Monday, September 29, 2008


Thank goodness! Maybe we can salvage some integrity and democracy. The House rejected the proposed bill of goods they were trying to sell us. This country was founded on principals, and part of those are that the government is supposed to be by the people and for the people. The PEOPLE have spoken loudly and clearly, NO WALL STREET BAILOUT! It is sickening to think that the same people who created this mess, including Paulson and Bernanke, will potentially profit from this bill. People, and rightfully so, are sick and tired of the BS. Sick and tired of the lobbiests, sick and tired of Wall Street fat cats pillaging the economy and their own stocks and investors so that they can profit. What happened today is what should have happened today. And, unfortunately its going to continue to happen. The DOW will be under 5000 when this is over, thats more than 50% left in this mess. It either happens now, or the government continues its nonsense and it happens later and hurts even more Americans. I am SO FREAKIN' SICK of listening to "leaders" who are clueless, who repeat things verbatim as though they are fact. Who tell you that we're near a bottom. Why? Not because its based on anything factual, but because they WISH it would happen. How many so-called experts have trekked onto CNBC over the last few months and said NOW is the time to buy FINANCIALS! Even today they were saying it! Even tonight, right now, Kudlow is saying that MAYBE this is the bottom! Folks, this is NOT the bottom! And, Maria says that this is because of the failed bill. That is NONSENSE! The stock market was down 300 points when everyone thought the bill was a sure thing to pass! Enough of the fear mongering, enough of the false promises, enough of the total BS partisan politics. What does it matter who voted for or against this rubbish? They are completely missing the point! The point is a system failure, throwing more and more money is ridiculous! And, let me tell you this, the absurdity of saving families from foreclosure is just that. I sold my apartment recently and thankfully. Why? Becuase I thought the market was going down. I sold it for roughly 20% less than I could have gotten a few months before. Trust me, thats a freakin' lot of money and its money that I surely could use. Everything is relative, folks and I could not afford the place anymore. And, I didn't want to afford it. So, I downsized because I didn't want to be a slave to my apartment. And, because again, I thought the real estate market would tank even harder. So, I rented, and I'm a lot happier, I don't have to worry about all this nonsense. If people are living above their means, whether they are filthy rich and doing so, or they are poor and doing so, then making an adjustment HELPS THEM in the long run. Making it so people stay in homes they can't afford is NOT doing them a favor! It's absurd the notion that everyone should be bailed out. And, its working AGAINST the markets, all of them and it is tanking the economy a lot worse than it would if the markets were allowed to run their real course! First we heard how it was the dreaded short sellers! Oh, they are scary people, those short sellers! EVIL! Yeah? Well, guess they musta been the reason we fell 777 points today, right? Oh, shoot! Can't blame them! You can't shoot the financials! Trust me, I would have made a million today if I could have! It was free money today if so! I made nicely as it is, but jeez louise were there some easy trades today or what?! OK, now we need this bailout to save the markets! It won't work, water will find its own level no matter what, thats reality. So, the notion that the failed package is now the reason we fell is again utter BS and I am sick of it! Did I tell you I am pissed off? Well, hehe, I am! But I am happy they turned this away. It WILL NOT WORK! IT WILL NOT WORK and IT WILL NOT WORK! The stock market is going down! There is NOTHING that could or should be done! I am just happy that I have helped a lot of people, I think, by pounding it again and again to not invest! Stay in cash, or trade, but investing in this market is INSANE! Now, tomorrow is obviously Tuesday. Do we get turnaround Tuesday? I'm not sure. I think that where we want to concentrate on the techs on the short side. If we do get a nice rally, which I hope we will again begin to look for places to reenter shorts! Also, tomorrow is the day when redemptions are gonna come in and so it could and probably will get even uglier here. IF congress passes a bill, I think it'll provide a squeeze for a short time that we can trade off of, but that's all its going to be. We need to be nimble here, folks, and you need to sign up for Thursday's TOP TEN WAXIE SHORTS. Yes, I believe that the there is a LOT more downside and I believe that the stocks I have are going to STILL be down more than 50% from here! Just like the overall market! OK, that's enough ranting, but it's a good thing the market comes down. Oy, OK, I have to say something else because as I write this these knuckleheads on CNBC saying that look, because the bill didn't pass the market lost 1.4 TRILLION and if they passed it then it would have only cost 700 BILLION! Who books these people? That's INFURIATING! Am I am idiot? Seriously, am I? Becuase I must be, since the market was down 300 points into the bill supposedly passing, its a huge leap to say that if the bill passed we would have rallied! And, that's why we will continue to head lower over the long haul, because as I've taught you all, when a market is reliant on outside forces to drive it higher, it has to fail. Why? Becuase there are only so many outside forces to rely on and when they run out, then the market has to eventually settle in at the level it would be without those forces. And, that place, my dear friends is a LOT LOT lower than where we are now. Lastly, I've said this before and I'll repeat it, I HOPE I AM WRONG! I would much rather the markets, all of them, rallied! I'm a trader, I am confident that I will make myself and help my clients make money either way, but unfortunately I am almost always right about this stuff. Sometimes I feel like I'm in the Dead Zone, hehe. It sucks cause my crystal ball says under 5000 on the DOW and under 1000 on the Nasdaq and today was just a stutter step on the way there. Remember, don't try to catch falling knives cause even if you grab them an inch from the ground, they still slice right through ya! I'll see you guys tomorrow. I hate it that I get to say I told ya so, but I did and I have again and again and again. Thanks for the emails thanking That's what we're here for. We're not always right, but we're always passionate and we usually are! TECH death coming soon to a theater near you. SO much for AAPL and RIMM and GOOG and AMZN being the 4 hoursemen. More like the 4 donkeys. Or, 4 bustout stocks. SIGN UP FOR THE SHORT CLASS! Do yourself a favor, I know many of you are worried and scared, take some action to better your position! The class is cheap and at the very least it'll give you some ideas! That, my friends, is worth its weight in gold in this market! GOOG sees $150, you heard it here long ago and you'll keep hearing it. See ya on the other side of 10,000, or turnaround Tuesday! Turnaround or bust Tuesday is what we'll dub it, cause I think we either turn around or test 10,000 more than likely. We shall see soon enough! RULE! Michael "Waxie" Parnss Here is the link to the short class Thursday, sign up NOW! ---- Sign up NOW! The people have spoken, and the representatives, thankfully, have elections in a few weeks and want to keep their jobs! Maybe the worm is turning, ya never know! RULE

Proper link for the TOP TEN SHORTS class!

Here is the signup link; I suggest you ALL take the class, folks!

Sunday, September 28, 2008


And futures are DOWN!

This market is in very serious trouble, folks. I can't stress it enough that we are going lower long term. Protect yourself! The market is really super good for a trader, but for an investor you need a crash helmet. We will be all over the place short term, but long term I stick to my MUCH MUCH lower targets. One way to profit from this down move potentially is this THURSDAY'S class where I will reveal my TOP TEN SHORTS! You need to attend the class, sign up here -

Thursday, September 25, 2008

One more thought and then beddy bye bye...

