Sunday, November 30, 2008

Think tank...

I am thinking about putting together a "think tank" of experts in various fields that will deal with a myriad of issues relating to hardship(s). These would include;

1)Economists to come up with ideas on how best to protect assets (and/or grow them, besides trading!)
2)Medical Experts
3)Mental Health professionals on dealing with stress in trying times
4)Law enforcement professionals on dealing with unrest and self defense

Anyone else who has any valuable ideas.

If you feel like you have something valuable to offer email me -

Thanks. Yes, I know, I know, I'm a stock dude, hehe!

OK, I will give you a tip - fade the gap in the am either way, assuming we get a decent one, should work pretty well!



Ideas on preparing for the worst...

while still hoping for the best!
I got a myriad of responses, keep them coming! And, thanks to all who have so far taken the time to respond with some ideas. Quite a few people are pointing the Gold. And, quite a few point to Peter Shiff. Just want to remind you that Peter Shiff recommended you protect yourself by buying European stocks as a safe haven, if you'd have listened to him youd be down well over 60%! 'Nuff said!
FYI - I'm up oh, some 1000% or maybe it's 2000%. No biggie, hehe!
I'd rather trade then invest in anything. What I'm trying to do is diversify and hedge against a dollar devaluation, which I think is inevitable. BUT, the problem here is that right now, and potentially for a while, we have DEFLATION. You can't make money with Gold in a deflationary period more than likely. I own some Gold, I may buy maybe 60 to 100 more ounces just to have some, but ultimately I don't trust gold and it's something gold bugs always think is going to go to $10,000. On a chart basis it looks like it has a better shot at $400 again then it does at the $2000 for some reason everyone seems to think it'll get to. Also, remember, I recommended Gold at $275 and bought a bunch for myself there, and sold most of mine at $1000. I can rebuy some and still be ahead of the game all around, I just don't think its a safe haven and I'm only interested in pretty sure things. Farm land is interesting, if I didn't live in NYC I would probably buy some. Living in NYC makes it hard for me to do that sort of thing and take care of it. Plus, if we get an extended deflationary period, which we may, then land prices will contract as well. I am pretty sure the government is going to lower mortgage rates to 4%. If they do I will buy some property as that would be worthwhile. The problem is that THAT will be when they devalue the dollar more than likely, so the $2 MIL house is really a $1 MIL house priced at $2 MIL, the dollar will be way lower then. And, frankly, this is the problem with this dilemma our powers that be have helped create, they have created a deinflation/inflation bubble at the same time. In the '70s we had for the first time Stagflation, well, they have outdone themselves this time and we have both de and in - flation butting heads. That's a tough situation to have safe haven's in. In deflationary times you'd want Cash. In inflationary times you'd want Gold or property. Now? You're kinda in never never land either way! Frankly, I think the best investment is just to short the markets long term and get huge returns if you do it right. I just cant see us higher a year from now. THings could change and as I've detailed I guess if they devalue money enough the DOW could go up since it would then really be going down, but would appear to be going up due to dollar devaluation.
BOttom line is, all ideas have merit, or at least most do, but nothing strikes me as a sure thing. And, I feel I am a pretty sure thing to make money trading, so I don't want to invest in things that are iffy. To me, and I know many of you disagree, Gold is iffy. I'll have some, but last thing I want is something that even if it does go up, which it very well may, it's unlikely to counter the devaluation in a meaningful manner.

Keep the thoughts coming!!! And, remember to sign up for the WORLDSERIESOFTRADING.COM to win $2500 in cash and prizes each week! THat's one way to stay ahead of the curve! It's FREE, no purchase necessary!



Saturday, November 29, 2008

Next week...

I'm looking for some smaller beaten down companies that are lagging the overall move we've had. You'll notice that as you go deeper into a bullish move it lifts all boats. That's been a very strong trend for years, since at least when I started doing this and I am sure before that. A rising market lifts all stocks, even the crappy ones. The question is, how high do we go in this move. I still think there's a decent shot we see 10,300 on this move. I'm making money from the long side for now, but again looking for entries longer term for shorts. The fear is always that you'll miss a move one way or another, part of good trading is not worrying about moves you miss, just concentrate on the ones in front of you. This week also watch the reaction to the disappointments regarding Black Friday. The bulls will argue its priced in, the bears will rightfully so say thats absurd since we aren't coming out of this for at least 3 to 5 years. The question is, NEAR TERM what does the market do. Right now its telling us that it feels that Obama is going to save the world and that we'll be out of this in a jiff! While I feel that is completely and utterly wrong and idiotic, I try not to fight the market, I try to be zen and go with it, and I suggest you try to do the same. So, while I remain FIRMLY in the DOW below 5000 in 2009 camp, I am hoping we get a further push to the top end of my range as I believe it will provide easy entries to the downside then.
The concern for me is that there is increasing unrest civily around the globe. New Zealand, Iceland and even China have had issues with this. What happens when people here realize that they really are on the hook for all the money the government has basically, in my opinion, thrown into the wishing well. How in the world they can justify what they just did with Citibank is scary. We are now at roughly 6 TRILLION the taxpayer is on the hook for, without real representation and with no end in sight. While we may or may not get a tax raise in the next year or two, and in fact they may cut taxes, its all PHONEY MONEY. It just devalues the dollar and when people realize that their money has been stolen from them by the Fed, I am freightened to think what is going to happen potentially to the fiber of our nation. They are stealing money from the poor to prop up the rich who already died. Citibank is worth negative $350 BIL, why would you save it? It's too big to fail? That's the biggest lie we now have. I'd take my chances, let it fail, let GM fail, let AIG fail, let GS in particular fail, let them all fail. This misplaced fear that the entire system will fold is BS at best, and a blatant disasterous lie at worst. I opt for the latter given the choice. What's mind boggling is that the Fed is trying to recreate EXACTLY what it was that got us into the mess! And, they are repeating Japan's mistakes from which they still haven't recovered. Citibank will go under, so will GM, so will AIG, so will 1/2 the big banks out there, and many insurers. All we are doing is delaying the inevitable. I suggest you listen to the people who are negative on what the government is doing. You may or may not agree, but I've found over the years that naysayers (not conspiracy theorists who are just nutty often times) are the smartest and most right group. Buy side analysts have a conflct of interest, its like listening to the guy from Pimco say that the government is doing all the right things. Of course he feels that way, it helps him directly what they are doing. Reality, I find, is unbiased, and that's where I try to skew. We are facing potentially the biggest crisis we've ever known, and that includes the "Great" Depression. I am looking for some suggestions from YOU guys and gals, send me an email if you have any ideas as far as protecting yourself in a Depression. Some people like Gold, some people like real estate, some think the dollar will be best. If you have any real, educated ideas, let me know. I think that we'll need some hard answers as we move forward through this mess. It's just unfortunate that we have a government right now that is intent on laying the burden on we the taxpayer and that is going to have potentially disasterous consequences. If they would let some of these companies fail they would have a lot more gun powder to rebuild. Now, I fear, we are shooting our load and in so doing we are condemning the collective us to something far far worse then "too big to fail".

Watch the market reaction early this week. If we can't shrug off the bad news we may be headed back down near term. If we can bounce then we have another leg up. I'm still loving the financials SHORT, but this move needs to play itself out. When it does, whether it be this week, or mid-January/February this market is going to see depths that will shock people and ruin 100,000s of people's retirement. I wish they would all take this move higher here to take ALL these money out of the market, but unfortunately my voice is pretty limited and too many people have been doped into thinking that if they hold for 10 years it'll be fine. Really? Japan's markets are down 80% from their peak in the 1990s. 80% and it's 18 years later! That logic didn't work there and its unlikely to work here. I repeat, GET OUT if you have money in the market - GET OUT, before its too late. We may get a further bump, get out while you can is my opinion, take it for what it's worth!



Wednesday, November 26, 2008

HAPPY THANKSGIVING, boy do we have a LOT to be thankful for!

Wishing you all a Happy Thanksgiving to you and yours! Please be safe and enjoy the holiday!

We picked a pretty dang good time to cover our shorts and go long some stuff! That's what I call TIMING!

Very thankful that you guys are here to listen to my rants, or at least put up with them, and to give the (mostly) positive feedback! I look forward to continuing our path to riches next week! The market is now overbought, but I'm thinking 9000 may be a straight shot. We'll get a blow off top next week and then some backing and filling until we head to the January Effects list that is coming soon! Hopefully we get the pullback to make that play even better than I think it'll be. We'll see soon enough. I got a couple emails today asking if I was going to short some stuff here. NO, not ready to do that just yet. Like I said the other day, what I want to do is put together a list of stocks you want to short when the time comes. I would LOVE us to hit the top end of my Waxie range of 10,300 on the DOW, which I think is probably about as high as we could possibly go without some huge news. Even then I doubt we go higher than that, but in this market who knows, I mean we go up 250 today and its nothing. As far as today goes, I have to say, I made nice money, BUT I messed up. That terrorist news out of India threw me off. Normally I wouldn't trade off it because unfortunately they seem so used to it there that the market usually shrugs it off, but since this am there was a rumor of bombs in NYC over the holidays, plus that, I over thought the situation and took off all my longs, of which I had a lot, took the profits and compounded the damage by going short. I stopped out but not before giving back a lot of my earlier gains, and probably worst of all, I was SO sure we would do this today, I told you guys yesterday that is the big time trend for today. What can ya do? You see, I am certainly not perfect, I make mistakes and outthink myself sometimes as well. Is it that important? Nope, I pray for the people who were affected by the tragedy, and their families. We are celebrating Thanksgiving tomorrow, they will be attending funerals for no good reason. We all have a lot to be thankful for, we live in a beautiful country and we have a chance to make a very good living doing something as inucuous as trading! I'm very grateful for my life, my kids, my family and you guys and gals! I hope that the tragedy in India is contained, one of the reasons I traded off it was that this attack seems to be particularly vicious and deeper than others. Hopefully I just made a very bad decision trading wise and it's nothing more. My prayers regardless. It's very sad that humans have such a propensity to destroy each other. Thing is, not sure how I can complain, I made a mistake and still made over $50,000 on the day. That's not too shabby. Best wishes to you all! Make sure you sign up for the WORLD SERIES OF TRADING (! Enjoy! RULE! Michael "Waxie" Parness

is ACTIVE. COuple clients wrote me saying they couldn't sign up.

you can go to;

scroll down, there is a LARGE tab that says SIGN UP

Go for it! It's rockin!


Tuesday, November 25, 2008

How the market can go up and make me wrong!

OK, so you all know I'm on record as calling DOW 4500 to start and potentially 2500 after that. I am beyond sure of the 4500 prediction, and think 2500 is possible. Having said that, I wanted to look at ways in which I could be wrong, potentially.

