Today was another painful day for the Bulls or anyone holding stocks "Long and Wrong". It was another great victory for the Bears (I am unapologetic and a proud member of the camp) A Truly Awesome day with the S&P 500 Losing 23 points and the Dow dropping 239. What a great day! How would you like to say that after a day like today? I am warning you its not for everyone.
The International Monetary Fund got things back to reality with their comments on the worsening housing market situation, Treasury Secretary Henry Paulson issued guidelines to create a covered Bond Market in the US, which decimated the Equity Shares of Government Sponsored darlings Fannie Mae and Freddie Mac. The US announced a record Budget Deficit of $482 Billion Dollars, Damn I guess the war on Terror and Invasion of Iraq is expensive. All this is great news for my investors, as it confirms our short bias, and puts money into our pockets.
Financial stocks led the declines with AIG plummeting over 12%. Merrill Lynch (MER) Fell over 11%, Lehman Brothers (LEH) over 10%. Please refer to my previous post entitled "The Equity of Many Banks are worthless" for more color as to why this is all happening. Amgen (AMGN)was one bright spot after hours beating analyst forecasts. However it is going to take much more that one Biotech company beating numbers to rally this market. Its going to take the US Housing market (the Cause of the problems) turning around.
The Financial Advisors and Long Only Money managers are crying. I guess Hope still Springs eternal, even in the face of repeated evidence to the contrary. I am heartily laughing at them all the way to the bank.
However, I still feel bad for the people who I have pleaded with to manage their funds who refuse to see the situation as it is. I understand Change is uncomfortable. I also understand that I sometimes come off as a crude, fast talking, insensitive, know-it-all ass hole. I get that. But I truly have your best interests in mind. My only intention to speak frankly and be objective.
I have tried as hard as I could. And I give up. They say you can take a Horse to water but you can't make him drink, I see many thirsty malnourished horses, who are in need of water, but stubbornly refuse to sip. This Cowboy has no choice but to leave them to fend for themselves, and ride off into the sunset.
Objectivity is a tough pill to swallow, but once you get her down you will have an uncommon insight and more clarity into market operations, and much more money in your retirement accounts. Happy Trading.
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