One thing that's disturbing to me is when I watch supposed news and its sickly biased. I even hate it when I watch a baseball game and the announcers are big homers. I'm a Mets fan, but if they always said the MEts rule the world (Like John STerling of Yankee lore does!), I would hate it BIG TIME! I am a huge fan of some of what CNBC does. I have always said that I would invite them all to my wedding, were I ever to find any woman who would put up with me! Thing is, today was disturbing and a lot of it has to do with that guy Dennis whatever his name is. He's the biggest HOMER, and by that I mean BULL. He always says we should go up, as though the market prints money for investors. He really has no clue as far as fundementals and he often says completely false things that are skewed. I really like Mark Haynes. And, when I was on there the last time he went after me a bit, but he's basically fair. And, he speaks his mind. I like that. Today CNBC reported that they got a note that the last 3 times over the last two years that the Treasuries and credit swaps spread was aligned like this the market rallied 1000 points or more, and it seemed logical that since we were only up roughly 300 points, we had a lot more upside. OK, first off, thats not news, its biased skewed CHEERLEADING. Secondly, the information is only PART correct. Tiny pointed out when we discussed it that YES, indeed, when we have had that spread we have rallied that 1000+ points, but what they neglected to mention is that ALL three times that happened we were in very BULLISH periods, the market was clearly in an UPTREND. Obviously thats not the case currently. Hence, thats wrong info and I am sure many people use that info and trade or invest off of it. When people are worried they act impulsively often and that type of MISinformation, or skewed info is just not right to post without pointing out the other piece of it. DOn't you think its a big deal that each time that happened it was a Bull market? Are we in a Bull market now? 'Nuff said. Its infuriating listening to this guy, I don't know why they hired him, he's horrid and rarely has anything worthwhile to say. CNBC should be as neutral as possible. Worst case should be they want the market to go up, we all do, even me, but it shouldn't be cheerleading, ya know? That's not helpful to anyone and it hurts people and costs them real money. Be responsible for your actions, kind sir Dennis, be responsible! RULE! Waxie


OK, so seriously folks, for those of you who are NOT members, you are really hurting yourself at this point. We are completely blasting this market and nailing it to the post! I suggest you sign up for SOMETHING, this is the best trading market since 1999!

We had a BUNCH of winners today, including RIMM SHORT for a big gain (plus its my top choice from the TOP TEN TECH SHORTS class I did a few weeks ago! In after hours it hit nearly my $75 target! I think its headed to $50 or less ($25 sounds about right).

In the meantime, this bailout package is a total TOTAL joke! It's insane, they keep trying to plug the Hoover dam with a finger!

It's not going to work, no shot in hell. Sorry to be the bearer of bad news, it will not work. The problem is simply too big for them to fix.

A little while ago Washington Mutual basically went under. The branches and the deposits were taken over by Chase. Once again, Chase is pretty smart, they get the best stuff and leave the rest to the government!

This is going to get MUCH MUCH worse, folks. I watched Booyahhead today, I try not to cause I can't take it, but I did just for you guys!

The things I do for ya 'all! Wowsa!

OK< so first off, the guys been saying to buy RIMM for a long time, all the way down. Now its cracked and he is saying to hold it. I'm sorry, RIMM goes MUCH lower, folks. Who with any market savvy tells people to hold stocks into 50% haircuts!

OK, then he recommends Wachovia and Goldman (of course). Let me tell you this flat out, so I am perfectly clear. Wachovia is on my DEATH list, I think it goes under. I've made a lot on it SHORT, so have our clients. I think its DONE, FINI, its got a very similar makeup to Washington Mutual. now, maybe I am wrong, its possible, but who recommends these banks long in this market? You have to be INSANE! And, he did it a couple weeks ago when it was $20ish! How's he doing? I mean, enough already!

And, Goldman (GS)? Folks, GS will see $50 or my name ain't Waxie! I think it sees lower than that, frankly. As I said last night, Buffet did NOT invest in GS! It was a LOAN and they bought him to try to salvage a dying business in my opinion. It's time for people to WAKE UP!

This market party is OVER, so stop and learn and eat your losses and take whats left and put it somewhere safe. The government in my opinion CAN NOT save this. I wish they could, but you know I am constantly warning and calling it as I see it because I care. I don't make money if the market goes down, but I want you to protect yourselves! This market is going MUCH MUCH lower and the people who keep saying now is the time to buy are either on crack, or just in denial. DO NOT BE IN DENIAL!

RIMM today - AAPL tomorrow. GOOG the day after (I am short all of them).

Look, I am not always right, au contrare, but I am rarely wrong about my market calls. I am so strong on this one, take it with a grain of salt at your peril. This market is trading very badly. I have this sinking feeling we are gonna wake up one day soon to a market that is SERIOUSLY done, like toast, like 1000+ maybe 2000+ down. You can say I am nuts, thats fine, but so far you all see, I lay it all out here. I don't pull punches. I WISH, no I PRAY we would go up and be solid and hit a REAL bottom. That would be awesome. BUT, I don't see it happening for a LONG LONG time. You need to play the bounces short term and look for reentries to shorts when we do bounce. The market is telling us its in big big trouble, we need to respect that.

Look at today, we rallied really hard on NO VOLUME and I am quite sure we will sell the news. In the history of the market we have never been saved by outside forces from reaching the proper levels. You can't artificially bump up a market, yet they keep trying.

And, whats horrible is that no one has a clue, they just scramble around, and I am sure it is well meaning for the most part, but they scramble around and they keep trying to throw a band aid on an amputated leg!

What will work?

Sorry to say - NOTHING in this system, the system is broken, its not going to be fixed.

So, what do I suggest? Many of you will say I am insane, you already do. We need to shut things down for a month, or however long it takes to get a REAL solution.

The stock market will go down several 1000 points, and thats GOOD. Yeah, I know, its crazy. Ah huh, its going there anyway, might as well get it over with all at once and rebuild. Thats the only way it'll happen.

And, this idea that taxpayers will get money back? ROFLMAO, thats nonsense, the stuff they want to offload isn't worth anything! This isn't the S & L! It's just not. You can't sell this stuff.

They are trying to please everyone when they should be telling everyone the REAL truth and then just saying its worse than your worst nightmare but we are CONSULTING with 100 of the greatest economists in the world on a solution. We are going to all lock in a room for as long as it takes and get as close to a consensus as possible. We are NOT going to consult with the politicians. We are going to handle this with brilliant people who have NO AGENDA. Booyahead will NOT be invited to this party! Me? Honestly, I think I should be there only because I really don't give a crap about anyone agenda or ego. It doesn't matter, it'll never happen, they will just keep blowing it up worse and worse.

I'll tell you one thing spiritually I have learned, and its the hardest thing for me to do sometimes. GRowing up on the streets and begging and doing whatever I had to do to survive, you don't learn to sit back and take a deep breath. I was told by a very wise person once that the thing I needed to learn more than anything is to STOP, and DO NOTHING!

It sounds simple, but I am so used to reacting, most of us are, we live in a world where things get thrown at us all the time. Yet sometimes the BEST thing we can do is - NOTHING.

I see it with my two girls, they are awesome, but sometimes they can get worked up or work themselves up and I've learned that if I can help them to just BREATH they are almost always fine very soon thereafter. See,if you breath, and you know you are breathing and aware of it, you can't be panic stricken, you can't be really upset, you are concentrating on your breath. I learned that in Yoga.

Our leaders need to BREATH. The impulse to rush to action is not going to help or solve this crisis. I wish it would, but it won't. And, they need to learn from their RECENT mistakes, they keep throwing a glass of water on a Forest Fire and then they see there are more fires they didn't put out. It has to stop, it just has to. Yes, we all want action, but right now INACTION and NOTHING in my opinion is the best thing we can do and its the only thing we should do.

And, let me say this, Paulson and Bernanke should NOT be leading us in this. They helped lead us into this and they have their own agenda. I laugh when I hear them say that the only thing that maters is the tax payers! Be real, they don't believe that and they certainly haven't acted as if thats true.

We need to have a moratorium on action for let's say a week, and then have a REAL open session where we get REAL answers to real questions. Watching the hearing this week says to me there is a lot being covered up. Enough is enough, let's forget what happened in the past and let's get some hard honest answers so we can access the situation and make the tough choices. This isn't about Dems and it's not about Reps, or Socialism or Communism, this is about the people of this country trusting a system that has failed them and having the RIGHT to know the TRUTH!

And, our leaders have an obligation to NOT act, but to let us in on the secret party so WE can make an informed decision and we can get some brilliant people OUTSIDE the system to give us THEIR feedback.

Do you ever think about the fact that we have, as do other countries, some unbelievably smart people? People who have spent their whole lives studying this and people who called this well before me or anyone on the street did.

There are too many partisan issues here. You know another thing I've learned? If the whole thing goes BOOM, it don't matter what your religion is, politics, color of your skin, sexual preferences, it just don't mean a dang thing. The whole thing, folks, is going BOOM, wake up and let's smell the roses together!