So, here goes;

1)The Fed continues printing money wantonly, thus rendering the value of the dollar 50 to 80% less than where it currently is. Bernanke is on record as saying that if he was faced with DEflation, which is where we currently are, he would start printing money. The theory being that printing money would basically "level" the deflation by doing something inflationary (printing money is most certainly inflationary). Germany, and others, have tried this in the past (does anyone remember one definate reason why Nazi Germany was born?) and it's never succeeded. Frankly, I don't think it can succeed, BUT what it can do is give the illusion of wealth. Unfortunately this is why I rage against the machine, because its pretty safe to say that while prices of homes, and even the stock market could "stabilize" its illusionary and in fact the opposite.

Today the Fed basically printed another $800 BIL. I've lost track, but I think we're basically around 2 TRILLION at this point. By the time all the banks have been saved, because don't you know that they ALL are "too big to fail" and look what happened when LEH failed!? I think we'll be north of 25 TRILLION. Yes, you read correctly, that's 25 TRILLION with a T!

If I am even 1/2 right the value of the US dollar could potentially fall 50% or more, and the US would probably be downgraded ratings wise, making it even harder to sell treasuries and setting up a potential default, which could, in worst case (or one worst case) make us for all intents and purposes - BANKRUPT.

Is that likely to happen? No, it's not, but it could.

So, for those that have asked how I think the market could prove me wrong, there you have it! If they devalue the dollar by 50% or more, then yeah, its possible (though I still think it sees south of 5000 no matter what) that the DOW would go UP. If the dollar was devalued by 50% and the DOW went up 15% then its net would be near the 4500 level if my math serves. Home prices same deal.

2)There is no #2, sorry. In my opinion the only way the US markets are not going below 5000 and potentially to 2500.

That's my happy little tail.

And, I want to reiterate, I am just a dude with an opinion,and you know what they say "opinions are like "A-holes" everybody has one!"

Mine just happens to be stated a bit strong at times. It's only cause I care deeply about the direction of the country and I'm very concerned about what is going on right now. I want to give Obama the benefit of the doubt, but I must say that I am very disappointed with his appointment of Tim Guitner. One of President Elect Obama's promise was CHANGE and a different direction, and yet possibly the most important appointment he will make early on (at least so far) he picks someone who is "old school" and who has presided over NY Fed since 2003. What good economically has happened from 2003 to now, besides one big huge BUBBLE?!

I'll leave it at that.

I'll also say something I kinda have said before (stay with me, I am slow on the uptake, so I repeat myself at times. I repeat myself at times. I...) The Fed is harping on consumers spending money as the way out of this mess. So, instead of having people FINALLY freakin' save money, they want banks to loan money at big interest rates and put more and more people into debt? Isn't that a large part of what's going on? Why are we not learning from our mistakes as a nation? It's infuriating and it's frustrating and sad. People are finally saving. OK, so we all suffer a little for a couple of years, maybe 3 or 4 even, but we come out STRONGER. What exactly is wrong with people solidifying their financial positions? Why the rush to get out of this immediately? We are a nation of fast food, and instant gratification, when we need to learn PATIENCE and all take a deep breath. I wish the Fed and our leaders would learn some spiritual principles and some economic sense. I believe that what they are doing is leading us on a path to disaster. I believe that there should be a 3 month moratorium on taking any kind of major action, other than to patch the damn dam if need be very short term. $800 BIL, $300 BIL, $700 BIL, $50 BIL, I just don't get where it stops. Do people realize that this is going to have to be paid for or YOUR net worth will be a lot less than it is now? So, while no one wants to raise taxes, let me ask you something, what's the difference? If they devalue the dollar by 50%, but lower taxes, does that feel good? Are we that dumb? I sure hope not, because thats what very well may and I believe will happen.

Perhaps someone will stand up and say JUST STOP! Guess ya never know, but I do know that hiring a NY Fed guy who is buddies with Hank Paulson is unlikely to yield very good results. Very sad indeed. DOW sees 4500 no matter what, you have it in writing, I hope I'm wrong!


Michael "WAXIE" Parness

*Oh, and to all of you - HAPPY THANKSGIVING! Please be safe and enjoy your families and loved ones! I am grateful to you all, and to all a good night!


Come check it out and sign up at - - and play for FREE to win CASH and PRIZES each week! PLUS, win and qualify to potentially be invited to compete LIVE with other traders for the first WORLD SERIES OF TRADING!!! It's FREE to sign up, FREE to play and see if you can RULE THE FREAKIN' MARKETS and become a WORLD CHAMPION! Michael "Waxie" Parness

A dangerous game...

Eh, pretty nothing choppy and sloppy day, market trying to go higher on Fed, but stalled out and had a decent move down which we caught. Then we bounced and finished the day higher, but basically middle of the days range. Just a sloppy day all around. I'm loving trading these ETFs, they are insanely juiced, they are like stocks on steroids! SRS, SKF, FAZ (maniac), I mean you're trading with basically 12 to 1 leverage with FAZ, that's kinda insane, one has to be careful and set real solid stops, these things fly all over the place. Wheeeee! I still think we have some more upside into year end, but we'll see. It's kinda scary, the government is just throwing the kitchen sink at the markets. I just don't get what they are trying to do, none of this is going to work longer term in my humble opinion, it will backfire. You can't just destroy your currency to make it appear that things are better. It's kinda like doing a 1 for 10 stock split, over 80% of the time it seems that stocks that split 1 for 10 end up back down to the 1 spot in the end anyway. You can dress a monkey up as a giraff and feed him some bananas, but in the end he's still a monkey! What's even more scary is that they announced today that they contemplated buying C stock on the open market basically to squeeze the stock and punish the short sellers. THAT IS SO INSANE it's beyond belief. I really am starting to wonder if we live in a democracy or in a state run communist state at this point. I understand people want the markets to go up, but forcing them to simply won't and can't work. The market needs to make organic adjustments. C on the open market? So it squeezes to $25? Then what? It'll end up back down at $2 at some point anyway more than likely, so all you do is crush investors who hop on board thinking that they have the all clear signal now. And, herein lies the larger problem that should come into play after Obama is sworn in. This market only rallies on government intervention, its phoney, it's being propped up, what happens when its not being propped up? Is the government going to buy out the whole entire market? Buying stock on the open market is not capitalism, its nationalizing institutions and market manipulation in a blatant attempt to dictate market direction. Now, you could chide me if I was short, but as I said, I went flat and if anything LONG lately, so I've been doing QUITE well, thank you very much! BUT, that doesn't change the fact that the government is supposed to oversee and regulate (if that) and not dicate market direction. C would have squeezed to $20s if they did that. Is C worth $20s? Of course not, its barely $6 even after they did what they did! A free market system has to be careful not to step over the line nad that line, unfortunately, is being run over by a mack truck at this point! We own it and I've been working on developing something that I can be excited about for a while, I think we're finally ready! So, sign up and get a piece of my money with NO risk and NO cost! It's free to sign up and free to play and you can win some CASH and prizes AND qualify for the LIVE - WORLD SERIES OF TRADING!!! RULE! Waxie

Monday, November 24, 2008


This is a good time for you guys and gals to start making lists of stocks that you felt like you missed them on the short side the 1st and 2nd and 3rd go around. I think we will be looking to reshort in the not too distant future, for a trade, and then again after another bounce probably end of Januaryish. That's obviously subject to change, but what I try to do in times like this is look for stocks that are having a counter-trend move so I can re-hop on board to catch the bigger fall, assuming I'm right. The great thing about the markets are they are tradeable forever if you learn to earn using our strategies. Timing is everything. Today I had another GREAT day, one of my best in years, and I've been saying that a lot lately! I LOVE this market, I can't say that enough times. This market is psychotic and we LOVE that. One day up 500, next day down 500, next day up again 500. I mean, how can you not trade this market? I've never seen anything like it, in a lot of ways its a better trading market then even 1999 and 2000! THAT says a TON about how many great opportunities we have day in and day out. You should be taking advantage whilst it lasts!
In the meantime, I want to say thank you all for your testimonials, we've been flooded lately and it means a lot to us at to get them. I find it very gratifying knowing that we're helping people make some of their dreams come true. It's hard out "there" for most of us, and trading is a way to at least develop your own business during a time when no one's job is safe seemingly. As we head into the new year we will be offering several new initiatives that I'll be discussing here in the coming days. #1 on the list is the JANUARY EFFECTS list. I think this year is gonna be awesome for that. #2 is that we are close to launching a MAJOR initiative that I'm very excited about and I will discuss in details by weeks end. It's TOP SECRET, and I think it'll lift us to a whole new level. The new infomercial should debut in February and it's gonna be kick butt! Thank you all for your loyalty, and as we approach Thanksgiving please be safe, healthy and make sure you make enough to pay for not just the Turkey, but the stuffing as well!


Man o man, I just don't know how we could be any more ON FIRE or EN FUEGO! Wowsa! Guess my call was pretty good, no?
OK, so enough gloating for the day, it's kinda scary how much moolah I'm making lately, but I'm supersticious so let's just knock on wood for now, ya know?! Wowsa is all I'll say, seems like every day I'm making enough to pay my salary for the year! Dangggggg! I LOVE THIS MARKET! OK, so you know I'm gonna talk about the C bailout for a second, if nothing else. Yes, it's DISGUSTING. The government continues to just take tax payer money and bail out these DEAD businesses. What's best is, I'm just a DUDE and CNBC Charlie Gasperino all last week kept telling veiwers that C has a GREAT balance sheet! How could I know that C was WORTHLESS before today and had the $350 BIL in bad debt I've said they do for MONTHS and these clowns not know? They pay these carnival clowns money to report and yet they continue to feed the public misinformation after misinformation. Remember Booyah's call that BSC would be bought out? It was, of course, only problem was he said it when BSC was high $60s and it got taken UNDER at $2 then $10! He loved WB, he loved C. I mean these people are walking MONEY LOSING MACHINES and yet they get paid and with booyah they promote him like he knows ANYTHING, or hasn't cost his viewers probably MILLIONS UPON MILLIONS with these horrid and misinformed ideas. Didn't he call C, WB, WFC and JPM his Fortress Four? Something like that, right? With a fortress like that give me a windowed apartment in the eye of a hurricane and I'll take my chances! OK, so now Casper(the friendly ghost)ino says that the government is going to make money on the C debt. Huh? Haven't we learned yet that these debts are WORTHLESS? Yeah, its a great deal, they are going to rack up! Ah huh, sure they will. It is now clear that the government is intent on recreating Germany before WW 2, and a host of other failed systems where they devalue the dollar into nothingness. They will print money and create the ILLUSION that things are ok. So, if they devalue the dollar by 50% and then the housing market drops 30% then they can say "look, we stabilized the market!" It's a total LIE, and its treating people as though they are completely naive.
Look, I know some of what I say here is very inflamatory, sometimes I feel like I should just keep my mouth shut like a good boy and wave an American flag and say "yes, we can!" But, I've been around the block and I've dealt with beaurocracy, so I just don't keep my mouth shut. I really am just a dude, I don't profess to know a lot about certain things, I'm not an economic genius, but I do know when the wool is being pulled over my eyes. And, I do know that so far the taxpayers WILL be on the hook for the following, right now no one says a word because they don't realize that we will ALL be affected by this lunacy. I half expect them to say they are nationalizing the entire stock market, paying 50% more than current values and that we'll make a mint on it!

