Monday, April 19, 2010

Man o man alive...

Today was what I am dubbing an N-shaped day. We opened down, went up to green, then went back to low of day and then closed at our highs. Hence an N shaped day. Hey, why not, we have V and U and W shaped recoveries, we might as well make good use of the whole alphabet.

In the meantime, I think tomorrow is a critical day for this market. GS reports and how well that sector reacts is going to determine, or help to determine where we head on either side of 1200 S & P. Today's action was more short covering late day into GS then anything else I believe and I still think we pause here with an outside shot at a decent size correction.

Couple things I'm looking at on pullbacks are some of the biotech stocks that have FDA and other news dates supposedly upcoming. Stocks like DNDN, HGSI, POZN all have important milestones upcoming and that trade has worked extremely well for a while. I am looking to add to those on a drawdown.

I have to say that anyone who knows me knows I'm not a "fan" of GS, and I can't possibly know the facts here, but it does seem really odd to me that anyone can claim this isn't political smoke and mirrors. I mean, come on, either these practices were right or wrong 10 years ago, or they weren't. Now, all of a sudden when a vote on financial reform is up they decide its wrong?

I think its wrong, which is why it might be surprising for me to take this stance, but I just think that things are a lot cleaner when they are done BEFORE meltdowns, then afterwards. And, how can it be glossed over for decades, but now its fraud?

The truth is that the average investor is at a HUGE disadvantage and is usually the one hurt in any meltdown. Most investors don't make money in the market, which is why when I get told that most traders don't I scuff. I will go to my grave saying that trading is far safer over the long haul then investing and at least you have control over your destiny. Imagine being a GS shareholder for the first time a week ago only to have your head handed to you. Don't get me wrong, I've had my head handed to me many times. I was just doing my Marketcast class and relayed how I was long a biotech stock last year and got DESTROYED on it due to bad news that came unexpected. My account was cracked pretty darn hard and it was not a happy day inside my brain, trust me. But, at least I feel like I can pick myself up and make decisions for myself.

Right now, what's interesting (or disturbing depending on your way of looking at things) is that as much as we are trying to crack down and regulate, we're doing almost the exact opposite. How? Well, these regulatory agencies are supposed to look at market manipulation like insider trading, or the type of trading they claim GS did, where they didn't disclose properly. Obviously there are other indiscrepencies, but those are two big ones. But, the thing is, the politics of all this is very blatantly manipulating the markets in much the same way, or even worse.

The only reason the stock market went up is due to government intervention. It feels sorta like in a very literal way that we're now "too high" and thus they want to tear it down a notch, lest the citizens revolt! And, I don't blame the average, or most, Americans for being pissed, but the anger is misplaced I think, which is why we hear these now cliche terms that its "Wall Street's fault!"

What does that even mean? There are private banks that have nothing to do with Wall Street that went under due to over zealous lending practices. Am I Wall Street cause I'm a trader of stocks?

I certainly hope not, I certainly don't want to face any angry mobs, I like to view myself as a good guy on the side of right. Not perfect, but a good guy nonetheless.

So, where is the problem? The problem is cultural is my take. It's culteral greed and the notion of being a society of victims is disturbing. I saw something late night last night about this guy who slipped and fell and everyone told him to "SUE!" I didn't catch the whole thing so I may be taking it out of context to be fair, but basically he said that he told them he didn't get hurt and that most people said "so, sue anyway, you can get a lot of money!"

Now, if the guy was hurt, he should sue if thats what his inclination is. If there is negligence then that seems appropriate, but suing for the sake of suing because you "can" sue and no other reason? That seems disturbing to me. There should be some thought process, I think, about the other side of things. Again, this is coming from a guy who had a very bad car accident last year and who would like to sue for my damages, but I think that there are limits and we push the limits of those boundaries at times. I just wanted to disclose that piece of it, lest I get called a hypocrite, which I may be called anyway come to think of it.

Regardless of me, I think that it's now time to concentrate on creating jobs and helping families in this country EAT and have a good home, and good healthcare, things that we all should have and all deserve. These political agenda's, I mean, does the average American think that they are going after GS now for any other reason, other then to force an agenda? And, I agree with the basic tenets of much of that agenda by the way, and again (I feel like I'm qualifying way too much, hehe).

I just don't agree with the tactics that seem routine now in the way our government works on both sides of things. Even the choice to go after GS was 3 to 2 vote with 3 Dems voting for it and 2 Reps against.

How in the world are we going to bring everyone together when things are so skewed that decisions are made not on the merits of cases, but on the political will of one party or the other?

And, lest I be accused of being anti Dem or anti Rep, I think you can see I really don't give a damn about either party at this point. I do care, however, that manipulation is deemed manipulation and that means that if the markets are being manipulated then ALL parties are accountable.

How about all the lobby money, all the political contributions and all the money made on the stock market leading up to the meltdown by these politicians, how about they, as a show of good faith to the American people, how about they give it all to back?

Since clearly there was a lot of looking the other way, which no one can really seriously deny, let's assume some of it (I'm being generous) was because of lobbiest and that the market was zooming to 15,000.

How about that for a start?

Just remember an old adage - "when one finger points at someone or something else, THREE point back"

Oh, and I'll even qualify that, what I really think is, again, its time to focus on POSITIVES and move things forward to really and truly help people. If I am out of work and starving, I want to eat, I can't feed my kids a law suit, they don't taste very good.

G-d bless and let's see what happens when the market shakes out tommorrow, I'm confused here.

BTW, if you don't know it yet, we are having 2 or 3 FREE classes this Thursday evening starting at 7 pm EST. If you didn't get an email about it, send me one and I'll forward it on to get you signed up;

Peace out, see ya on the other side,



Hendry said...

Hi Michael Waxie,

It's alwayz refreshing to read bout your take on the market. I tend to freakout when the market goes against positions I hold. I tend to sell too early n take a loss only to see the whole things rebounds on me n me left biting my fingers.

Whatever I plan to do, it's always the opposite when the time come.

One thing I notice, Whenever GREED is creeping up @ my doorsteps, and I allowed it to enter, that's when I became irrational n I could be on losing trade for weeks.

Thank you my Mentor,

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r said...

Waxie - did you get to pick up DNDN before the FDA announcement today? I know you were waiting for a pullback...was about to go long but I had to take the garbage out. Literally 5 minutes later the f*cker jumped 14.87%
You nailed it, hope you made big bucks

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