Keep writing your reps and tell them to just DO NOTHING until we sort this out. They are acting like scared chickens. Trust me, if they have to do something this bad, this fast, then anything they do isn't going to work anyway.

The market, my friends, goes WAY WAY DOWN in the end no matter what, get used to it and join us so you can LEARN TO EARN!

My new SHORT list is being given a week from today, be there or be square!



Wednesday, September 24, 2008

Don't believe the hype...

Today the market gapped up early (and overnight) on news that Warren Buffet had "invested" in Goldman Sachs and shown confidence in them.

In the end the market closed DOWN and our favorite sector to short (Russell) was cracked again, under 700. I'll stick to my 350 Russell target, so there's still a helluva lot of downside!

OK, so you want the real deal? Here goes; it's a complete and utter distortion to call what Buffet did an "investmtent". He did NOT invest in Goldman Sachs, not at all. What he did is make a bet that Goldman won't go completely under, ie bankrupt the way Lehman and Bear Stearns did. That's all.

He got an unreal deal, a deal I'd personally do. He did a BRIDGE LOAN, nothing more and nothing less - BUT - he got the best freakin' bridge loan deal of all time!

He gets shares at current market price, $5 BIL worth, he gets another $5 BIL worth of warrants to buy shares of GS at $115 in the future, and he gets, best of all, 10% DIVIDEND on his $5 BIL! So, he gets $500 MILLION a year on his money, plus he has the upside on the shares, and the warrants!

Warren Buffet is not dumb enough to invest $5 BIL in a stock that is 99.9% to be under $50 in a year in my opinion. In fact, Goldman Sachs is near the top of my list, still, as far as GIMME shorts! This thing is going down and the people buying it here are out of their minds.

GS will have such a SICK wall to climb to make ANY money moving forward. They only make a billion a year or so and now $500 MIL of that is GONE, to the smartest guy around - BUFFET!

How in the world is Goldman going to make money in this market, with a dead core business, and fork over $500 MILLION to the Buffster? Answer - the SUCKERS buying GS here are just that - suckers. Booyahhead can scream all he wants that GS is a great buy here and this proves it, but he is the same knucklehead touting BSC at $80 and GS at $200s and AAPL at $200, etc,etc. GS will be $25, you can mark it down and say I suck if I'm wrong, but 18 months from now, or before, GS will be $25 or less.

You have to remember, this deal doesn't make GS worth more, it makes them worth a LOT LOT less! The stock should have been down $20+ off this news, but because GS is one of those cultish stocks, it was up big time even in a bad tape.

Now, back to the hearings, it appears that the powers that be may actually do the right thing and force the banks to give up equity/warrants to taxpayers. If so, that should drive down financial shares dramatically, there will be no bailout. The only real hope that the banks have/had is for the government to basically give them a free bailout pass, but that appears highly unlikely. In that case then WB, C, COF and many many others are in serious trouble and should fold. SOV is also trading like it wants to go under.

In the meantime, we really should get a move higher either Thursday or Friday as shorts have to cover into the weekend. NO one will want to be short and worry that the Fed is going to do something and we gap up 300 points. I think whatever gap we get will ultimately fail, just like everything else has. I think we will see below 10,000 by year end, and it may happen in a big bunches. It will not mark anything but a pause in a very bad market.

This is tough dudes and dudesses, but the market is cluing us in. Look at MS today, it gapped with GS but couldn't hold it and then collapsed into the close AND then had bad news after the close. This is a market that is revealing a lot of TELLS, we just have to listen closely!

See ya manana, I'll be taking a class trip with my daughter and then back on Friday, so trade safe and trade smart! CASH IS KING! CASH IS KINGGGGGGGG!

See ya on the other side,


Tuesday, September 23, 2008


The market is in total disarray. I have to tell you, even I thought we would bounce today late day. And, we did! Unfortunately it lasted for a half hour and then they just slammed us to death!

The hearings are insane. The core issue is that they are trying to force this panic bill out there under threat of the whole world ending, when really what will end is a few banks and the 10,000 level on Wall Street!

It's a joke. The best part was when they asked Paulson if the banks are going to sell the asssets for what they are worth and he replied to the effect that the banks won't take what they are worth, they need to pay them a higher multiple!

Are they insane? The banks want to sell the assets for more than they are worth! BUT, Paulson adeptly pointed out that over the long run the tax payers will make money!

Really? Last time I looked when you buy something for more than its worth, you LOSE money!

Also, comparing this to the savings and loan crisis is ridiculous! Why? Because there was a market for those distressed assets. There is virtually NO market for the assets they want US to take off the banks books at more than they are worth!

What's really behind this is the desire to try to manipulate the stock market HIGHER. That's all it is. It's beyond absurd and its beyond obvious. Yes, we should pay more than things are worth, not cut executive pay and not take shares in the stocks themselves to give us some upside!

Where do I sign? This is possibly the most infuriating government intervention in the history of my life. I've disagreed with a lot of things we've done as a country, but I can almost always see the other side of the ledger. With this, I can't see why we are doing this other than pure unadultered cronyism!

I loved it when Bunning asked Paulson when he was CEO of Goldman! That was awesome, I thought Paulson's face was gonna fall off! I'm sorry, listening to this today should make Americans sick to their stomach. This is shameful, disgusting and an abuse of the system and principals this country was born out of. I am sure the founding fathers of this great land are turning over in their graves. ANd, its not a Democrat vs. Republican thing, its disgusting across the board. They are playing Russian Roulette (why not, we're suddenly communist!) with our finances, our futures and our kids futures. All under the BS guise of the world is going to fall apart if we don't rush and do it today!

Yeah, ok, well, how come we didn't fall apart today? I bet we don't fall apart tomorrow, or the next day!

The only thing falling apart is the stock market, and you know why? Because it is VASTLY overvalued by any historical or fundemental measure. So, it SHOULD fall apart, the same way housing prices should have fallen apart. That's what happens, markets go up and markets go down, and that, my friends is part of life. Deal with it! BS happens and it happened today on capital hill, folks, and if you think that these people aren't messing with YOU, you are sadly misinformed. And, I've been killing this market, so I'm fine with it going up and down, I just really can't stand being lied to and manipulated. Tomorrow maybe we get turnaround Wednesday, but it'll have to come on news or capitulation. Funny, I thought stopping the shorts would save us! Who knew the shorts have almost nothing to do with whats going on? Funny, markets should and do seek their own level and no matter what the Fed does longer term this market goes MUCH MUCH lower. They will prop it up again, and we'll go lower again. When they finally give up is when we'll have a true bottom. See ya manana! WAXIE

Monday, September 22, 2008


Dudes and dudesses. I keep wishing I was wrong. I really do. I keep thinking maybe just maybe the Fed can actually "save" the markets. But, they can't and won't and I am right and that's reality. I'm not happy about being right, trust me. Today we had some really nice winners and we are kicking this markets butt. But, the fact that we sold off like this just shows you how jittery and how far from bottom we truly are. If form holds true, tomorrow should be another Turnaround Tuesday! I am leery, however, the market is trading like it wants to go a lot lower. If you look at GS today you'll see that the financials are DONE, FINI, caput! Everyone keeps calling a bottom, its no where near one. My biggest concern is that it feels like we are going to have some sort of cataclysmic event soon that will send us down more than the 1000 pts in a day I'm predicting. I would be very very careful here if you own anything long for more than a VERY short period of time. I've learned over the years that you really do have to respect the tape and right now the tape is saying lower overall, with occassional bounces to ride for a day or a week or whatever, but that ultimately we should head a LOT lower. I guess we'll see soon enough, won't we? :) WAXIE

Sunday, September 21, 2008


OK, now I'm not an expert in some of these things, but I've been asked for help on these things, so I will do my best to clarify. Feel free to shoot me an email if I've mispoken;

THE UPTICK RULE vs. current (well, formerly current) short rules;

The uptick rule means that in order to short a stock the stock has to tick UP. Therefore if the market or a stock was in a freefall it would be hard to short it and pile on. For example, if GS was falling hard in order for anyone else to jump in it would have to tick up. You have to have a buyer to be a seller.