BSC $30 bil
AIG $200+ bil going up to $500 bil from what I've read
C $300+ bil
Stimulus package $70 BIL
Bailout package $700 BIL

I mean, what the hell are they doing? They have no clue and they are just swimming against the tide. So, the market is rallying on the false hope, again, that the Fed will save it! It's good, I was long all day today and we made HUGE. Let's get this party started and get us to DOW 10,300! That's the peak on any move but thats still 2000 points away and would be awesome! You gotta love it, they are creating another bubble, but this one is likely to be far worse in the end and will likely keep us in a DEPRESSION for far longer. Devaluing the dollar is not a good idea, it is doomed to failure. We should fade the #s tomorrow, which will be bad and then from there chop around more than likely. We'll see soon enough, but so far we are pretty much owning this beast of a market and I intend to keep doing so for a while! Rule! Waxie

Sunday, November 23, 2008

A message to members...

Dear Trend Fund friend,
Just wanted to drop you all a line as my overall bias has been changed
to NEUTRAL. While I am still firmly bearish intermediate and long term,
and stick with my call of DOW under 5000, there is a clear market
indication that Obama is being viewed as some sort of panacea to all
that ails the country. That's a lot of pressure to put on one guy, and
unfortunately overly optimistic and Unrealistic more than likely.
As always I preface that statement by saying I hope I'm wrong. I would
love the economy to be repaired in short order and for us to go be able
to say "all hail Obama", but as good or not-so-good as the new President
is or will become, he's just a dude and the problems we face as a nation
are not going to be cured overnight, and probably not over a year or two
or even three.
I also think that Obama isn't that interested in saving the stock
market, so its really false and misplaced hope to rally us into his
inauguration, BUT we definitely rally into anything the guy does and
this is a market that really wants to believe it can go up, despite the
reality of the situation it and we all face.
So, while I think there is a shot the DOW sees under 5000 by January
1st, and I remain FIRMLY in bear camp, I do not feel that being heavily
shorted here is justified based on market action.
And, I do believe that we are going to get one helluva JANUARY EFFECTS
this year, which we will be sending everyone an email on to sign up
(this is one year you should ALL sign up for it, I think it's gonna be
one of the BEST ever, its the perfect storm of making this most powerful
trend a potential Gold Mine!
The fact is, if we are to assume that the bottom is NOT in, which I do
1000% assume, then getting a nice rally would be awesome and give us a
brilliant setup for huge money making opportunities BOTH ways!
I am still not ready to buy and swing much on the long side. I would
rather trade the long side intraday, BUT I am willing to consider a
couple of call positions now, which is something I wasn't willing to do
before now. We've been short this entire move down and we've reaped
HUGE profits! I've gotten more testimonials in the last 3 months then
we've had in the last 3 years! People are racking up BIG TIME with our
Options Trader service and in our Chat room.
Sign up for Options Trader at:
It's hard as a trader to sometimes take off positions that you feel are
ultimately going to go further your way, but risk/reward is everything.
I believe GS will see under $25, and it very well may do so near term,
but we've had it short since $140s and that means we're up $90ish on it
if held to the $50 target I gave it months ago.
Also, we can still trade these stocks to the short side on breaks
below lows/supports and still get, in most cases, the majority of the
move without the inherent risk of tying up your money, and of a big
And, if we do sell off further, that's fine as well, just means the
January Effects list we give has an even better shot of returning HUGE
gains, as its done in the past and if I'm right this should be one of
the best years on record of a January Effects list move! No one does
Trends better than us, and we look poised to get a doosey here soon!
I am now market neutral near term, with an overall bearish/lower
outlook longer term. That is subject to change at any moment, that's
the nature of being a trader, but the lower we go the more risk there is
to the downside movement. GS short at $140 and GS short at $50 longer
term will still be profitable I believe, but we've already locked in
HUGE gains, why press it?
Get ready for the JANUARY EFFECTS and our STOCKING STUFFER annual offers
coming soon! Look for them in your mailbox in the next week or 2.
We'll be offering classes and a list of what we believe will be HUGE
opportunities coming shortly for your holiday season!
RULE and let's rock this week and into year end!
*And, if you haven't signed up for the HOTTEST service on earth, I
suggest you give it a try NOW - OPTIONS TRADER service has been ON FIRE,
posting 100, 200,500,1000+ winners all over the place! That's no
exaggeration, we are truly rocking! My personal acct is up well over
500% and over $1,000,000 in the last 3 months. How's that compared to
how the market or most anyone is doing in this market? Ka-chingo baby,
*Much of the profit I've had has come from OPTIONS TRADER picks! I
suggest you sign up NOW!
Sign up for Options Trader at:
Prior or current members wanting to sign up for Options Trader or
Ninja Trader should email
Michael "Waxie" Parness
P.S. If you need help signing up, you can email me directly at

Saturday, November 22, 2008

I AM COMPLETELY FLAT, I took ALL my shorts off...

While I continue to be VERY strong on DOW below 5000 and potentially going as low (or lower) than 2500, I think the risk/reward ration here has switched to neutral. In fact, I think there's a good shot we get a very nice bounce in commodities in particular. Watch oil, corn, etc. for a higher move short term, probably this week. The short side is now overcrowded on commodities and again, the risk/reward is neutral at best, and bullish worst case for Bears. I'm looking to reshort some stocks two ways, either on a breakdown of Friday's lows here early this week, or on a nice rally into resistence. We are going to be promoting a bunch of stuff here the next week or two. Please keep an eye out for details to follow shorty. Early this week is key here, if we can't hold 7500 we may see 5000 by January 1st. We shall see! That's a long long LONG way off! RULE! Waxie

Thursday, November 20, 2008


OK, I had to comment on his STUPID 8 point plan. My gawd, the guy is always wrong, and keeps spewing nonsense as though its reality. If we did the things he keeps saying we should it would completely bankrupt us. COMPLETELY BANKRUPT THE UNITED STATES OF AMERICA! Don't think it can happen? You're wrong. It WILL happen unless the government ceases and desists from the approach they have embarked on. The notion that more intervention is going to save us is ludicrous. The more they do, the lower the market goes, and the worse the economy has gotten. Advocating more of the same on steriods will crush the economy even further and the markets. What people don't get is that the market is still VASTLY OVERPRICED! You can not artificially pump up the market and hold it up. Any plan will do nothing but incite stupid squeeze rallies that eventually get sold into. It will allow the RICH to get richer. Don't think so? Again, I repeat, where did the $25 BIL that WE gave Citibank go already? They gave it to them what, like 2 weeks ago. Where is it? So, Booyah the knucklehead wants to give out TRILLIONS and that's the answer? Unreal. It's amazing that CNBC makes this guy some type of hero, when he's a JOKE, a total JOKE. I don't have an 8 point plan, I'm clearly not that smart, I don't know how to RUIN the United States, sorry. I know, I'm getting loopy, but you would to if you had to listen to these knuckleheads for 8 hours a day, 5 days a week! My gawd, its horribleeeee! Hehe. Futures are WAY up here overnight, should be an interesting day Friday. I said we'd hit 7500 and we did, from here? Not sure, folks, not sure. We should get a decent bounce soon, probably news driven, but again, just not sure we can go very far. I guess with the right news we could go 1000 to 1500 pts which is obviously a huge move, but ultimately we've been getting typical bear market rallies where we'd get all the gains in a few days or a week and then roll back over. We're simply not going to get back to S & P 1200, I'm sorry, as much as I would love us to. But, I could be wrong, it does happen and I hope I am! The higher we go, the better. It's ok, we got out of most of our puts and shorts Thursday, so rally away, baby, rally away! I hope they get GS back to $75, that'd be a free money short in my view. It's gonna be hard to get any real lasting rally for a LONG time. So, I stick to the plan, which is to continue to short rallies and trade bounces. BOoyah, baby, booyah! Friday should be VERY interesting and VERY volatile. GOod trading model would be a nice gap up, fade it, go red, get margin calls and then get end of day rally heavy. We'll see soon enough! DOW futures (YM) are up 160s pts as I write this on no news. Gawd bless! hehe! Booyah must be calling another bottom! RULE!

Listen up, folks...

