Wednesday, April 27, 2011

TODAY'S DOG AND PONY SHOW

What does the Fed eventually have to do? Raise interst rates. That's right......they do.....someday. Will it be today? Unlikely. Would that change any of my outlook for the Market or the PMs if they did raise today? Nope. Wait...one caveate, if they raised rates 1.00 basis points and announced absolutely no further monetary stimulus whatsoever then I would change my mind. But guess what that is NOT going to happen today. In fact not today and not in the twelve months.

Today may yield a "possible change in direction coming with interest rates". They may even go so far a to announce a rate increase will begin before the end of the year. This is unlikely to have much effect on the market long term but it may be vague enough to roil commods today. Personally I think a surprise 25 basis point raise today would be very effective for knocking the legs (short term) out of the commods and PMs but its not likely. Of course his press conference after the FOMC announcement could signal something just like that is going to happen. If there were a rate increase it would change NOTHING with the prospects of further QE whether its announced or surrepticious. They will have to continue to fund the debt......PERIOD!! This is one grand scheme called a PONZI. Then last thirty years in particular were a liquidity Ponzi that with the out of control derivatives growth in the last decade (and now) became a Nightmare on Wall Street Event. Now we are in the phase of unwinding it and its not going to be pleasant.

I watched a show on Bravo last night about Concierges for expectant mothers in New York City. Just an absolute pathetic disaster. None of the expectant mothers cooked......worse they didn't even know how or where the pots and pans were in their own kitchens. Both husbands worked on Wall Street and were just as clueless. The show was about a woman that is hired to INSTRUCT THESE CLUELESS PARASITES on how to take care of their own damn babies. We are so foched.

If the Fed announcement tanks PMs then I'll be buying some. No effect on the biotechs from this announcement today so they remain their own game for now. Also if HNR WPRT SGY get their teeth kicked in I'm nibbling. I doubt a lot happens but the HUI is getting warmer for the miner's buy. If you have your core HOLD ON.

87 comments:

  1. http://www.roadtoroota.com/public/584.cfm

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  2. SPPI Blew out numbers FDA ruling in 2 days could be next JAZZ....AS in price apprecaition...cheers

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  3. VXX moving up ..........finally

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  4. ERY is being bought right now...looking at day trade possibility...

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  5. Credit guy hopefully just getting warmed up.on SPPI...AEZs I AM OUT.....CHEERS Nice play watch it run to $3 now........

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  6. a big trader was talking today about the large number of HFT traders and floor guys that are dropping out in droves from the market due to the low volatility.......can't survive

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  7. Picked some more DTO this morning. Also glad to see the VXX finally go in the right direction as well.

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  8. Rudy....this is why I was looking at ERY/DTO as day or multi-day trade...

    http://news.yahoo.com/s/nm/20110427/pl_nm/us_usa_oil_republicans

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  9. Also, the dollar needs some strength. A little jawboning by the Bernake could send the dollar up to push down the commodities...for a while

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  10. Look at the demand destruction. Listening to CNBC, shocking how there could be such huge builds...Seriously, wait until the price of gas hits five or six this summer. Everyone will be walking!

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  11. dj,

    SPPI's Friday decision on FDA approval is 50/50, it was rejected before by FDA so be careful, if it's rejected on Friday again you know what will happen. If it's passed then pps will double quickly. They announced good earnings and it's a good company but having said that hedge funds will do short work on it if FDA is not approved.

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  12. Rudemood,

    So far 1.35 on CRYP is holding and float is tight, this one can go either way depending on take over or lack of it, I agree if 1.35 is broken then it can really drop. I am not playing it now since risk/reward is not good, this one at current price is a tough one in long side or even the short side since it's in the middle. I like to see them really hammer it and I get in for short squeeze. If good news comes in and explodes it to the upside at current price then so be it. I do not feel comfortable to get in now.

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  13. DJ,
    was that a flash crash in JAZZ today....
    what a game this is...

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  14. Chuck,

    See what happened to PZG, yesterday I mentioned that for PZG to maintain upside after pivot point needs to get to 3.50 and HOLD, it got there BUT did not hold and look what's happening, heheeeeee!

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  15. Oh my look at ANIK almost missed that...

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  16. look at the pattern on it joe....this is a good one...its repeating last mo

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  17. Dr. kline,

    To be a good trader with biotech stocks, you also need to be a good shrink, the hedge funds are good at therapy which includes both side of the coin, heheeeeeee!