The current rules are that you can short any stock at the bid, even if no one is actively trying to accumulate shares. The arguement being floated now as to why short sellers are particially being blamed for LEH and BSC, et al is that let's say you have a large hedge fund with $15 MIL in buying power (or selling power). In theory they can "lean" on the stock and push it further and further down based on current rules. As the stock falls the credit rating agencies get nervous and downgrade their credit and that drives the stock even harder down. So, it's a so-called "pile on."

With the uptick rule you wouldn't necessarily be able to do that, you couldn't pile on as their would need to be buyers for your selling. So, stocks are less likely to free fall.

having said that, I still say LEH and BSC and the others went under cause they should have gone under. Hedge funds and short sellers didn't make them leverage 30 to 1 and put themselves out of business, sorry. They just made them go down faster. They certainly aren't evil. It would be impossibly to put GOOG or AAPL out of business, they would take themselves private or buy back the stock themselves. LEH, BSC, FRE and FNM were going under no matter what. So were GS and MS until this BS intervention under the guise of protecting us. Hogwash!


There are several ultra short ETFs you can play, like SKF for the financials. Google Ultra Short ETFs for a list and you can buy them and that basically acts the same way as shorting the index. You can also buy puts on individual stocks (or sell calls) or indexes.


Besides the obvious, which is that this is supposed to be a FREE market system and not a communist one, not allowing shorting creates false short, intermediate and long term pricing. If you look at MANY financial stocks on Friday, they hit 52 week highs. How is that possible or logical? It's not, its ridiculous, but thats what these types of rules do. Shorts had to and have to cover their positions and normally they may decide to press and average up to protect themselves. Since they can't do that they are forced to cover their shorts, which artificially drives up the stock, similar to the pile on when short, but instead of a pile on its a pile UP!

Also, many hedge funds are Net Neutral funds. That means they have edicts whereby they must be neautral to the market. If they can't short stocks against their longs then they can't be neutral and they may have to cover their shorts and liquidate positions both ways. Again, this creates false pricing on the stocks.

False pricing for a trader doesn't matter, it actually helps us becuase we have an edge we shouldn't have. For example, BAC is nearly $40 after Friday, I can't wait to buy some puts for like January here. I'll take my chances its lower by then since I don't think this bump can possibly last. But, for the market itself its creating a lot of bad longer term issues and any investors jumping in thinking that we have to go up are going to probably be severely disappointed. They are paying unfair bloated prices. Many fund managers don't know what they are doing and jump in at times like these, not respecting historical patterns, or even recent ones whereby the Fed has artificially propped up the markets only to let the air out later. We've seen that happen several times this year. While there is always the chance that this time will be different, I think its highly unlikely and certainly I'm not buying these things here for more than a trade intraday no matter what.

Hope this helps, please VOTE FOR WAXIE, 2008!


I am pleased to announce that I am throwing my hat in the ring, I, WAXIE, am running for President...

I just can't take it anymore, so I've decided that I am going to throw my hat into the ring. There i s no shot I won't do a better job than the two pretenders running.

Here is my platform;

TRUE economic reform -

We will be cleaning up Wall Street. I will fire Paulson, Bernanke and the entire cabinet effective immediately. They have helped create an untenable situation and are now making it MUCH worse for we, the taxpayer, for DECADES to come. They have sacrificed us in the name of keeping us safe from the "CERTAIN" demise of our entire financial system (rubbish), while helping execs at these same companies that helped create this mess to cash out. By not allowing short selling under this same guise they are guarenteeing that these stocks went up and I would bet every dollar I've ever made that the execs are selling into the rally. If they wanted to do things fairly why didn't they put a moritorium on insider selling? And, is it a coincidence that the only investment houses still standing are Goldman Sachs and Morgan Stanley? Cronies all.

When I am elected there will be NONE of this BS. Why? Becuase you know I don't give a crap what anyone thinks about me, they can all do the right thing or be damned! I can't be bought, so the right thing will happen, you can bank on it! And, I will lead us out of this economic downturn with real job creation, spending money on things that will help us evolve as a society, things outside Wall Street. Things that will truly serve our great country.


My foreign policy will be based on the US regaining the respect and graneur we have lost, it will be a policy of inclusion, working with other nations to solve global issues and creating a much more positive atmosphere. The US used to be looked at as good doers, I intend to restore that respect (not fear) that we've had for generations.

The rest I'll figure out as I go, trust me I'll do a better job than anyone running.

OK, let me say it upfront so that when it comes out in the paper it won't shock anyone -

-I've lived on the streets, I've experimented with many things (I'll let you fill in the blank), I've had two beutiful girls out of wedlock, I'm Jewish but really not very religious, I dropped out of HS, , I have ADD and ADHD, basically you name it I've done it or tried it, and I'm proud of that fact.

If I am elected (when) I promise to serve the people, only. I will not waiver when it comes to moving this country forward back toward greatness. I'll tell the truth even when people don't want to hear it. I'll never lie, and I will never back down if we do need to get tough around the world to deal with terrorism and the like. There will be total equality amongst all citizens.

I haven't really thought this out very much, in case you haven't figured that out, but I am just so fed up with what is going on, its a total joke and something has to be done, if that means I have to become President, so be it. I'm ready to serve you, the people and promise freedom and justice for ALL.


market is gaping down here overnight. We'll see what happens, I would think its fadeable, but let's see what happens and play it by ear. If it wasn't for the fact there are still so many shorts I would say we go right back down. I'm not a conspiracy dude, but this smells so rotten its sick. They are propping the market up so it doesn't collapse before the election, and they are saving their cronies. Thats reality. Anyone who believes this nonsense about the end of the world and they HAD to do this or it would be worse is naive. How could it be worse than taxpayers footing the bill for a trillion or two dollars due to the same people who are now going to be bailed out. Let them pool their money and bail it out, I am sure they could afford it a lot better than the average person in our country. Tonight they announced that GS and MS are becoming bank holding companies. Shocking! This is a joke, plain and clear. If this is so dire they had to do it, then tell me why they didn't do it sooner? Tell me why the day before Paulson said no more bailouts. So, what, it came to him overnight that the end of the world was near unless we screwed the taxpayer under the guise of "the alternative would be far worse". Yeah, sure it would, if you are GS or MS, then yeah, it would be.

yes, I am POed. I find these actions deplorable and I'll say it to anyone who asks. It's sickening. There is no accountability. No one proves anything out, they made grandiose statements and act impulsively. Sorry, but I was born into a country where there are checks and balances and right now there aren't any, there are only conflicts of interest and a bunch of malarky. Maybe it would be the end of the financial system as we know it. OK, maybe thats a good thing, ya know? Bailing out Wall Street certainly isn't what I want my taxes raised for. I don't like the establishment, so VOTE FOR WAXIE!

On November 4th, please vote for WAXIE!

See ya on the other side, of the White House!


P.S> Tiny is my running mate.

Thursday, September 18, 2008

Welcome Comrades!