This market is on life support. The lies being thrown at the American public are unfolding and the more they are, the lower this market has to go. Today after the close Citi (C) said that they are looking to sell themselves, or break themselves up and sell pieces. Do you know the last few companies that said the same thing before they went to ZERO (or close to it)? WB, WM, BSC, LEH, AIG. C sees under $1, I've said it for a very long time. Unfortunately I'm right. Right before C are, I believe, BAC, MER, MS, and my favorite GS, which is still absurdly overvalued. When GS is under $10, which I believe it will be, you can thank me. Those are a few, there are a TON more. Pundits continue to send their clients to market HELL with reckless abandon. The denial is thick, and it's only unfortunately going to get worse. Nothing goes in a straight line, but I am now officially moving my DOW target to a MINIMUM of 2500. I am quite sure we see my initial 4500 target, but I think we see a lot lower. We are in very serious trouble, folks and the more denial that runs rampant, the worse it'll be in the end. We will bounce shortly, but its unlikely to last very long. This market is in a hospice, it'll pop up and look like its doing better once in a while, only to then fall even lower. I'm sorry, I really am, but anyone who owns a SINGLE SHARE of stock is a SUCKER in my opinion. I think there's a good chance that we start to see some states go bankrupt, and for the US to be downgraded ratings wise. If China decides they need to stop buying our paper it's going to get a lot uglier. If they decide to call the debt, forget it, its over, the fat lady has sung and stick a fork in the US stock market for good. People ask, "but aren't the companies worth something?" The simple answer is - YES, and many are worth a LOT, there may even start to be some "values" simply because they are trading below their cash levels and making money (at least for now). BUT, there are so many companies that are debt laden and that is the biggest issue. For example, many of the energy names have huge debt obligations. When they can't meet them they have to try to borrow more money at a higher rate. If no one will lend them at a higher rate even they have to go bankrupt. Look at stocks like CHK, they carry huge debt loads in a declining market, the stock will probably go under or sink below $10 more than likely. Just because its "cheap" doesn't mean it's buyable. Today was a tough trading day only because the GM news threw everything off. I got stopped out of a bunch of my shorts only to have us close at HOD. I still made very nice money, but have to admit I had one of those "I shoulda made more" days! It happens to even me, trust me! I don't know about anyone else, but I just don't get why Hank Paulson has a job at this point. Seriously, why is this guy the one running the show? He's clearly clueless, he's lied about many things and gone back on other promises. He keeps saying we're going to make money on these "loans" yet we just gave C $25 BIL of OUR money and C market cap is now $25 BIL and when its under $1 where did our money go? Seriously, where did the money WE just gave C - GO! Damn it! It's infuriating. We're handing out free money to these companies that are on the verge of bankruptcy and no one says a damn word! It's very sick. This GM thing is sick as well, and gets sicker by the minute. Why don't these "leaders" see the folly of bailing out companies that will cost us $100 to $500 BIL by the time its done? How is that representation? Who's interests besides the lobbyists are they serving? If the Unions think GM is a viable going concern, why don't they take their pension money and THEY fund the $25 BIL themselves? Since GM is such a great company and will be fine a few years from now, then the Unions shouldn't have any problem funding the bailout. Right? Total nonsense and totally lying. I'm sick of being lied to, sick of it. Tell the freakin' truth! Tell us reality and not some pipe BS dream! Best is that GM stock rallied on the news, as though the stock will have any value more than likely once they get a bailout. I doubt it, GM has to go to zero as far as I can see. There has to be some type of oversight and yet there isn''t. No one truly steps up and says this is how its going to be. Tell the unions they have to compromise and give back some things they got agreements for many years ago. If GM goes under they get nothing, so make a deal that benefits everyone. But, no, all we get are LIES. I gave you guys some stocks to short today, how'd FSLR and VNO and others do? I'll give you another one that I LOVE short longer term - AMED. I think this thing is trading like it wants SINGLE DIGITS. We'll see, and it could squeeze when we bounce, but the way its trading and traded today, I think it sees $8 or less now. I called it short initially from $54ish and said it would see $25, I am moving the downside target to $8 now. We'll see soon enough! TOmorrow is options expiration, make sure you manage your trades and don't get stuck with something you don't want to own. We are ROCKING and people are making BOATLOADS, I am getting a TON of testimonials, keep them coming! Right now I am concerned that the US is headed toward bankruptcy and politicians have their heads in the sand, at best. RULE! Waxie

Wednesday, November 19, 2008

OK, I've decided to be humble, folks...

I could say that I've called this completely, I could say that GS was gonna hit $50 (new target is $25) and its there, I could say that I've been BEGGING every one of you to SIGN UP FOR OPTION TRADER because you would be up HUGE, like SICK money, like people are PRINTING MONEY! I could say that 4500 is a lock, but I can't really say that even though I believe it cause that's not a fact. The rest? THE REST ARE FACTS! I'll tell you this, it would be nice for the naysayers who sent me those very nasty emails saying I was nuts or worse, if you guys (or gals) would be menches and menchesses enough to send me a NICE email saying something nice. It's ok, though, I don't need it. Having said all this, I'm sorry that I have beent his right, this fast. I know I seem like I'm gloating, and I guess I am on some level, but it is true that I would rather we go up then down (of course, I'd like to be long when we finally do!). But, as I've said many times before, the only way to make money trading is by being a REALIST! If you aren't willing to look at reality, if you go on TV and keep saying to people that the bottom is in, that this is the "buy of a lifetime" if you keep saying very wrong and very foolish and frankly VERY destructive things to people to get them to step in front of a train that has BARELY started to do what I believe it'll ultimately do, then I'm sorry, WE have to make money. This is my livlihood and I will protect my clients to NO END, period, end of story. Today we made SICK MONEY. I had my second best day in I think at least 5 years. I've told you guys for a LONG LONG time that C was toast, that FNM was toast, that FRE was toast, that GS was toast, that FSLR was/is toast (going to $20s I believe), that APPL, GOOG, RIMM all toast. Those of you who have been clients on any level know that we are beyond rocking. I am getting testimonials EVERY DAY from people who are truly ROCKING and making insane money. I'm telling YOU to get in the game, folks. Stop sitting on the sidelines and get with the program! Now, as far as the market goes, it'll be interesting here. I think we have a decent shot to see 7500 on the DOW by Friday. We are right at 8000 obviously, so we will either hold this level and attempt a decent size bounce and may get back to 8500, or break down and go to 7500. Best thing that can happen to the market is a GAP DOWN tomorrow, a BIG GAP DOWN and get some margin calls and then a high volume selloff, even better if we get that and hit 7500 which should act as MAJOR support here near term. That'll get broken eventually, but even I would be covering all my shorts and even trying to catch a bounce. BUT, until we get that type of high volume capitulatory move, we are in no man's land. Even if we do bounce it's unlikely to last long. If you took our BEAR HUNTING class you know why, markets that are driven by NEWS and HOPE and PRAYER always go DOWN A LOT in the end. Investors keep waiting for the Fed to save them, so everytime the Fed says something they buy thinking that its all going to be ok, this is just foolish and it is CRUSHING so many people it's scary. I am sorry about that, but this is a market and if you are smart then you are playing it BOTH ways, if you are foolish then you will keep buying every time there is some absurd news and think that the "bottom" is in. I am sure tomorrow they will trek out the same ridiculous cast of characters on CNBC who will say they are ALL IN in the market and that they believe that in the long run it'll pay off. I am telling you in no uncertain terms that I believe we will now head to 2500 on the DOW and roughly 450 or lower on the Nasdaq. Those of you who said I was nuts for saying GOOG $150, and GS $75, let alone $50, and C $5 and etc, etc,etc,etc. I say to you, open your mind, take a deep breath and look a REALITY. Reality is we are in very VERY bad shape, the best thing you can do is to go with the market, not against it. Look at GS today. We were down early and they were still buying it! I mean, it was UP. After hours here it's up like .40 cents. I mean, its $55 and people think its cheap? Why? GS has NO BUSINESS! They are BROKEN, folks. BROKEN. And, people just refuse to look at reality. They say "Oh, Warren Buffet bought them" when that's NOT what he did. In a Bear market you look for places to RESHORT and places to COVER, you don't look for places to BUY, that is a losing strategy! LOSING. This Bear market is not over, not even remotely so. Try to go long for more than a trade at your own risk. You will be VERY VERY sorry I believe, and I've been DEAD on. THAT is reality, isn't it? OK, now before I go to meet all the other parents from my 7 year olds class (many are in the biz and need help, hehe!), I want to comment on the GM hearings. If it isn't clear from today that they should NOT bail out these companies, I don't know what it will take. They will more than likely, and its stupid and unfortunate and it's sad that the vast majority of Americans are going to suffer for the moves that CLEARLY aren't and won't work that our government continues to make. I just don't understand, these people are supposed to represent their constituency. Who in the world wants to do this bailout who isn't in that industry? And, I am VERY sympathetic to everyone suffering, trust me, but we have had a very successful free market system for over 2 centuries, now we want to throw it away because of lobbyists? I like a couple of the senators who really went after them and brought up some very good points for once. Why is the government picking one industry over another? It's a serious question and it has serious implications, folks. You may or may not think it affects you, but it 100% will and does. The government should not be saying "oh, we can't let GM and Ford fail, it'll be a disaster!" So, what happens when they ultimately fail no matter what, which they will, and all these other industries fail, which they can and will? Is the government prepared to bankroll not just 1.5 MIL jobs (which is a lie anyway since if they went into bankruptcy it would be a job loss but not nearly that many, probably less than 1/2 that amount is my guess), but are they prepared to bankroll let's say 10 to 15 MILLION jobs that I think are going to be lost? These constant half measured attempts to do some good are doomed to fail, they are making things WORSE, not better! The 700 BIL was supposed to stabilize markets and yet we've lost over $2.5 TRIL in market value since they passed it. And, what's scary is that CNBC every day says "we don't get it, TARP should work!" Yeah? Maybe if you thought about it you would realize that the market is pricing in the cost of NATIONALIZATION! C is $6s because they have at least 300 BIL in bad debt that will probably default and no backstop that can work and for the govt to bail them out means the govt will have to take them over! C stock is WORTHLESS, and THAT is why its at $6 and going to probably ZERO without some news that is real and meaningful. C goes to ZERO, mark it down, its still a short and people continue to try to step in front of these trains. It's not working and will not work! The worst thing that people can do here is keep trying to pick a bottom, and it will be much worse if the government continues to try to manipulate the markets. The governments job is not to do what it's doing. Call me unpatriotic, I'm not. I care deeply about what's going on, it makes me ill that I watch these LIARS go on TV and LIE. Did you hear Rick Waggoner say today that "we have a GREAT management team, and I wouldn't change anything" basically. How in the world can he say that? Great management team? Can you imagine if GM had bad management then! ROFLMAO! OH MY GAWD! PLEASE SOMEONE HELP USSSS! Until there is HONESTY, and until there is REALITY this market can not get a real lasting bounce and anyone looking for it is just very foolish. I know I am rambling, but how about that Warren Buffet call to buy American? When does Warren get a margin call? This notion that its patriotic to buy "American" is dying a very horrible death. It's simply not true. American is FREE MARKETS, and it's letting the government do it's job, which is not to keep putting taxpayer money at risk, with NO SHOT of repayment! I love today that they were saying that GM will get a LOAN! ROFLMAO! That's like me lending the homeless guy on the corner $100 and expecting him or her to give it back to me. ANY money that goes to these companies is NOT ever coming back! How about that money we were all going to make on AIG? Or, the $10 BIL we already gave C, or GS, or MS? Where and when is it? Does anyone think we are going to get the $150 BIL back that we're out on AIG? I mean, be real already. YOU need to live in REALITY. As I've said many times before - HOPE is a 4 letter word, folks. The market isn't going up in ten years, or 20 years, sorry. We will see 2500 before we see 12,000 again, mark it down. And, as I will continue to say...I HOPE I'm wrong! :) RULEEEE! Oh, you want two shorts? FSLR and BLK, much pain to come I believe, still a lot of downside on these two in my opinion. We'll see, we shall see! FSLR target is $20s and BLK target is $50 or lower. RULEEEEE!!!!! How'd ya like the SPG short call, or the VNO short call, or the BLK short call today my dear and wonderful clients? WE ARE ROCKINGGGGGGG! RULEEEE!!!! Michael "Waxie" Parness *SIGN UP FOR OPTION TRADER!!! NOW!

Tuesday, November 18, 2008

My gawd, how much of my money is this nutty government spending tomorrow?

I feel like every day they just make another crazy deal to spend my money without consulting me (or anyone)!

What's hilarious to me is that the car makers have taken out PAID ADS to tell everyone that they can't be allowed to fail, it'll be a catastrpophe! OK, so first off I think that's absurd, Chicken LIttle is envious of such rubbish.