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  18. HL is going to touch 8.50 an if lucky blood letting to sub 8

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  19. Joe,

    It looks like GS has seen fed notes already...bernanke if he so chooses could cause some pain in commodities or basic materials sector...looks like all the pain is there right now...

    CLSN keeps chugging along...do you see a pullback in cards?

    CFW is up on volume...amex issue resolved...

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  20. CLSN needs to get to 2.75 and HOLD, if it does not hold then heheeee, float is extremly tight.

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  21. Chuck, I warned kli about the PAIN in commodities and basic materials in short term, SLW has been really good to me in the short side at 46.

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  22. Joe,
    Does GFRE look interesting for quick move north with short interest and capitulation yesterday...

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  23. Could have bought GENE @$4 Pre mkt did not....Geez...Yes SPPI is a gamble on fda...I like their chances..Even if it gets declinded I will buy shares as comapny is profitable now....So....it is all good either way...Do have some calls that are up 50% hum i will let them ride....Credit guy IMO SPPI AT 9.8 is much better comapny than jazz at 32...SPPI also has a phase 3 canditate for liver cancer.....Screw the Bernake I am marching on...News highs by Jan 1st.....lol

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  24. chuck,

    GFRE was an excellent play yesterday when with heavy volume they took it down to 2.30 to play the bounce, if stock does not get halted then you might make some coin, it's small chinese cap stock so caution is advised. Talk about brutalized stock, heheeeee!

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  25. Yep, missed the GENE, too...DJ, love the screw the Bernank...thanks Joe and Kli for reiterating a few days ago what I already knew but sometimes get lost in other thoughts, lol. Carry on, the Wedding of the Century approacheth.

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  26. Nancy,

    You are one tough lady, I do not worry about you, stay focused and disciplined.

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  27. AGEN on move small bio pre run fo ASCO......

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  28. Sister I had to go to grocery store after I brought my dauther to school and it was @$4 when I got hm it was asking $5 I said oh well...lol......AND LOOK IT DOUBLE TOPPED from earlier high this yr....Could have bought for .50c earlier....I really like SPPI....Also think after this week is up Stocks like GMXR lng glng WILL BE GOOD PLAYS...

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  29. DJ,

    I like that AGEN..check out insider action lately

    http://www.reuters.com/finance/stocks/insiderTrading?symbol=AGEN.O

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  30. Thanks, Joe...tough lady with some massively SMART and Generous friends.

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  31. DJ, still holding my lng...just no good at day trading so try to buy the trends and hold...keep it simple is my trading strategy...

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  32. One thing that scares me about AGEN is it's low on cash..could be a pop before distribution news thingy...

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  33. Credit guy,YES THKS for insider info wow....I like it....cheers Sister, I made some bank on LNG earleir in yr..Rebought about 3 weeks ago and just waiting it will pop good again..I like atleast min of 12......cheers

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  34. SLW is one weird play lol..Up niceely on soft silver day.....

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  35. Where is Jim, are you trading? You are quiet, is your son-in law giving you headache?

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  36. Joe This is my thinking on SPPI...Stock is way overbought I am hoping by tomorrow they can bring stock up to $10.5 I sell my calls....Decision by Friday...THE FDA rejects and stock goes to $8 or 7.5 buy in then ride it up to 20's....EARNINGS From 2 cancer drugs etc...That is exactly what happended to JAZZ in Oct 10..stock got rjected went to $7.50 then ran up to where it is now....Also great call on rnn at 1.08 stock is waking the F up.....cheers

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  37. well Ben is a fluffer...hope u metal buyers made some change...

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  38. Joe Just sitting on the side for now. Do not trust Brenake or the Present Government. I think I will wait a few for days and see what happens. I work Thurs at the Golf Club, brought AGEN.

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  39. kli,

    You mentioned the show last night:

    "I watched a show on Bravo last night about Concierges for expectant mothers in New York City. Just an absolute pathetic disaster. None of the expectant mothers cooked......worse they didn't even know how or where the pots and pans were in their own kitchens. Both husbands worked on Wall Street and were just as clueless. "
    ------------------------------------------

    That's what I call a fucking nightmare, clueless bunch of morons, this is what happens when men and women forget their duties and go against nature's law, it messes up HARMONY. Disfunctional families = fucked up society and ofcourse the kids grow up more fucked up.