Good evening, today the United States of Communism informs you, as a citizen, that you have certain rights that relate to your party affiliation. Today I will detail those rights and tomorrow your illustrious, and nurturing, party will take good care of you. However, if you choose not to obey the party, we will simply take you outside and shoot your head off. Your body will be emailed to your former family, since as a traitor to the state, you will have no rights and no family. The state IS your family. If you are a short seller, you are automatically wanted for treason and you face a mandatory life imprisonment, with in extreme cases - death by lethal injection, which Comrade Kerkorian will gladly, eh, I mean sadly administer. This is for your own good, it will hurt your country more than it hurts you, trust me! We have now gone over the edge, folks. Trust me, this Fed has set us up for a MAJOR depression that will last for many years. You simply can not have the government basically take over the stock market! Now, before anyone says "oh, he's just short, so he's mad!" No, actually we nailed the EXACT low! I said 10,500 buy it heavily. I am not short ANYTHING and in fact had my best trading day in a long time today. I NAILED the day, as we've been doing for a while. So, I was happy we did what we did. BUT, its all confetti at his point. The Fed is setting up a sick and I mean SICK downturn that they will be unable to stop. Further, the notion of not letting anyone short the stock market is INSANE. Next thing you know they will tell everyone that they can't sell any stocks either. I mean, why not? Why not make it so that you can only buy stocks and never sell them. Then the market will go to 75,000 on the DOW and 25,000 on the Nasdaq within the next year. That'll be great. Of course your money would be worthless, so making it won't matter, it'll be like paying for things in jellybeans. Now, is that enough on that subject? I could go on and on and on, because this is the absolute WORST POSSIBLE scenario. I have spoken about the perfect storm this whole year. Well, this is what happens when you have an election year. OK, OK, I'll stop, but you have no idea how disasterous this is. It once again gives the market a false sense of security that will be completely bashed once again. Get used to it, we live in a communist country now. Do you realize this is what Pakistan did? What Valenzuala has done, what Russia has done? There is absolutely no way this ends well. NONE. And, anyone who plays this for more than another short coverin BOUNCE is going to get CRUSHED. Did I say you have no idea how bad this is or will be? OK, I'm done, but one more thing! I can not believe they are doing this and no one is stopping them. OK, so I'll admit it, I'm NOT done, but I will keep my mouth shut and be a good communist towing the party line! How's this for speaking my mind? Jeez, louise, I can't believe we are this dumb. Well, I'm not but they certainly are. Now, ok, why do I thnk its doomed to fail? That would take a long time to spell out, but suffice to say that the government is basically making YOU and ME stock owners and by doing so they are diluting the shares, thus basically buying bad debt and bad stocks that can't possibly go up, therefore it's like throwing money away. And, who will shoulder this nonsense? YOU AND ME, the American tax payer. And, why? Not because the whole system was going to break down, which is was and still will, but because this is an election year and both parties are so scared of looking like they aren't on top of things. And, unfortunately most people don't care or don't pay attention and just see the headines and the headlines will read tha the government is working in their favor, when in essence it's the complete opposite. This is setting up DEflation, less economic activity and even greater issues longer term. So, as far as the market goes, we'll see what happens, but just remember that the Fed has done dumb interventions several times this year and each time we rallied like we did today, and maybe a few days or a week or so longer and then rolled over to lower lows. I suspect that happens again, but let's see what shakes out. I basically have NO positions at this point. I want to wait and see what plays out, I'd be guessing for tomorrow since the news isn't all out. I would think we gap up and then from there I don't know. My GUESS is that we go higher tomorrow, there are a lot of shorts that still have to cover and its options expiration (triple witching) so volatility is the name of the game. See ya next week, folks, we are ROCKING! We had MS, GNW (went $4+ for us in about 45 minutes on a $5s stock! and many others! We also covered shorts and option Trader ROCKED once again! LM puts were sold at 1000% gain! Yes, you read that correctly, basially a 1000% gain. Might be 900 to 1000% to be conservative!). Wheeee! RULE - WAXIE

Wednesday, September 17, 2008

Bottom feeders...

Well, to say we nailed this is potentially the biggest understatement ever. Option Trader is insane at this point and our SHORT LISTS are beyond insane, we covered 1/2 those positions (at least) today. GS hit our 2nd target of $100. FNM is almost at our ZERO target. C was under $13, the list goes on and on and on. So much for the BOTTOM! Every day they come out looking for the bottom! Sorry to tell ya, the bottom is now UNDER 5000 on the DOW and UNDER 1000 on the Nasdaq. In between that we'll get a ton of "bottoms" where people say this is a great place to invest, get in now! All that will do is create bigger and bigger losses. That's what happens in Bear markets, the sheeple that listen to booyahhead and others tell us that shorts are the reason we are going down all rush to get in on any sign of a bounce/short covering and then are left for dead. What happened to Booyahheads call that we had hit a bottom in July? Guess not, huh? Unreal. I wish I was wrong, folks, but I'm not. Here's the deal, you know how T.Boone Pickens has that commercial where he says that this is the greatest transfer of wealth in the history of the universe? Well, the US Banking system, and the worlds global economy will have the greatest transfer of wealth into the great abyss that we have ever, or will ever know. Doesn't make any sense to you? Sure it does. Think about this, BSC and Lehman and most of the brokers (and banks) have MINIMUM 20 to 1 leverage. The average investor is leveraged over the money they have in their accounts with margin and such. The average consumer in this country has virtually no savings and is in debt paying anywhere from 5 to 20% interest to credit card companies and the banks. So, what we are witnessing, and why you have to be a complete knucklehead to be a buyer of ANY security here other than for a bounce is that these things are all unwinding and as they unwind and people/businesses come to collect on these leveraged collaterals the money simply isn't and can't be found. It NEVER existed in the first place! So, the idea that you should buy financials here or anywhere is pure unadultered INSANITY. These stocks can not and should not be bought. Not now, not in a year, probably not in 5 years. The pundits keep pointing to history and saying stupid things that aren't true, like "these are the times when you need to be buying, history has proved that out!" Really? What history are they talking about? The history that has never seen whats going on in the market and economy today, or the history that was 2000 to 2003 when the stock market lost nearly 50% of its value on the NYSE and over 80% on the Nasdaq? Which history are they talking about? I just don't get how they let these clowns peddle their wares. Booyahhead has been touting GS and MS for months saying he's buying them. Great, he's only down 50 to 80%. And, oh, yeah, the 4 horsemen! They are rocking! RIMM, AAPL, GOOG, I mean its a joke. And, sick thing is, I am fairly certain that he knows you shouldn't be buying here for more than a bounce. No one can possibly think RIMM is a good deal at $95, I'm sorry, its a $25 stock long term, not a $100 stock. AAPL? It's a $25 to $50 stock as well. GOOG? You all know I think GOOG is a $150 stock in the next 12 to 18 months. So, don't listen to the insanity, you need to be looking here for bounces that are TRADEABLE, and then look for places to get SHORT, cause that's where the real money will be made over the next few YEARS. Look at some of the retail leasing companies now for shorts, like VNO and it's competitors. Even now, after hours, there are tons of rumors that are popping stocks like WB and C and GOOG. WB is up nearly 10% after hours on a rumor that they may merge with MS! That would be wonderful, all it would mean is that they both go under. WB is WORTHLESS, its on my WAXIE Bank DEATH list! So is C, which had a rumor they might buy Washington Mutual! Yes, that would be great, a company that is busted out buying another busted out company! Yet the mere thought that something might happen and investors scramble to buy, not wanting to miss the inevitable bounce! Thursday will be interesting. Bulls will try to make a stand, if we gap up on no or BS news I would look to fade it heavily. We could push down to test 10,500. That will be real key area, if we can hold that area we should get a decent bounce back to the 11,000 area potentially. If we can't hold that then next stop is 10,250 and then 9000s! The most overvalued index is still the Nasdaq and the Russell. The Russell actually is still 5+% over the March lows which were in the 640s. I think it should retest and break that area shortly, so stay tuned. I don't think we can get anything meaningful for a while. Having said that, news drives us here. As I've stated and stated in our BEAR HUNTING class last week (nice timing!) a market that is driven by news is a very weak market. News eventually stops coming and we are still 4000+ points overvalued. Now, having said all that, I would NOT be pressing to the downside here. Let's see what shakes out, when we do get a bounce, and it should happen tomorrow or Friday, particularly if we get that 10,500 test here, it'll probably be a HUGE one. Shorts will cover quickly and investors will rush in to try not to miss the "bottom"! So, last thing you want to do is get stubborn here. The easy money to the short side NOW is done, lets see what shakes out here and RULE! Oh, one last thing, we are doing another SHORT LIST/CLASS in the next two weeks. If you are interested please email me at - pricing will be same as the last list(s) and it'll be my new Top 10 Shorts that I believe will drop 50+% in the next 12 to 18 months, and will also have at least 5 Options plays relating to the Top 10, plus maybe 1 to 3 bonus plays with options! See ya there! WAXIE

Tuesday, September 16, 2008

DUMB AND DUMBER - The life and times of B & P (Fed chairman and Secretary)

First off, as usual, you heard it here first - turnaround Tuesday rules the roost! Nice trading day, to say the least. We had a super de duper day today - WOWSA!