Secondly, if they are so worried about their finances, WT-FREAK are they doing PAYING for ads to tell us about it! Are you kidding me with this? So, not only are we the taxpayer going to be on the hook for another bailout that can't possibly work (I can't wait for them to tell us that GM is going to make us all money in the end!), but we're also paying for the ads to tell us that we need to do it for our own good! ROFLMAO! Now that would be beyond funny if it wasn't so tragic. Does ANYONE in our government give a freakin' damn about the majority of folks in this country who didnt' do anything to qualify for a bailout? Think about this, let's say you are struggling to get by in your own right, you make $20,000 to $120,000 and to make ends meet and in the $20,000 instance to EAT, and you're going to be on the hook to pay pensions and health care for someone else? Or, you can't pay your rent but you should be responsible to help try to keep someone in their home? What in tarnation is going on? I feel like we're in the twilight zone and Rod Sterling is going to show up in Congress to testify. These people are SO clueless its absurd. And the questions? I mean, my gawd, they are horrible, they are mostly interested in how they come across to their constituency. They are all grandstanding so they look like they care. Really? If you cared so much why didn't you say something BEFORE there was a crisis? Ever hear of preventative measures? Hmm, might want to read up on that, ya know? Unreal. Now, as far as the market, we continue to trade in crazy ranges intraday, which is good for us, and we rocked again. I really love this market. Now, will we get 2 up days in a row Wednesday? We very well might, but its gonna be tough to get any traction here more than likely. I'm beat, talk to you all manana! RULE! Waxie

Monday, November 17, 2008


VERY brief reason, I have to go catch my daughter at Karate, sorry! Nice day for us, by the way! ROCKING! CNBC just said that COF, STI, RF all got money under the TARP, all got BILLIONS, which is absurd in and of itself. Why haven't we and why won't we reach a REAL bottom for a long time? Because every stock the government has "helped" gets cracked. I mentioned AXP being the latest, yet DUMB investors and traders just bid up COF as though this was GOOD NEWS! I mean, how many times do you have to get beat the crap out of before you say "I GIVE UP!". Look at today, they tried to bounce us and squeeze us (very tough day) and in the end they were cracked - AGAIN! Who is buying this market here other than suicidal maniacs? I think we bounce this week at some point more than likely, so I am not trading heavy here (though I am HEAVY in GS puts as I think it sees $50 or less SOON!) but I mean, you have to be insane to buy stocks here for an investment. INSANE. OK, I have to go, go short COF and ring the register! Kidding...kinda sorta! WHEEEE! RULE! TARP funds = FREE MONEY SHORTS! Thank you HANK! Waxie

Sunday, November 16, 2008

Thank you, Frankfurt! And, the naysayers!

Had a great time in Germany at the World of Trading. My sincere thanks to all the wonderful people who showed tremendous graciousness throughout my short stay. I felt at home and I am grateful. And, big thank you to Oliver who showed me around town and (over)fed me some very good food! I ordered like a New Yorker and they looked at me like I was nuts, hehe. I didn't realize that food portions could be so HUGE! My eyes were definately bigger than my stomach!

I'll tell ya, it never ceases to amaze me at how wrong I can be about some things in life. I thought I was just gonna fly in and fly out, but the people here were so warm, contrary to some things I've "heard" over the years. And, its remarkable that perceptions are so off sometimes. I think that expectations are the birthplace of all downers. I wasn't expecting much, and so I had an amazing time. Also, we truly are all in this "thing" we call life together. People everywhere are suffering from this economic malaise. Unemployment, discontentment, fear are everywhere. People who were previously flourishing are struggling and worrying about how they are going to survive without their jobs, or best case often a severe pay cut. Or, if they have job "security" they wonder and worry it won't last. It's unfortunate, but I do think that while it can bring out the worst in some people, it can also bring out the best in some as well.

I met some newbies at the Expo and they were excited to embark in what I think truly is the best job you can have - trading! You all know why, I think, by now. You make your own job security if you can master it, with or without our help. I'm grateful I got to meet and work with so many very new and very excited soon-to-be successful traders! Welcome here, I know a few of you have already written me and are reading this! Guten Morgen!

I want to address something, this is something that over the years I've dealt with, particularly when the market is getting crushed as it obviously has been. When the market is going down most people get hammered, whether they are investors or traders both. This market isn't easy, and while I boast of victories and I do believe that this is a GREAT market to trade, I hope I get across also that it's not like I make money on every trade, or even every day. That's absurd, and I want to be clear about that. We have a ton of traders ROCKING, but we of course have some who haven't quite figured it out yet, or are still investing and thus there is little I can do to help them. Having said that, when the market is going down I usually get "hate" mail. I find it childish and honestly feel sorry for the sender most of the time (though I've had threats against my well being and my families, which I take very seriously). Usually people are angry at someone outside themselves when they are struggling, so it's sad. Here is one I got today, it's a VERY sedate one compared to a couple of recent ones. I'm posting it because I'm kinda annoyed getting these absurd emails saying that I don't do this or that. My job here, in my view, is to help traders make money and build confidence, and, yes, at times, boast of my prowess and my clients prowess as traders. If I didn't honestly believe and frankly KNOW that we can help people make money, I wouldn't be able to show up for work every day. We've been doing this for a LONG time, over 10 years now. No matter how much I may brag, or tell you all I rule or whatever, if the proof wasn't in the pudding we wouldn't have any clients, let alone be THRIVING in what everyone else proclaims a horrible market. The feedback we're getting is that MOST of our clients are ROCKING. I know I've been rocking. I have proof of that, and I don't need to lie to sell our services, I always suggest YOU try us for a month and if you don't make money, ok, you didn't cost yourself much and you bettered yourself no matter what because I believe anyone we do in life is a step toward LIFE, or death. Making an active choice to try something new is clearly a choice toward life, even if it doesn't work out the way we'd like it to. Trading isn't for everyone, but I believe its a great way to earn a magnificent living, make your own hours, be your own bos and RULE your own life! The naysays, keep the nasty emails coming, there's an old saying, I like it a lot - resentment is like pissing down your own leg, YOU are the only one who feels it!

My best to everyone, even those that doubt the TRUTH. I LOVE THIS MARKET, try the chat room or Options Trader and you'll love it, too!

Oh, one more thing, we have a TON of German clients, I'm so grateful to have met you all! Special shout out to Patricia, thanks for your hospitality as well. And, again, to Oliver, who is a good man and a special friend from here on in, you are always welcome in my home when you and your family make your way to New York! Keep on rocking with your warrants on GS and God Bless!

And, for you Rich, here ya go, you get your letter, which I appreciate as tame by most standards. Hopefully this post addresses your concerns. For every $5 MIL a good trader makes, he probably has $4 MIL or more in losses and shows a $1 MIL or less profit. THAT, my friends, is trading! You don't win them all, it's not a spring, its a marathon, but if you master it, you can make one helluva livin'! RULE ALWAYS! Oh, and for the TON of testimonials, keep them coming, I obviously like hearing those and get a LOT more of those then these ! RULE! WAXIE


Have you ever owned your losses/mistakes? This has to occur in a market as volatile
as this one, however, to admit such would be too much of a narrcissistic blow for you.

Happy Trading


Friday, November 14, 2008

THE WAXIE PLAN, and why it should work...

First off, let me say one thing - NICE FOLLOW THROUGH on yesterday's rally! Man, this market is a disease, buy at your own ridiculous risk, you will get burned big time!

OK, so let me preface this post by saying the following - I am NOT an expert in economic theory, nor am I sure that what I am about to propose will work. I'm posting some thoughts and am open to feedback (email me at - from you all. If something I am saying is illogical or out and out wrong, don't be shy, let me know, I'm shooting from the hip here and am ok with input, right or wrong. OK, let's begin.

Let's call this my 3-point plan and see what happens. I'll also say that this is part of what I think (pure speculation) Obama is going to do, at least in part, and why I think that the stock market is TOAST and anyone who doesn't get it, will get a chance to see what DOW 2500 feels like!

1)The government nationalizes the insolvent, or virtually insolvent banks, of which I believe there are many. If you look at the books on banks like C, MER/BAC and even WFC/WB and CYN and such I think you should find that a lot of what's keeping them afloat at this point are depositors money. Now, I can't state that as a fact, but that's what it appears to me as a dude who knows a tad about this stuff and who's been pretty dead on so far.

This is why I think that anyone buying financials is NUTS at this point. I think you're looking at a very bad outcome to this who system/sector and I think its inevitable. Paulson can say anything he likes about how strong the banks are, notice how we rallied on him saying that and then completely tanked? Yeah, well, figure it out! Too much smart money is betting against these things to not take it serious that they are in a very dire situation. Since we are headed toward socialism anyway, the cleanest thing to do, rather than throw good money after bad, is for the government to take over the banking system either on a case by case basis, or in it's entirety. Personally, I think we should let it all fall apart and start over, but since that doesn't seem to be anyone else's opinion, this is next best.

This would effective wipe out the entire financial sector's stock market worth. This would have to encompass the insurers and some other troubled companies.

2)Obama has stated that the government should have some more controls over retirement accounts. If that comes to pass I think that #1 may very well be part of the agenda. I think that Obama is willing to sacrifice Wall Street for main street, he's made that very clear. By taking these measures you basically wipe out shareholder value left and right. Obviously companies have value, so they will either take themselves private and be ok with the new valuation models that I believe will happen one way or another. Investors and fund managers have been spoiled, they think its reasonable for companies to sell at 30 X's forward earnings, or even 15 X's forward earnings, or 10 X's current earnings. That's not realistic in a real world business model. If anyone wants to buy out at a 10 X's current earnings let me know, I'll sell it to you tomorrow. And, I think we have tremendous growth opps here, so in terms of the stock market, you'd be getting the steal of the century! I won't hold my breath, but the offer stands!

3)Once the government has taken over the banks, or in conjunction with, instead of injecting the banks with all this stupid money that is just being thrown away, start offering 3% or lower mortages to eligible buyers, and rework current mortgages to those that can afford to stay at their new realistically worth homes. The banks can't do it now because its not profitable, if the banks are nationalized then it becomes possible because the government doesn't need to make the "vig" on the Fed Funds rate. By doing this you would stimulate the housing market, and allow those homeowners who can and want to stay, to stay. Interest rates are 1.0% yet because of the credit crisis banks are still asking for 6 to 8% for mortgages. That's way too steep a profit, but they need to since they are drowning in debt, and are afraid to loan anymore. People buy when the market is or should go UP, or they buy because its as cheap or cheaper to buy then to rent. I would buy a place if I could lock in a 3% or less mortgage, then it would pay for me to do so, plus I get the benefit of owning something. Otherwise what's my incentive? There isn't any, hence the problem, or one of them, with the housing market's reinvigoration.

