the bonds was a little stupid. Being short the bonds is tough when they wont go down, and it seems like a lot of people took losses all at once.
TODAY
Real numbers out today.
My first inclination is that we are up so much so fast since the bottom a week ago, that this is going to be the “blow off” top coming soon. I have been talking for 2 years about not thinking the end is near until we get a parabolic run higher. A run higher so strong that little kids are cracking open their piggy banks to buy a share of Pixar. We have had a strong and large run higher, but it has been slow, tame and lethargic. It has been more of a climbing a wall of worry than a bullish frenzy.
BUT if the numbers come out just right tomorrow we could get another sick day higher, that would put the SPX at all time highs, the Dow at 17,000, etc.
But don’t get cocky. We are long in POT class because you can’t fight a tsunami of buying, but we are going to start getting short hard, big and into Defcon 2 stage.
I am not sure if the drop happens in September or later, but September would be the perfect storm. This is the weakest month historically. Scott will be traveling (which is historically good for a >8% move down), we are finally getting some panic buying, the world is in chaos and all of this has been ignored. Putin is sending in Trojan horses and no one seems to have read the Aeneid. Can it be that not one single politician in a position of power went to private schools, or was Dr. Suess mandatory reading for them?
300 Empty trucks can’t be a good thing.
Future
This is completely absurd. Yes this market is going higher and going to continue going higher. It shouldn’t but you can’t fight what it is doing. But the more gas in the shuttle, the bigger the explosion when it stops going higher.
There is going to be SO MUCH OPPORTUNITY when this thing falls, it is not funny. Remember the 800 point drop a couple weeks ago. It looked and felt bad when going through it. Imagine that every day for a month, two months, or more.
So if you have a friend that is in the market and unhedged. Have him download our Basic Book for free in the iTunes store. Have him go to another firm. Just have them learn. We don’t care who they learn from.
Bill Fleckenstein, President of Fleckenstein Capital, told King World News that he anticipated big problems for stocks and bonds down the road.
Fleckenstein said that easy monetary policy has led to a misallocation of capital and that no one has seen what happens when central banks print as much as they have since the financial crisis.
“Bonds are a joke, yes, and stocks are a joke, and which one is going to crack first and which one is going to lead to more trouble, I can’t tell you, other than both are going to be big problems somewhere down the road,” he said. From Fleckenstein
Contract the office at 1- 855 – RWT – 0008 for more details.
POT is held each Wednesday night at 7:00pm eastern.
Too True To Be Funny
Attorney Stuff
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