OK, so I'm too tired and ready to go work out for the evening, so I'll start with the end and work myself back if I can.

Today after the close the NY Times reported that the US Government/Fed is loaning AIG $85 BIL and assuming an 80% ownership in the company!

As far as I know, this is unprecedented in US History, or true capitalism. First off, AIG has a market cap of $6 BIL at the $2.60 it closed after hours at. So, loaning a $6 BIL company $85 BIL seems quite remarkable.

Secondly, I bought some AIG at $2.30s afterhours on the news as it seems to me that if its true, there's a good shot AIG somehow remarkably rallies because the government will look even dumber (hard to believe). If the news is wrong then AIG will go the way of LEH and BSC more than likely, but I have a feeling they may just be dumb enough to have done what the Times is reporting.

In Capitalism the government does NOT own publicly traded companies! That's what happens in Venezuela or other parts of the world where they have dictators! The government owns companies! Here? How could they possibly be this dumb. I know I'm repeating myself, I just can't help it, I said it would happen, but even pessimist me didn't really think it would happen!

The futures were down 150 points and rallied to PLUS 100 after the news. Wednesday is going to be quite interesting. I think this news is HORRIBLE, but the market has its own way of interpreting things. Mine is almost always right (did ya see GS at $110s! Just as called!), but the market has this wrong if we rally, which we probably will. Why? Because this is desperation time, folks, and unless anyone is naive enough to think that AIG is the last problem company, this is setting a precedent that will have ripple effects far beyond AIG. Remember, then the Fed bailed out BSC we rallied hard and went much much lower. When the Fed bailed out FNM and FRE we did same and just retested those lows. This move? This move stinks to high heaven of socialism or communism, like I said, in those societies these kinds of things happen. And, when AIG ultimately does fail, which it is likely to do (hopefully after rallying to $12 tomorrow!) then what? The government has NO IDEA what to do here. We rallied today simply because we had to squeeze. So, in this market just wait for rumors and even though 99% aren't true (todays there were at least 10 or 15 relating to AIG and LEH) the market pops because shorts get nervous they will get squeezed.

I'm really in a state of shock, where does it end? Another 85 BIL the taxpayer is on the hook for! Enough already, this is beyond insane. They are busting the entire country out because they are just so clueless.
DUMB and DUMBER strike again!

BUT, its a gift for us, just means we can reshort at higher prices. S & P over 1200s here again, and stocks are going to be a short soon enough again. Stocks like C and WB bouncing big off this news simply is misreading the situation. These companies are done, they are Dead stock trading!

In the meantime, I'm off to the gym, we'll see what shakes out tomorrow, should be a very nice trading day, though we might not go much of anywhere. We'll see - RULE!

See ya on the other side,

Michael "Waxie" Parness

Monday, September 15, 2008


I was right. I trust most of you guys and gals heeded what I've been preaching for a long time here. The stock market is NOT going up in any meaningful manner, other than short covering rallies, for a LONG LONG LONG LONG time. Figure 2012 as a good target. The stock market is going to be at least 4000 points lower, potentially more. The entire financial system as we know it is going to be caput, it already is but no one wants to admit it.

GS reports in the am, I say GS sees $50 or less by years end now. I think you can kiss the ENTIRE sector goodbye. BSC, LEH, MER (what crack was BOA smoking?) - all DONE. MS, GS, LM and others to follow. Like I've also said, I WISH (trust me) I was wrong about this. That would have been wonderful. I would much rather have everyone say I SUCK! Then have the market just totally destroyed.

I won't gloat, it's not a happy day. We get paid good money to make market predictions and suggestions. I would much rather have us move higher and give you longs that work, then have us completely tanked and do it right that way. Unfortunately, this is going to get so much more worse than anyone can imagine. This is the REAL Y2k, folks. This is the financial equivalent of that, but its not a fantasy or fear, its real and it can't be stopped. The Fed can cut rates to zero and pump 10 TRILLION into the markets, it won't matter. Think about this, when most of the financial district in NYC is a ghost town, what happens to real estate in NYC? What happens to the rest of the country?

The senate is trying to pass another $50 BIL "stimulus" package to send people $500 checks! Wonderful. As I've said, the only thing that is going to happen is that WE, the tax payers will be on the hook for up to TRILLIONS, so giving back $50 BIL is similar to like taxpayers paying themselves! And, what's scary is that both candidates are basically for the stimulus package because they want to look like "heros". Since all these bailouts and failures get kicked back to the taxpayer, then how could it matter to give you your own money!

It's sickening. And, what's really sickening is that it could have been prevented, or at least dealt with to stem is sooner and have shorter lasting effects. I'm a nobody, I have no training in economics and I am SO sure I had this nailed on what to do. And, if thats the case then clearly the powers that be just aren't listening to people who do have some real ideas outside of throwing more bad money after bad money!

When the dust settles the financial landscape is going to be so vastly different. There is simply no way that we can come out of this ok, without huge scars.

The Fed will cut at least .25 and maybe .50 Tuesday, it won't mean anything unfortunately, and any rally is going to be just a tease. Russell still has 50% to go to be priced correctly. And, we're probably headed toward some runs on some banks shortly. It's going to get ugly and its going to get much more ugly than people want to see.

I got asked today by many friends where to put money. I put some money into treasuries. is where you can, I think, purchase treasuries directly. If treasuries go under then we'll be using sea shells to pay for things again.

C and WB looks next. MS and GS will join them. Our puts across the board are making clients a TON of money. Look, folks, if you haven't signed up for OPTIONS TRADER, you need to do so, if you are reading this then you have an interest in making money. While there are no guarantees all you have to do is look at the 3 SHORT lists I've given, the Bear class we did only last week, and all the while we are catching much of the move.

Watch AFL and other insurers, that sector could get a huge haircut next as well. I like AFL short.

OK, so now that I've beat you all over the head with gloom and doom, let's look at some stuff here. It's Tuesday and as you know we often get Turnaround Tuesday! We've also "only" 900 points away from REALLY big support at 10,000, which I think we break down to SOON. Actually, futures are down 150ish as I write this, so we're only 800 points away from 10,000 and lower!

ANYONE who is buying financials here is an idiot. I'll state that as a fact. It's amazing that anyone would be foolish enough to buy them for anything other than a short covering rally.

Watch us tomorrow, it is so key what we do Tuesday post GS earnings. I suspect GS will see sub $125 tomorrow or this week, but I guess its possible they will blow out and go higher. Today on CNBC Merridith Whitney, who's been dead on through all this said that she feels C and WB are in a world of trouble. IF C and WB "fail" and have to be bailed out, SKF should be $250 minimum. I am shocked we weren't down 1000 Monday, I really am. Nikkei is down 600 points as I write this. The markets are getting CRACKED throughout the world.

OK, there ya have it, I've been clear, I remain BEARISH even when we bounce. BUT, if we get a nice gap down, I'll still be looking for entries to the long side for a bounce more than likely! THat's cause I'm a TRADER and you should be one as well!