So, in effect, what I am calling for is for the stock market to be sacrificed rather than the consumer/home owner. I am asking for the stock market to reach its organic levels. This charade that the banking system is fine will only lead to more and more investor and company crushings. Let's stop the BS and do what needs to be done to the SYSTEM. Having hearings on Hedge FUnds, which are the only thing I would ever consider investing in if I was going to invest, is ludicrous. They are going after these guys because they made too much money? That's absurd. This is AMERICA, a capitalistic/free market system. You can't limit people's ability to earn what they can...unless its done so illegally or immorally. Yes, I know, I am sure I will get at least a couple emails saying "it's immoral earnings $2 BIL a year!" To that I say - PHOOEY! That's rubbish. If the hedge fund manager made $2 BIL in a year that means that the hedge fund investors did pretty freain darn good! So, that's why I think that we should just admit we are now a socialist country and go for the whole nine yards, rather than pretending it's all in the name of capitalism. Be real, dudes and dudesses, be real!

Something has to be sacrificed and my vote is the stock market, I think it'll survive without C, trust me. I'm not advocating the government take everything over, but they can take over some things that are just so damaged they need immediate attention. We're so intent on saving GM< which is a DEAD business, its time for us to do something rewarding in LIFE!

See ya on the other side,

Michael *Quick" WAXIE

Thursday, November 13, 2008


Nice reversal today, baby!!!!

WHEEEE! Gotta love this market, folks. We got rich early, and late. SWEET! I went home almost entirely FLAT for the first time in a long time. Hoping we get another pop tomorrow and see what shakes next week for reentry to the short side. That's why they call it TRADING! No volume on the break below the lows, and a lunchtime reversal. VERY VERY NICE! Had a nice day before i now leave to airport to Germany. I don't speak any German, but I think Guten Tag means something, like good night? :) Good luck tomorrow! Remember, TRADE 'EM, don't marry 'em! 900 point ranges, who the hell doesn't want to trade this EASY market? IT's RAINING MONEYYYYYYYYYYYYY!!!! :) RULE and enjoy the weekend, I'll try to post from Frankfurt. RULE! Waxie
One more thing, did I say this market is RAINING MONEY? Yeah, it is, folks, it sure is!

Wednesday, November 12, 2008


OK, so I really have a hard time watching this Booyahhead, but I really have a harder time listening to utter nonsense. The notion that we should prop up home prices and that will solve everything is up there with anything else nonsensical the guy has said. First off, you can't keep a market up that is overpriced for very long. It's never happened, and never will. You can artificially prop it up, as the Fed has tried to do time and again, but it won't work for very long, as we've seen time and again. Part of the reason the depression lasted as long as it did was the government tried to assert it's will on the markets. This just delays the inevitable, which is what will happen with GM if and when they prop them up. Secondly, part of the problem is the obsession with a rising stock market. If there was an honest discourse people would understand that having their entire 401K's in the market, which many do, is LUDICROUS. In my new book, Rule Your Freakin' Retirement, I recommend you have AT MOST 15% in the markets, and thats if you are younger than 30s. Right now I wouldn't have 1% in the market on the long side, as I've been clear about. People have been sold on this notion that if you can wait it out you should be in the market. This notion is fatally flawed, and when we are south of 5000 on the DOW and south of 800 on Nasdaq, that will become very clear. The housing market should be allowed to bottom on its own, same as the stock market. GM should be allowed to fail, so should F and so should Chrysler. That's why they have bankruptcy laws. Government intervention only works if its based on something that is tangible, something that can last. The markets, all of them, are still vastly overvalued. Until there are realistic expectations. Over the years I've seen this a few times and each time the market VASTLY underestimates the pain that is inflicted in a bear market, and this is the mother of bear markets, folks. But, there I go again, repeating-repeating myself. Do not try to bottom pick this market, look at all these stocks that "experts" say are so cheap. FCX, X, CLF, POT, DE, C, MSFT, etc, etc. All such good deals. I've heard this all before, its a bad recurring nightmare and the only way to wake up is to realize that reality is lower and you'll know when we can buy, but it ain't now and it ain't anytime soon. We will get a tradeable bounce soon, perhaps next week. We'll play that, but the notion that we will get a multimonth rally anytime soon is highly unlikely. Not impossible, but highly highly unlikely. I'm just not sure where we can go to the upside. Normally that would be a contrarian indicator, but like I've said time and again, this Bear market is special in a bad way, and it doesn't act like most Bears. As bearish as I am, even I didn't think we'd get taken down this far this fast. That's meaningful because it means there are other factors here that we have to account for. I've never seen so many put buyers be right. The option volumes are giving such huge tells, we have to heed them. Watch the rails now, I think them and the credit cards are next to fall. The wisdom has been that they are immune, I don't think so. We'll see. I'm going to bed now, but I had to discuss this knuckle booyahhead. Call your local rep, tell them to stop the bailouts before we dig ourselves an even deeper hole. Before its too late. Waxie

IF YOU DOUBTED DOW sub-5000 before...

PLEASE heed this. I've been beating the crap out of you guys for a long time saying to sell SELL SELL, while most everyone else has been saying we'll see a bottom. Well, you know what? They are WRONG! The DOW will see sub-5000 and frankly I may be adjusting my target to 2500 shortly. I am doing the research, but I think that we should see 2500 or less when this is done.

Here is the inherent problem with the notion that this is the same as other bear markets. Bear markets are usually based on a few factors, one of which is valuation. That, in my opinion, is the least of the issues. Others include valuation based things like "bubbles". More importantly, though, is the economy, which includes unemployment, manufacturing, sales, etc. Even more importantly is consumer confidence and investor confidence. ALL these factors point to MUCH lower prices. BUT, none of them is the most important in this instance. In this instance you have what happened in 1929, a confluence of events and factors that has created what I've dubbed the PERFECT STORM of investor disaster, or the real Y2K, but of the stock market. Today we heard from Hank Paulson, whom you guys all know I have HUGE issues with. Those issues I've stated in depth here for a long while, and relentlessly. I feel like Franky the Repeater from Goodfellas. I keep repeating, repeating, repeating myself, yet I would be remiss if I didn't do so, given what I feel is the gravity of the situation. Today Paulson said what I've said again and again - the "bailout" was total BS and will go down as the biggest con job this country has ever known. They force fed everyone, including congress and the senate and investors and "main street" the notion that the government was going to buy all these toxic assets, create a market for them and the government would then be able to make money on these "assets". Many of you will recall that your buddy (not mine) the one and only BOOYAH HEAD proclaimed that it was so great, that the US Government was now the largest Hedge Fund ever, and that we would make money on this $700 BIL. That the taxpayers would BENEFIT from this money and would not be on the hook. This NONSENSE has been repeated AGAIN AND AGAIN AND AGAIN all over the financial media, as though it was true. Fund manager after fund manager has trekked onto CNBC and other places and told YOU that this is a good time to buy. Everyone from Suze Ormon, to Booyahhead, to all the other knuckleheads out there STILL keep saying if you have a 10 year horizon, now is a good time to buy buy buy! Dennis, the biggest knucklehead of them all has said repeatedly that there is "no way the market isn't going to be higher in 10 years". I am never one to plead victim, and I really loathe people who invest and then lose and blame someone else. Having said that, when someone or company basically guarantees that you will make money if you do something, that is cause for concern. The same as there is no way I could guarantee anyone here that I am right. I could be wrong, it's happened before, just ask any woman I've dated, they will tell you how wrong I can be about a whole host of things! All I can do is relate my opinion, and tell you what I am doing or thinking. I'm not licensed or registered, and I never would want to be. I'm just a dude who has an opinion, you read it, you do what you wish of your own volition. Win, lose or drawer its on you. If I guaranteed things then I'd be a lunatic, and frankly I'd advise none of you to take me seriously. Do I feel strongly about what I say? Absolutely. I am, however, not always right. It is irresponsible for these people to continuously pound the table that you should keep buying when there is no empirical evidence to support the thesis that we have "bottomed" or are anywhere near it. The notion that you should buy now and hold for 10 years and that historically that has paid off is another LIE that is perpetrated by the media, and by fund managers alike. There is an inherent conflict of interest in most of these people's and companies preach. Today we made a MINT in the chat room, and Option Trader, which you ALL should sign up for, is beyond rocking. BEYOND. We are calling double, after triple, after quadruple and it's so good that we are getting a ton of testimonials nearly every day. No guarantees that will continue, but the service has been INSANELY profitable for many. OK, lest I digress. Today's speech by Paulson is so bad that anyone buying ANY bank is, in my opinion, INSANE. My interpretation of what Paulson said today is that the nonsense that these toxic assets have no value, therefore banks like; C, BAC, WFC, COF, STI, NTRS and MANY MANY others, in my view, are in very serious trouble. That's why I called MS short, PFG short, BLK short, COF short after he was done. ALL winners in a big way. That's why I continue to LOVE GS short and feel that my target of $25 is probably overvaluing them. You have to listen to reality. BBY today said things are DONE for retail. After the close INTC said things are horrible. Now, look, I'm short and will remain exposed to the short side until we hit my targets. I put my money where my mouth is. I have made a FORTUNE in this market. Clients are RACKING UP in a HUGE way. YOU need to get off the sidelines and get in the game. You need to stop watching your finances drop off a cliff and do something about it. I can't promise anything. I can't promise you will make money and I certainly can't promise you that you won't LOSE money. Trading on any level is not for everyone. BUT, I think that this market continues to present GREAT profit/Ka-chingo opportunities for us. These opportunities won't always be here. Certainly if and when we do get to DOW 5000 or 2500 there will be less volatility and thus less opportunities. BUT, at some point we will be able to scoop things up and trade them LONG for swings. That time is NOT right now. I don't remember the last swing long I took. I think it was a loser, though. I'm pretty sure of it. ANYONE buying here for more than a trade is NUTS in my opinion. Just think about this - ALL (or almost all) of the so-called "experts" who keep saying now is a good time to buy have been saying that for roughly 2000 to 5000 points now. Dollar cost averaging is for suckers, in my new book coming out in March, Rule Your Freakin' Retirement (St.Martin's Press) I show a study that was done that disproves that dollar cost averaging actually works in the long haul. And, dollar cost averaging, as well as investing, always assumes that the market will go higher in the long haul. That is a very bad assumption. Do you realize how many fund managers, and BOOYAHHEAD who called the financials and the market bottom in July, have destroyed their clients by buying the financials? Even the Fast Money (Fast way to LOSE Money) people, some of whom are decent traders, have recommended owning GS, or some of the other banks. Or, selling puts against them. People have a very hard time believing that something is over. People stalk people, and they stalk the stock market, thinking that it's going to go up eventually, let me look for entries to buy these stocks. Look at C, I said many times it would see single digits. I said that when it was $40s. What Paulson said today should make C insolvent. From what I've read and the research I've done (and again, I'm not an expert researcher mind you), C has roughly $300 BIL in bad/toxic assets. The NY Times reported that MER has some $260 BIL in defaulting/toxic assets. The bill of goods the American people were sold is shameful. Do Paulson and Bernanke claim they didn't know these assets were worthless when they said that taxpayers should be on the hook for $700 BIL that I said from day 1 was throwing our money away? Who benefited from the $10 BIL each given to JPM, C, WFC and others? There should be an immediate investigation into what happened and who got that money! That's OUR money, folks! What happens when you give a company with $300 BIL in bad debt $10 BIL to help them? You throw $10 BIL into a garbage can, that's what happens! I wish I had the time, or that I had run the commercial I was going to run on CNBC when it happened giving my opinion and offering that I would personally oversee the $700 BILLION. Someone else needs to be in charge here. And, its going to get worse. The GM bailout again will be sold as an INVESTMENT, and sold that GM is too big to fail. This is another TOTAL LIE! GM has to be allowed to go into bankruptcy and to reorganize, otherwise its a 100% guarantee that they will keep coming back for more and more money. It's theft, folks, plain and simple. $700 BIL that WE will be on the hook for. I am sick to my stomach. Fed up. I feel like going to my window, opening it and yelling out - I'M MAD AS HELL AND I'M NOT GOING TO TAKE IT ANYMORE! If the American public paid attention everyone would do the same at the same time. In fact, I'm going to send an alert to the 100,000+ members we have and give everyone a time that anyone who feels the same can do just that. The thing is, right now most people don't realize how bad this is, and how big a lie this was/is. When the proverbial "S&*t" hits the fan, if I am right, it's going to be quite the ugly scene. As far as tomorrow goes, well, I lost my passport so I'm still in NYC! Hehe! So, I should be around, and Friday more redemptions come in from Hedge funds and such. So, seems hard to imagine we get any lasting rally here for now. The path of least resistence is DOWN, and should remain so for the time being. A retest of the supposed bottom may happen tomorrow. Does it hold? Well, it might, for now, but I think 7500 is coming sooner rather than later and if we were to break there then I will see you on the other side...of 5000! Keep trading, keep listening, the answers are always there for us if we are open to hearing them. Me? I'm just a dude who cares and who believes that after the dust settles there will be a better day, or two, or three. Until then I'll just keep plugging and keep the faith! Keep the faith despite the fact that some of our leaders are misleading knowingly. It's a shame, we should have let things fail and started over. The path we are going down will only keep us in a DEPRESSION for far longer than we should be in. The banking system has cancer, it's got cancer and its spreading, and unless we cut out the cancer the patient, our economy, is going to DIE. And, you know what? Everyone I said here now, as usual - I hope I'm wrong. I hope we never see 5000, I hope we never see 7500. I hope we go to 25,000 on the DOW, and I hope that everything they are doing helps, or better yet solves the problems. That would be wonderful, I would be SO happy to hear everyone tell me I suck, that ha-ha, I was wrong! That we all should have bought what many of these nutjobs say is the "buying opportunity of a lifetime". I hope so, but as I've said before - HOPE is a four letter word when it comes to your money, and your life. I should spell it like this, same as any other curse "H&*E" = HOPE. Be smart, protect your assets, don't be a deer in a headlight like most investors. Plan your life, and live it! As always - rule! Michael "Waxie" Parness Oh, and PS, sign up for OPTIONS TRADER for Gawds sake! :)