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  40. Joe, thanks for the wise words on CRYP, points well taken. the risk is high, no doubt.

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  41. Joe......she agreed and stated it was like watching a slow motion train wreck....she couldn't stop watching

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  42. could be some short covering into close gfre..

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  43. All of this behavior is continued to be made possible by the extension of the bailout/no consequences of bad behavior......ultimately their right to procreate is an abomination of nature

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  44. a bad part of the advance communication generation is the ability for one to think without device...

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  45. unnibbled my SLW.....probably too early

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  46. I was channel-surfing last PM and there as an old 60 Minutes on that was done during the housing boom. It was about larger houses.
    There was a time that a 3000 sq. ft. house was large, but then it went to 4000, and then 5000 sq. ft. Then jumped to 8000, and then 10,000. During the height of the bubble, homes of 12,000 to 15,000 sq. ft. were being built,...sometimes just for a family of 3 to 5 people.
    Just amazing.
    Now I suppose the taxpayer owns those homes.

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  47. "the federal reserve has undertaken extraordinary measures".......no chit ben

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  48. My area has dozens of 10,000 PLUS sq ft homes here that are SECOND HOMES.........hehehehee.....

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  49. Doc,

    Smaller homes led to family cohesiveness, the ability to work together to have fun, communicate, laugh, pass out a hug, learn time management and working around others while under time constraints etc... etc...

    mcmansions fattened america up like McMac's

    you dont live together in 5000 sq ft homes...

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  50. HNR could be a rotation tomorrow

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  51. EUO selling off in high volume.
    ?capitulation??

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  52. I didn't sell so its not capitulation yet....hehehehe

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  53. Combo of ZLCS, AEZS, and CLSN have made small biotechs a real nice one. It's like going to sub and asking for combo, heheeeeee!

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  54. Look for a double top in silver to complete the run up?

    http://www.ttheory.com/

    Lessons from Prior Gold Tops
    By Parker Binion
    April 24, 2011

    The precious metals rally that began in July-August of 2010 looks very similar to the bull runs in gold and silver in 2005-06, and 2007-08. Let’s examine what happened at the end of those bull markets for clues on how to play the expected top in metals coming in the May-June 2011 time frame.

    Here’s the end of the 2006 bull run:

    http://ttheory.typepad.com/.a/6a00d83455c65c69e201538e14932e970b-pi

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  55. Homer,

    Today my wife was babysitting our 4 yr old grandson and I was listening to bernanke and suddenly he said, " Grandpa would you please play the song smooth criminal":

    http://www.youtube.com/watch?v=sFvENQBc-F8

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  56. Inlet.....if the PTB are going to put a stop to the current run they had better take their shot there

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  57. mr.kli, since bernake reiterated that there will not be QE3 why did the dollar continue to weaken. is oil going to rise until QE2 is over and until the fed moves the interest rate up? if its up to the PTB, then what can derail oil, besides a strong dollar? earnings are good, unemployment is going down (haha, i know), and oil doesnt go down on higher inventories. i am perplexed.

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  58. Definitely confused with the action in PMs and miners today. If silver keeps going up, do we stay on the sidelines or join the herd? Personally, I have no plans to chase it, but it stings a little bit to be left behind. And I thought getting out of my PSLV position in the low 40s was a good move!

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  59. Bernanke made it very clear during Q&A that the fed WOULD NOT STOP reinvesting the balance sheet in bonds and equities after QE2 ends......once that was stated the market took off.

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  60. "Bernanke made it very clear during Q&A that the fed WOULD NOT STOP reinvesting the balance sheet in bonds and equities after QE2 ends..."

    then what does that mean, instead of calling it QE3 it will be QE indefineatly? one other question, i know you have traded ATPG in the past, do you think it has bottemed and is in the process of its next leg up? and thank you for answering my question on my previous post.

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  61. Rude, unemployment is actually going down. It is called demographics. 10,000 boomers a day are hitting the age at which they qualify for Social Security benefits. Do the math - that is 3.5 million a year.

    Now I am not saying all that 3.5 million are retiring the instant they qualify for Social Security benefits, but a high percentage are. I saw that over 20% of household income now is from government transfer payments (and this is expected to skyrocket).