Sunday, September 14, 2008


First BSC, then FNM and FRE, now LEH and MER and next GS, MS, LM, C, WB, WM, etc,etc,etc. I wish I wasn't right, but I have warned ya all for MONTHS now. We may bounce at some point monday, I really don't know, I do know believe that we have a LOT of downside and ZERO upside longer term. The Nasdaq has 1000 points of downside. The DOW has 5000 points of downside. If you are long, you are WRONG! Protect yourself, folks. I keep getting emails saying that "I'm down so much, I can't sell now!" Really? If it was me I would take the loss and reset and stop the bleeding. Worst case you can always reenter when the smoke clears, so? Put your cash in treasuries and take it out of the market unless you are going to TRADE. This is a market that is ready to CRACK, whether we bounce Monday or Tuesday or we go down my 1000 tomorrow as I've called. It doesn't matter, we are going down LARGE no matter what, it's better to eat it then compound it. I don't have much else to say. We did tell ya so, we even gave a great class a few days ago on BEAR MARKET trading. I have given now 3 lists of stocks to SHORT, if you heeded and played these lists you would be up HUGE so far. Here is my basic plan early Monday. I would cover some shorts near the open and then set stops on the rest. There will be a lot of talk that this is the "BOTTOM"! It's a joke, but the market may get a bounce nonetheless. BSC bounced the markets, and so did FNM and FRE. I want to maintain some exposure because BSC, FNM and FRE all bounced the market but then we tanked, so they may not be so quick to bounce us Monday. We'll see soon enough. Good luck, make sure you are patient and pick your spots! So much for oil down, the market up, right? Hmmm! RULE! Michael "Waxie" Parness

Thursday, September 11, 2008


As usual, gap down proves to be VERY buyable, it remains my favorite TREND EVER! Fading the Gap = ROCKS!

Of course, we rallied for several reasons, one was/is the belief that LEH marks some sort of inflection point, the same way BSC did and the same way FNM and FRE supposedly did. LEH looks more than likely to be worthless and the Fed and Treasury are trying to figure out how best to let everyone know. Never know, maybe they are worth something, they seem to think so, but it doesn't look good, that's for sure. It's certainly no inflection point regardless. MER looks like it wants to follow LEH and C should come after that. WM was actually rallying after hours.

If LEH does go out worthles, what does that say about the general health of the financial markets? The problem is, we are still in a state of denial, as though the problem really isn't all that bad. And, that it'll work itself out one by one. I love that, yes, that might be true, one by one all these companies are going to go out of business, so it'll all be fine and dandy!

We are still stuck in this trading range of 11,100 to 11,600. Until we break one way or another we'll just keep bouncing in and out of those ranges. Now there is a call for the Fed to lower rates again! Why is it that people refuse to learn that the Fed can not and never has saved the stock market. They could cut rates to zero, we're still screwed, sorry, the truth hurts, and as I have said before, I hope I'm WRONG! I would love to be wrong, but these bounces we get are shorts covering and PRAYER, and thats all.

A gap down Friday should be BUYABLE, though. RIMM reports earnings next week and the calls for the Fed to cut should stall a huge selloff for now, though I wouldn't be rushing out to go long for more than a trade, if at all. Gap fade either way should be decent off today's move. We'll see, but if the 11,600 level holds then we have a decent downside move coming up here shortly.

C feels very heavy to me, if it tries $20 again I think its a gimme short. We shall see what we shall see soon enough.



Wednesday, September 10, 2008

1000 point down day, coming SOON!

I'm beat, folks, but wanted to write SOMETHING!

We are going to get that 1000 point down day shortly I believe. This market is on the verge of busting to the July lows and less!

We are kicking butt, and rockin'!

See ya on the other side


Tuesday, September 09, 2008

But, but, but I thought we had bottomed!!!!

Ho Hum, another day, another reason to ONLY trade and forget the notion that investing is something that makes any sense whatsoever.

We rule this market, truly. They actually tried to rally us early and we shorted the hell out of it, catching ZION, COF, POT, and of course riding our GOOG and AAPL puts while those stocks continue to try to find their way out of the box of hell they are in. And, we even saw the usually unflappable Steve Jobs succumb to the old "evil hedge funds" spreading rumors about his health as the reason the stock is crumbling. Frankly, that's reason #1 to stay short AAPL for the long haul. Obviously its horrible the guy has had health issues, trust me I am not insensitive, but just say what's what. I think AAPL goes under $100, I stick to that call. I was called nuts for saying FNM and FRE go to zero before probably just about anyone. I was called nuts for saying RIMM sees $50 and its under $100 now. Or, GOOG to $150 and its about to taste $300s. GS will see under $100. MER will see under $15. WAKE UP and smell reality, this is what a bear market looks like, all the nutjobs who held FNM thinking that the Fed wouldn't let it fail, all the people who have held LEH while they keep saying nothing is wrong, the market and the EVIL hedgefunds are at fault! Yeah, sure they are. And, they also put BSC out of business, ah huh.

Let me know when ANY CEO or the Fed is held accountable for the COUNTLESS lies they have told and continue to tell in order to prop up their stock price, and at times while they sell their own stock. I would get arrested if I did anything remotely as EVIL as that. Tomorrow am LEH is supposedly prereporting "earnings" to try to stabilize the stock/company. Let me tell you something, there will probably be people buying LEH tomorrow, perhaps the stock will squeeze. My view? They are TOAST, and any rally is shortable. have you noticed what happens EVERY TIME we rally on Fed intervention, or some idiot CEO who says everything is fine? Last week FNM and FRE said they were FINE and WELL CAPITALIZED! They have been saying that for MONTHS, and yet anyone with half a brain knew they were going under. Duh. And, one of the "HEROS" of the market, Bill Miller, apparently bought $150 MILLION worth of their stock recently. Didn't the guy read their 10K? Didn't he look at their balance sheet? Look, I'm not infallable, I make a lot of dumb trades, and losing trades. Buying FNM and FRE, or BSC or LEH or ANY financial here long is not something I would do. EVERY SINGLE DAY they come onto CNBC saying that the bottom was set in July. Yeah, sure it was. Look at the AG stocks, my one regret here is that I knew they would fall like this, my timing was off as I thought I'd have a better entry. Can't win them all, but our clients remain HOT AS HELL and racking up the BIG Ka-chingos!

As I write this the futures are up all around. Today we were down MORE than we were up yesterday, if that doesn't tell you its time to TRADE and time to FADE any and all up moves, babies, I can't help you, and you are wasting your time reading my blog.

Best shorts here;

and just about anything tech, TWM is a good way to play the impending meltdown in the Russell folks. Should see north of $100 in the not too distant future.

Me? I'll trade 'em as I see 'em! If I'm long it's for a trade and if I'm short, it's sweet and petite and it's for as long as I want to ride it. I have a feeling that the next retest here we are gonna see around 10,500 or lower. Mark it down. Oil is now $100 and we still fall, hmm, wonder who said that would happen!

We are in psychotic market mode, folks, and that makes it, at times, like shooting ducks! Quack quack goes any analyst who says to buy financials here.



Monday, September 08, 2008


VERY VERY nice trading day! Today was almost the perfect trading day. We gapped up HUGE, faded it like a mad dog, and then rallied hard into the close. So, we got several big moves. Best of all, we caught SKF premarket at $96.80 and it went about a measely $12! We also got LEH short for $3s, GS for $4s. And, of course you faithful readers caught GOOG for the $30s fade, right? AAPL, right? Ka-chingo!

This market is like shooting ducks, baby! This is a great trading market right now. I'm hoping we get some more upside Tuesday, we'll see. I think some of the beaten up energy and metals stocks could get some short covering as well. Remember, nothing goes up or down in a straight line...except FNM and FRE! I won't gloat, but everyone who took the TOP SHORTS class I gave a couple of months ago should be ROCKING, to say the least. I said and have said time and again right HERE for you all, that FNM and FRE would see ZERO and thats exactly where they basically are.

I think Tuesday the gap should be fadeable unless its a very small one. I think most will be looking for us to chuck the rally up, so a decent gap down should be buyable for a TRADE. This rally can't last that long, but we could go back to 750 on ER and 1300 on ES. I'm tired folks, or I'd give ya some more juicy nuggets. Trying to get back into the swing of things day by dayyyyy!

Keep trading and OPTIONS TRADER fyi had SKF calls and rocked intraday! We also have GOOG puts which are doing pretty darn good, don't ya think?


*Anyone with a good testimonial please email me if you wish to be in our infomercial. Also, our BEAR HUNTING class starts TUESDAY! Sign up NOW or miss it! Email me at - for more info and to sign up!