Monday, November 10, 2008

Well, that was easy...

Today had to be like the easiest GAP short of all-time! Seriously, how we were going to go up more than the 200ish points they gapped us? Did anyone think we were going to go up 500 pts today? This market is INSANELY easy. INSANELY. I hate saying that because I'm supersticious, but my Gawd, this is NUTS! S & P gapped up over 27 pts from Fridays 4 pm close! On what? China stimulus package? ROFLMAO! Our own hasn't worked to get the market to go up, but China's will? If you think logically in this market, its RAINING MONEY. I haven't done this well this easily for a long long time! Life is very very good and I am living LARGE, baby! And, todays calls - AGAIN - were insane. We NAILED IT! yes, I am bragging, because I think we are just completely devouring this market. And, did ya notice GS? My #1 short since it was about $150? Hmm, amazing, the stock should be $15 and they keep asking "why is GS going down? They are so smart!" Yeah, they are so smart that they blew their company up, just like all the other brokerage houses did. Yeah, they are brilliant. Please, give me a break with this nonsense. GS is going down because they have NO WORTH! That's reality. You want to keep telling me that Warren Buffet bought warrants at $115? First off, its NOT TRUE! Secondly, there is no secondly! The media keep portraying that deal is a way that is completely misleading. Buffet didn't "purchase" anything, he gave GS a loan, a lifeline at 10% interest that gives him preferred shares, plus the interest. That's what he did. He HAS warrants which are exercisable at $115 if he wants, but I doubt Mr.Buffet really thinks GS is worth $115 a share, he just did that as a bump is my GUESS. I try not to make statements without facts, crazy as that might seem watching day in and day out the insanity of the market!
OK, so I need to comment on Booyahhead tonight. Let me tell you something, his pitch tonight that the market needs the government to bail out all the automakers for us to get a "sustainable rally" is LUDICOUS, and once again will lead investors to their financial deaths. This market is GOING DOWN NO MATTER WHAT! Of course the government will bail out GM, and the others! DUH! They bail EVERYONE out! FNM lost $29 BIL this last quarter! $29 BIL! AIG has "only" destroyed what, like $130 BIL of taxpayer money? Oh, yeah, I forgot, we'll all make it back because AIG is a good investment! Sorry, I forgot, please forgive me! If and when the market rallies on a bailout of the automakers, it will be once again a total lamb to slaughter situation. ANY rally here is. People are nuts for thinking that you can buy this market and hold for 10 years and you'll make money. NUTS. INSANE. I spoke to an old friend today and she told me that she was buying Berkshire at $3000 if it gets there. I asked her why and she said that she was holding for 10 years and that thats a "good deal". OK, she knows my opinion, and I could be wrong, but I don't see ANY reason to try to bottom pick here. Look at how much money is being just thrown away by the government on our behalf, and its not doing a thing. This is a QUADTRILLION $ problem! The government doesn't have enough money to do what needs to be done. That's why, in my opinion, something needs to be done OUTSIDE THE BOX! Throwing money at GM? I mean, what will that do? Keep a dead company in business? How does that help? It just means that government gets to tax us more and more and destroy the financial fiber of the country for years to come. GM is DEAD. It's lost money for a very long time, it can't possibly make money the way it's structured. So, a bailout does what? How does that help? It is INSANITY, pure and unadultered. Fold the freakin' company. Set the workers up with other work that is needed. Offer them a buyout, or a job doing improvements in other areas. I'm sorry, I know it sounds heartless, but there are millions of other people and hard workers who are suffering as well, why does anyone think that its appropriate to bail out one industry and not others? It's INSANE. And, ultimately it will lead to them folding it anyway. If I'm right, which I hope I'm NOT, then GM can't possibly be profitable EVER. That's right - EVER. So, when the Fed tells us that GM is going to make taxpayers money, same as AIG, and same as the Tarp program and the 700 BIL bailout, its total BS and an out and out LIE. And, I for one am sick. And, its not because they are bailing things out. I don't want anyone to suffer, but its because there is NO PLAN, its like water to them, and they keep rallying the market so stupid funds keep killing investors. It's a vicious cycle and the cycle will continue until there is finally capitulation all around. Until the taxpayers tell their representatives that ENOUGH IS ENOUGH, stop the insanity, stop throwing our money into the toilet bowl, stop bowing to pressure from lobbyists, stop trying to stop the bleeding from an amputated arm with a bandaid! Only when there is a real plan that doesn't react everytime someone says "help me, we need TAXPAYER money!" only then will things start to turn. Until then, EVERY SINGLE RALLY IS SHORTABLE! Sustainable rally? Booyahhead, you are a knucklehead and should know better. GM isn't the issue, the issue is that the stock market is VASTLY OVERVALUED. That means it goes DOWN, whether its today, or 3 months from now, its FINISHED, the party is OVER. Sub-5000 on the DOW, see ya there!
Watch Tuesday for some more down movement with turnaround Tuesday potential and a rally probably on some news. 900 on the S & P would be a nice turnaround potential point. Make sure you have stops set on your shorts, best thing that can happen is we get a rally and then we get to reshort higher, which has worked for us for a while now. Financials are in very bad shape and look a LOT lower near and far term. I would be very careful to try to catch that falling knife for more than an intraday trade. AXP was approved by the Fed to get loans as a bank holding company. Stock was up after hours. Just remember, every company that has done that is down DRAMATICALLY a few weeks later. See GS, MS for two very good examples. I expect AXP is in trouble and thus a great swing short if it gaps up. It may rally when we bounce Tuesday or short term, and thus I would just add to the short more than likely. These moves mean that these companies are DESPERATE. It should be a reason to sell the stock, not buy it, but that's why I say that this market, knock on wood, is the easiest freakin' market next to 1999 I have ever seen. Turnaround Tuesday? We shall see, but decent shot I think. Remember, TRADE 'EM, don't marry 'em! Next to go down? Sign up for Option Trader or the chat room and you'll find out, I have some, what I feel, are VERY strong plays coming up! RULE! Waxie

Saturday, November 08, 2008

The curious case of Goldman Sachs...

As you all know by now, I have been short GS for a while, and am up quite a bit on that short obviously since its sitting right over 52 week lows. While the other brokers continue to get hammered, GS has held up remarkably well. It's been my experience over the years that often the best shorts in a bear market are the last stocks you would expect to fall. While they may hold up stronger for a while, when they roll over, they roll over in a BIG BIG way, and you have the added edge of a more dramatic down move. On this blog I've called and been right about a number of these stocks; POT, FSLR, LEH, FNM, FRE, GS, GOOG, etc.etc.etc. There are a few stocks here that still have a lot of downside left to them. Friday I called puts on TM. I got an email from a subscriber who asked why I would want to short TM, that if GM goes under (govt won't let it, wrongly) TM would pick up their market share. First off, that's not necessarily correct, and secondly, TM just announced sickly horrendous #s. The only way you can own TM here is if you think that they have made a Faustian deal with the devil! The stock is a $68.50 stock in the auto industry! Sales are cracked and will get worse more than likely. This is the type of swing short I'm looking for now, stuff that makes sense but the market hasn't caught up with it YET. I have a few on my radar that I'm giving to clients, but some of them I've mentioned before and continue to pound the table on them, like TM and GOOG and GS. GS is an enigma. They are in no man's land, and the only reason I hear for owning it is that they are "smart guys" and that they will figure it out. Really? Then why are they in this mess to begin with, if they are so smart and so good about figuring things out! With MS, MER, BSC, LEH, LM all slamming lower, GS should be $20s in a couple/three months. I see no compelling reason for us to rally here, other than some wishful thinkers. The financial sector looks ready to move down harder and lower, potentially this week. Several banks I LOVE LOVE LOVE short, some not so much. It's a good group to couple up if you have a sense as far as who will weather it out easier. This coming week I have to lean lower, but not heavy. At least not initially. Too many guesses and not enough clarity. Do we go back and retest recent lows, or do we bounce first? That's the ultimate question, and one we'll see soon enough on! I'm flying to Germany for a conference in a few days so may not be available here til I get back. Remember to rule! Waxie

Thursday, November 06, 2008

The Fantasy Thinking, the Madness and the Sadness...