    This will continue for the next 20+ years. In 10 years the US may even experience the shortage of workers that was being talked about 5-10 years ago when we were near full employment.

    Just a contrarian view on unemployment. Hehehe

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  62. http://pragcap.com/fomc-no-change-in-rates-qe-to-continue

    Your right Kli this is NUT'S!

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  63. Inlet, interesting take on the unemployment, honestly i didnt look at the boomers retirement angle, interesting to say the least.

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  64. Ben has no choice with extending some form of extend and pretend.....UNTIL....the stagflation KILLS the goose that laid the golden egg.

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  65. rude,

    from Bloomberg on boomer's effect on unemployment

    http://www.bloomberg.com/news/2011-02-07/aging-baby-boomers-reduce-u-s-unemployment-rate-matus-says-tom-keene.html

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  66. Without the fed buying the debt interest rates overnite will go to the moon ......OVERNITE

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  67. i just read an interesting article. Berkshire Hathaway may sue Sokol for the 3 million he made and they said he broke the law and miseled the "great" buffett. now, what i find interesting is
    Buffett who is never wrong, said that Sokol didnt break the law last month. so who is in charge of the company, one part of the company says Sokol broke the law and Buffett said the contrary. either way Sokol made buffett look like a tool.

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  68. "Without the fed buying the debt interest rates overnite will go to the moon ......OVERNITE "

    so unless the usa has "MASSIVE" growth, we are screwed, because eventially this crap cant go on forever. damn, seems like what you have said, Bernake is boxed in a corner, he doesnt have many options left. so, how high does inflation go? are we going to go into a hyperinflation mode?

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  69. Rude.....more than likely Sokols little game was discovered by a "third party" and Buffett was forced to dump Sokol...Buffett obviously lied about it being "no big deal" since Berkshire depends on Warrens avuncular trustworthiness....Does Warren deserve his sterling reputation???? I don't know but after 2008 and the last two years I don't think he does.

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  70. Tom, thanks for the article. and props to the people on this blog, i think it is great. very helpful people. you guys are smart. interesting points of views. thanks

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  71. NO HYPERINFLATION....but stagflation will be pushed to the MAX......no hyperinflation because the Cabal controls the debt and hyperinflation DESTROYS all debt.

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  72. Kli, i see, Buffett was squeezed. makes me wonder how many of these "little" games occurred at Bershire in the past. i would bet, many people in that company made a mint, on having prior knowledge on deals that buffett was to make. i wonder who the 3rd party was, i wonder if it was the SEC

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  73. "NO HYPERINFLATION....but stagflation will be pushed to the MAX......no hyperinflation because the Cabal controls the debt and hyperinflation DESTROYS all debt. "

    so the PTB loves debt because they make a mint and enslave the world, so destroying debt aint what they want. interesting. i think i understand. stagflation pushed to the max would be a fine line to keep though. something will give at some point.

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  74. "Today my wife was babysitting our 4 yr old grandson and I was listening to bernanke and suddenly he said, " Grandpa would you please play the song smooth criminal"

    Joe - I actually snorted fluid out the nose on your comment...unfortunately, I'm helping out with someone's computer but it will be okay.

    Kli - funny in a sick sort of way..."All of this behavior is continued to be made possible by the extension of the bailout/no consequences of bad behavior......ultimately their right to procreate is an abomination of nature "

    Real issue in my mind are all the folks who absolutely need to be numbed by these shows, housewives of beverly hills, jersey shore, etc. They love this stuff, producers love it. Any idea what the salaries were for Seinfeld, Friends, etc. Now you can almost get folks to do this stuff for scale or even free. Most people like to be numb and it is getting worse.

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  75. Great song pokin fun at those reality shows...I think you'd like this one Kli.

    http://www.youtube.com/watch?v=gxGCB6bw40U

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  76. real....is a hand you hold for fifty seven years....yeh sammy

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  77. Kli, i know Japan isnt the headline in the news, but the nuclear situation is still pretty nasty. it was the worlds #3 economy, at what point do you see it effecting the usa markets in a negative way. do you think it will take a quarter or two? japan seems to be a non factor from the news reports which i find surprising.

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  78. Japan is not in the news for a reason....its a disaster with only negaative connotations for the world economy...the MSM news stream is completely controlled.....you will NOT see the story except in small pieces

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