Sunday, September 07, 2008

The FED saves the market!!! The FED saves the market!!!


Once again the Fed has interferred with the capital markets in a destructive way. While this Waxie me is all for the Fed supporting the system in a constructive way, the notion that the Fed is now going to stem the drop in home prices is absurd and irresponsible.

Further, it will lead to even more bank failures. And, finally, it's good we now live in a socialist country. Since that's the case, the government should start by paying for my health care! I never thought I would see a Republican administration act more liberal than both Demoncrats and are more closely aligned with communism then they are their own party edicts. And, I'm not a Republican, frankly these days I would like to start my own party, you guys and gals can all join me. It'll be something like the "Independent Traders" party. I think I can run for President with my platform being that I'll just shoot for the hip. At least I'll be honest about it.

OK, so I got a couple of emails from clients this weekend asking me about the financial sector and where I see it headed. I love SKF if it can dip to $100. That's severely strong support and while the market is capable of once again misinterpreting this Fed move with FNM and FRE, which was a given and anticipated by EVERYONE anyway, ultimately we should end up right where we always have in this bear market. We get a pop off a stupid Fed strategy and then we head even lower. I think this large gap up, assuming it holds from Friday, is very fadeable. Not sure we just die Monday, maybe we get a bounce that lasts a few days even, but ultimately we should be under 11,000 (I think under 10,500) sometime in September.

Another large regional bank was taken over by the Fed this week in Georgia. There are going to be 100s if not 1000s of such shutdowns and takeovers before this is over. The Fed can't bail out the world and we are unfortunately now keenly entrenched in a global recession and probably depression. The Fed should back up FNM and FRE debt. They have to, but they certainly should not be trying to prop up the real estate market. I watched part of Booyah-head on Friday. I have to say, he should just go work for the Fed since they seeem to listen to every knucklehead idea he has. The notion that the Fed adjusting everyone's mortgage to keep people in homes they can't afford is patently irresponsible. And, it also rewards, at tax payer expense, people who simply made bad investments. At least it appears they will not be bailing out shareholders of FNM and FRE, so those two stocks should head to the ZERO I said they both would months ago (FNM is on our TOP Short list from $20s with a prediction of ZERO as a target).

And, hence why this is a VERY bearish (ultimately) move by the Fed for the market, particularly the banking sector. What the Fed has made clear now, with BSC and FNM and FRE is that they will willingly bail out the system, but they won't (at least up til now) bail out shareholders. So, when C or JPM or LEH or MER or WB or (for sure) WM are ready to fold, and many will, the Fed will bail out the debt, but they won't pump up the stock prices. So, these stocks remain GREAT shorts. Look at SKF, its only about 30% off the 52 week lows. It's already pricing in a recovery, which is absurd and completely disconnected from reality.

I said Friday would be interesting and we should get a bounce, and we did. This week will be very telling. If we can not hold a gap on Monday we should see under 11,000 very soon, probably this week. The Fed is quickly running out of bullets and the world's economy and markets are crumbling. To think we are immune is, as always, Rose colored thinking and doomed to failure. Use any strength here to sell your investments is my call, and if SKF sees $100 I would look to take the Oct. or Nov. $100 or $110 calls and hold them. Tech is really starting to roll over here, even with the late day pop, AAPL and GOOG both were down decently. I would watch them for further weakness.

We shall see soon enough! RULE!


Thursday, September 04, 2008


Well, at least for investors. I have to say we should be thankful the market isn't 7000s which is where it should be right now. The fact that even after today we are over 11,000 is AMAZING. This market is so vastly overvalued its absurd. GOOG, AAPL, RIMM and all tech is DEAD, just stick a fork in it and short it on any rally. It'll be interesting tomorrow morning. Trin was ridiculously high and the #s of course will be horrid, but we SHOULD get a bounce on the news unless the #s are just so dreadful. The interesting thing will be to see if it lasts and sustains for the day, or if its just another reason to short. It's a friday and we are oversold near term, and shorts have made a ton this week, so some short covering certainly is more than possible.

This could be an inflection point here. We are going to get cracked shortly, this could be it, or perhaps they mount one more BS rally attempt (maybe tw0) before the fall below 10,000.

I did say that the nonsense about oil falling and the market rallying was dead, and it certainly is. Oil can go to $50 and the market is still going down, sorry folks, its media nonsense that its connected. This is about a GLOBAL recession and a system wide failure that can't be fixed without a major overhaul. Oil has nothing to do with that unfortunately. If it did it would be an easy fix. The media and government like to pin oil and commodities because they can use NONSENSE agendas like offshore drilling and solar energy and say that that will help the economy. Blame things outside your control. REALITY is that this was created by policies that have spanned both Democratic and Republican watches. It's been in the making for a very very VERY long time (several terms). Greed created a society that has had no fiscal responsibility or self monitoring. It's created a "buy now" and worry later society where the average savings rate is less than ZERO! It's created this idea that everyone DESERVES to own a house, even if they can't afford it, and it was created because corporate greed/profits has run rampant. The stock market should be 7000s on the DOW and 1200 on the Nasdaq. OR LESS! That's what most companies are worth. Yet we have this insane notion that we deserve 10% returns on our money every year and that along with everything else has helped foster an insane situation where we can only go DOWN ultimately. GOOG is $450. When its $100s let me know cause that it where it's going. People forget that stocks used to trade for 5 X's earnings. This market still has companies trading at 10 or 20 X's REVENUE. That can not possibly be sustained. All we can do is trade it up and down. I hope we stay over 10,000 for a while, but I think by year end we should be below that level. If and when we lose 11,000 it may get very ugly very fast. Of course, with the election upcoming the Fed will do more BS things to try to artificially pump up the market. Those rallies have been and are SUCKERS rallies. Buying them for more than a trade is absolutely idiotic.
Some of the safest shorts are; MSFT, CSCO, INTC, and many of the big cap techs and banks. I still can't believe C isn't under $10 yet. It will be. COF should be $15 and it's $42s still. Next week will be very telling, folks, stay tuned and stay the course! RULE
Oh, Option Trader called GOOG puts today, they were up about 50% intraday. Ho Hum, that service is ROCKING!


Wednesday, September 03, 2008

Thanks for all the well wishes...

I appreciate all the well wishes. It's been rough for my family, we are very close knit and it was sudden and my mother had just turned 65. We finished sitting Shiva last night but I am taking it easy for the time being. I teach my clients not to trade much, or at all, when they are out of sorts, and I am such, so I think I will heed my own advice for once (or twice!).

In the meantime, this market looks fairly ripe for a larger move down. I was hoping we would (we still may) get that move to 1350 everyone seems to expect on the S & P, but I think you can start to look at shorting some tech here. You see what's going on with commodities. It's very interesting. Now the financials are showing great relative strength. It's insane, but you gotta go with the flow and that's the flow at the moment. GOOG busts and holds below $460 watch $300s within 60 days I think. ORCL reports shortly and GS and LEH report shortly as well. It's again interesting that LEH now has all these rumors about being bought out by various parties. Perhaps it'll happen, but just remember that BSC had the same type of rumors before they went under. I'm not sure what LEH is worth. If it didn't have all the bad debt it would be worth a lot, but with it? I mean, I'm not an analyst so maybe I'm way off base but they are leveraged 20 to 1 and have billions of bad debt it appears still to be written down. How much of a premium can someone pay for that?

LAZ insiders selling 300 MIL in stock at $37 with the stock at $39 today. Hmm. I just don't know why that sector is holding up so well, although I do, we are ready for an election and the FED continues to put the proverbial finger in the damn!

Again, watch tech, it looks very vulnerable here, just like the Ag stocks and the solar stocks looked when I pointed them out before this tumble. GOOG, AAPL, RIMM, etc. look very vulneable. MSFT as well, which could easily fall below $20 in the next 90 days.

I'll probably see ya all manana. Thanks again, life isn't all the market, ya know?