The market rose last week and Monday/Tuesday on Fantasy Thinking. Which, in layman's terms is HOPE. The fantasy that the Fed's moves are loosening the credit markets, freeing up captial for lending to stimulate the economy. The fantasy that a new President, as great as we all HOPE he is, will be able to solve what until now is unsolvable. The fantasy that valuations are so compelling that even though the whole world is in the crapper, you should be buying because the market is "cheap", and the fantasy that the market is forward thinking, and therefore the economy will turn around eventually and so you should be buying now for the time when the turn happens.

The Madness is believing any or all of the above and acting on it. The Madness is the government continually finding reasons to bail out companies that are antiquated becuase "it's too big to fail". The Madness is listening to these "reports" that suddenly get released right before GM's earnings that say that if ONE of the big three car makers fails that it will basically ruin the economy to the point of no return, and cost $100 BILLION. The Madness is that I haven't heard anyone say who sponsored this "report" and I'm thinking there is a conflict of interest in there somewhere. The Madness is that we're bailing out homeowners that can't afford the standard of living they have. The Madness is that despite every evidence to the contrary, analysts, fund managers and investors refuse to accept the fact that the market is not just a little overpriced, that it is VASTLY overpriced, even at 8600, even at 7500 and even probably at 5000.

I am VERY empathetic to those amongst us that are struggling. Most of us are struggling on some or many levels, there is a dark cloud hanging over a lot of things right now. I know that it is very un-PC to suggest that GM and F be allowed to fail and go bankrupt. We have a lot of Union workers as clients. I have many friends who are union workers in various industries. There is, however, a very distinct conflict of interest when the government is deciding who gets taken care of, and who doesn't. For example, by definition, let's say Trend Fund were to "fail" and we had to lay off all employees (plus I'd be out of a job, too!). Should the government bail Trend Fund out? Why not? Why should the people here have to go on unemployment while the government is going to bail out companies that can not possibly succeed. So, all they are doing is protecting the pension plans, and jobs that aren't necessary. It would be, in my opinion, much better for the government to extend unemployment benefits and in fact RAISE them dramatically so that there is a cost savings, rather than keeping companies going that will just bleed the taxpayers of everything they have, and thus extend this misery? The pensions, give buyouts so that those people are taken care of best case. But, just remember that when Enron went under, and LEH and others those people weren't remotely taken care of, they were let go and they let them lose everything in many cases. It's a problem when the government is just taking over everything on a whim, which is what's been happening clearly.

The sadness is the madness, and is the fantasy, because in my opinion most of what's been done will come back to haunt us, and it won't work - NONE OF IT. Yes, I am the grim reaper. Until the markets, companies, and people are allowed to succeed and fail organically again there will be no "bottom" in anything. It's frustrating. Look at everything they have thrown at the economy and at the markets and what good has it done? We are right off our multi-year lows and we show no sign of forming any kind of lasting bottom anywhere in sight. There is no rationale for anything being done, there hasn't been throughout this. That's part of why it's gottten worse, not better. The system is broken, and it needs to fail so that it can be reborn as something better and stronger. Nice rally last week, all those fools that rushed in to buy Monday and Tuesday this week are already SHOT. There needs to be a "time out" and a plan, but that's fantasy, madness and sadness on my part since it's just not happening and not likely to do so. Let's see what they do with GM. They can't possibly be ridiculous enough to give a $25 BIL loan to a company that is never going to recover. NEVER. You can point to history all you want, but as long as they have all those pensions on their books its just impossible for them to make enough to cover their nut. Very sad. Same as the homeowner who can't pay their mortgage, they need to be able to start from scratch! The market tomorrow SHOULD bounce at some point after the #s come that are going to be brutal, the thought being that it's "priced in". That's the fantasy and the madness, but you can trade both. Eventually you pay the piper, but probably we keep trading this range until we break it lower more than likely. Stay cash, stay a trader and stay in reality! RULE! Waxie

Wednesday, November 05, 2008

OK, I'm ready...

To give Mr. Obama a chance. I have to say that I was very impressed by the classiness of both candidates post-election results. And, I have to also say that I haven't seen the type of enthusiasm for a candidate perhaps ever in my lifetime. Whether or not the substance ends up being there I think it fair to give someone who, at least on the surface, carries a message that in my opinion has been sorely lacking in this country for a very very long time. We tend to be hero worshippers, I think, in this country. We put celebrities, politicians, CEO's of big companies and others at times on pedistools. We being a great big grandiose statement and a gross generalization. Yet, I've found it to be true. I'm just a dude and even I have had people do it with me at times. Many of us tend to compare our insides to others outsides and when you do that you always end up as a loser. Everyone has their own issues, imperfections and challenges, it's all relative. When you live on a park bench you find out that your hero worship is anyone who has a hot meal, or some pocket change. The knock on Obama is and remains to his detractors that he is all style and no substance. Even I have said that, at times. And, that may yet turn out to be true, but this country is in dire need of HOPE and a change. When I was growing up, even when I was struggling, I held the belief that the United States stood for something. Perhaps it's naive, but there were ideals, and some people even seemed to live by them. There were ethics, and we were generous. This was the place that asked for the rest of the world to give us their know the rest. One thing that I think happened after 9/11, at least in my view, is that fear became something that many 0f us lived with day to day. I certainly felt it at times. Fear does bad things to all animals, not just us humans. We become about survival, it's the old "flight or fright" mode. We start to look at things that are harmless as though they are out to "get us". Again, I'm generalizing, so forgive me if I am speaking in too broad strokes. My point is that we were founded on a belief system that was accepting of, well, everyone, or just about everyone. And, in my opinion somewhere along the way we became scared and frightened and we started to act in ways, at times perhaps, that violated our own belief system(s). One of my favorite films of all time is Dawn of the Dead. Seems silly, but the original is a brilliant parable for what I think I am trying to get at. Sometimes you end up killing the living because you fear the dead. We used to be a country that was idolized and welcomed in most countries. Fear has helped create, in my opinion, a country that is loathed in places where we used to be greeted with open arms. Instead of talking softly and carrying a big stick, we've taken on the role of hitting things over the head before even talking. We rule by fear, instead of respect. Respect is earned through good deeds, honesty and openmindedness, and ethics. It's earned by speaking one's truth, and hearing what others have to say, even if we don't agree with it. Our first amendment is very powerful stuff. Look at this blog, I write very inflamatory stuff at times. Without the first amendment I'd be arrested, or abused in some fashion because of some of the things I've written. A man, or woman, should not be judged by the words, but by actions. I've heard many politicians talk about being centrist. They were going to work with both parties (all parties) and while they may disagree about many things, they would walk away with respect and a better understanding. Until this crisis our country is in, I'd never seen both parties actually work together. Crisis does that at times, too. So does fear. I guess perhaps that's the flip side of things. Can you imagine what it might be like if that was an everyday, or at least every year occurance in government? Instead of thinking about the individual, it became about democracy. Instead of being a world leader based on how many weapons we have, we went back to being a world leader based on the merits of our actions as a whole. Maybe that's just plain naive, or perhaps some would view that as "whimpy". I think John McCain's speech was outstanding. I actually thought President Bush's short talk this morning was outstanding, and human. To me, we're all in this together when it comes down to it. That's the other thing 9/11 teaches. Republican's, Dems, Libertarians, gays, straights, Jews, Christians, Muslims, agnostic's were all killed in that act of terror. Will Obama be a bust? It's certainly possible, but he already has the respect of other nations. When was the last time other countries people's wore shirts with a US President's face on them? I do not agree with some of the things Obama has stated he wants to do on his agenda, particularly economically. But, I do have a sense that at least he will TRY to live up to his promises, and in this day and age where politicians make promises that even they know they have no shot of keeping, that is pretty refreshing. The only thing we really own in this life is our own integrity. The old adage about "two wrongs don't make a right" over simplifies this, but it's true in the end. Just because I am wronged doesn't give me the right to stoop to the level of the perpetrator. If I do, then what seperates me from them? I lose my integrity, I am nothing. Obama isn't remotely perfect, and he's certainly got flaws and will be a flawed president because that's the nature of life, and the Presidency. You can't please everyone, but the guy won over 52% of the popular vote as a black man who has a lot of baggage from his growing up. Perhaps fear itself in this case worked for him, in fact I am sure of it. He almost surely would not have won had the economy not been in such bad shape, and were the USA still looked upon with reverence and respect throughout the world. Surely we are not, and we haven't been for a long while. I think we stooped to our enemies level, and in a way, perhaps lost our integrity. Wall Street is not going to be happy with Obama, and I'm happy about that, because the vast majority of people in this country have more important things to worry about then whether or not the Dow is up 500 or down 500 today, tomorrow, or whenever. So, while I've been critical, and skeptical, I think that the guy deserves a shot to prove that this country can return to the status I used to read about in history books. While he will go down as the first black President, if that is all he is known for in a good way after his term(s), then he is a dismal failure. I hate to say it, but I have a feeling he might have a lot more substance than many imagine. We tend to be so jaded that someone who speaks like Ghandi and speaks of ideals is scoffed at. Regardless of what happens, I don't think they should be. We're all in this crazy thing we call life together, and that includes the entire world, not just US. The markets today are back to reality. Folks, we are going to go a lot lower, and you know what? That's ok, and it'll lead to a realistic market eventually. In the meantime we are absolutely busting this market wide open. If you read my blogs the last couple of days then you were short, like I and clients were - FSLR and SPWRA. Go check them out. We NAILED IT! Let's hope Obama nails it half as well! I could use some innocence and naivity in my life, and so can my little girls. I want them to grow up in a safe country, and a thriving country. It's about time we start going back to basics, and planning for the future, not just for "today". I rarely if ever show partisianship, I've learned not to mix politics with business. I made that mistake a long while ago and pissed a bunch of clients off. I just felt it important, as an independent, to say something because it has to do with the markets, and the economy, and ultimately the quality of life that we all collectively strive for. What we have now on many levels, I think the vast majority of us would agree, isn't working. It is, indeed, time for a change. Is this the right change? I guess we'll find out soon enough. I certainly hope so. Whether you voted for the man or not, I loved what John McCain said, he is our President. Let's keep an open mind and heart. God bless all. Michael "Waxie" Parness